And that’s another year done and dusted! As we move into the second half of the financial year, we encourage you to look closer at the financial forecasting of your business. Although many business owners are keen to set up regular budgets to keep track of their accounting, it is just as important to dive into the nitty-gritty of forecasting.

Forecasting predicts future business trends by looking at past and current activity. This allows business owners to understand where their business is heading and how they can adapt to any positive or negative changes. Cash flow forecasting looks specifically at the money coming in and out of the business, allowing business owners to predict surpluses and shortages in cash over the period. Recording this information is extremely useful for major business purchases, tax purposes or when applying for loans. Without implementing regular forecasting techniques, it can be difficult to not only grow your business but also avoid any potential issues down the track.

Smart financial forecasting for your business

So how can you start implementing smart financial forecasting techniques within your business? Before you can even think about starting your forecast, it is important to step back and look at your goals for the next period. Do you want to be increasing your income by a certain amount or investing in new machinery? Do you want to make some new hires or cut back on your hours? Once you have a vision of your goals, you’ll then be able to have a clear perspective on how your forecast affects future decision making.

Preparing your documentation is the best way to make your forecast as seamless as possible. You can start collecting information around fixed costs (consistent costs e.g. wages and insurance) as well as variable costs (costs that change e.g. material costs and utility bills) and income history. By collecting as much information as possible showing past and current trends, your accountant will be able to help you achieve a successful forecast.

Forecasting tools and advice

Does your business currently use forecasting to achieve your financial goals?

With real estate prices skyrocketing out of control over the past few years, some of us are left wondering how our children will be able to afford a home of their own. Maybe they will be forced to rent for a long period or even move to an entirely new area in the outer suburbs. A growing number of parents are now assisting their children to enter the housing market by providing part of the equity in their property as security.

So what are the pros and cons of using your home as equity for your child’s investment?

Pros and Cons of using your home as equity

Allowing the use of your home as equity may enable the borrower to avoid Lenders Mortgage Insurance (LMI). If the loan exceeds 80% of the bank’s valuation of the property they are purchasing, the LMI can equate to a very hefty figure. As you may know, buying your first home can be incredibly stressful, so if you are not in a financial position to contribute funds, the use of your home as equity is a great way to help your children achieve their dream. However, your children will still need to have the capacity to repay the loan using their current income – and unfortunately, there’s no getting around this.

Although assisting them in this way may save time and money, there are also risks involved if the borrowers default on their loan. By using your property as equity you will be deemed a guarantor. It can be a risky move that could leave you in financial stress if your children run into financial difficulties down the track.

Getting started with property investment

Providing your children with equity through your own property is incredibly useful for their investment if you have confidence in their financial position.

If they wish to proceed, with your assistance, it is highly advisable to contact a reputable Mortgage Broker and here at APS Mortgage Broking, we have a friendly team with decades of experience that are able to assist you………..for FREE.

Do you have a reputable Mortgage Broker to find you the best solution?

Click here to find out how we can help you!

When a marriage or defacto relationship breaks down, the law is very specific in how it deals with superannuation. The Superannuation Splitting Law allows couples to value the superannuation and split it fairly between them.

It's important to note that split super is not converted into cash. It remains a superannuation investment and continues to be subject to preservation and other superannuation regulations.

Before superannuation can be split, it must be valued. A formal submission must be made to the trustee of the super fund confirming your entitlement to request this information.

The Superannuation Information Kit available from www.familycourts.gov.au contains all the details and forms you'll need for the entire valuation and splitting process.

Contact Timothy Foster from APS Financial Planning should you require assistance with your superannuation.

Do you have superannuation in any of the following?

• PSSAP – (e.g. if you have joined the Commonwealth Public Service within the last 9 years),

• An industry Fund (e.g. CBus, HESTA, Hostplus),

• A public retail fund (e.g. AMP Super, Colonial First State, BT Super), or

• A self-managed superannuation fund (you are a trustee or director of trustee).

If so, then it is important that you consider putting in place a "binding death benefit nomination" (BDBN) to cover what happens to your superannuation when you pass away.

If you already have a BDBN in place, you should check that it is still what you want and that it has not lapsed.

If you do not have a BDBN then it will be up to the trustee of the super fund to decide where your super is paid, which may not be what you would have wanted at all. Also, the absence of a BDBN will most likely cause unnecessary additional time, cost and inconvenience to the persons you have appointed as executors in your will. If you do not have a will then the potential problem is compounded.

A recent court case has highlighted this issue. The case concerned a mother who was in charge of the estate of her late son, where there was no will and there was superannuation not covered by a BDBN. The court decided that the mother was under a duty to request that the super be paid to the estate (where it would have to be shared with the late son’s father, who was estranged from the mother). This meant that the mother was under a duty to act in a way which was:

• contrary to her own best interests as potential beneficiary (she would receive only half the super instead of it all);

• contrary to good tax advice (as more tax would likely be payable if the super was paid to the estate); and

• contrary to the late son’s known wishes (he wanted all the superannuation to go to his mother).

The only way to avoid these issues with certainty is to have a valid BDBN in place, but having a valid will also helps.

Did you know...
We can assist you with a variety of legal matters apart from wills and estates?

For example, if you are buying or selling real estate in Victoria then we can do the conveyancing for you at competitive rates.

Or 

if you have a company, a family trust or some other business or investment structure then we can assist you with the legal aspects of establishing or maintaining that business structure.

Contact APS Wills and Estates