Victoria’s Small Business Mentoring Service provides an affordable avenue for small business owners to gain outside expertise.

The non-profit organisation links volunteer mentors to businesses seeking help.  Typically the mentors are retired executives with a wealth of experience to share.

Started in 1986, the service claims to have helped more than 15,000 business owners over its 25 years of existence.

If you are a business owner operating a business with less than 20 staff, you might wish to consider contacting the Small Business Mentoring Service for help and support.

Heard about Self Managed Super and want to find out if it’s right for you?  Why not download our free ebook – SMSF’s – Australia’s most popular way to save for retirement

Guidance Financial Services – specialist financial planning advice for business owners and the self employed

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We’ve recently published a new ebook:

SMSF – Australia’s most popular way to save for retirement

This easy to read booklet contains valuable information for anyone considering setting up a new Self Managed Super Fund.

To download your free copy of our SMSF ebook, click here.

Guidance Financial Services – specialist  financial planning advice for business owners and the self employed.

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Self employed people don’t have sick leave.  If you can’t work, you don’t get paid.  Chances are for a week or two you can get by, but what happens of you were unable to work for 3 months, 6 months, or longer?

That’s where Income Protection insurance comes in.  You are effectively buying yourself long term sick leave.  You will select a waiting period, commonly 30 days.  Within this period you need to support yourself.  However if you continue to be unable to work beyond this waiting period, then a monthly benefit will start being paid.

The monthly benefit is typically determined as 75% of your normal income.  It’s not 100% because the insurer wants you to have an incentive to get back to work.  Hopefully three quarters of your normal income is enough to pay the bills and keep the household afloat.

Click here for an Income Protection Quote:

Income Protection quote

There are variations as to how the monthly benefit amount is determined.  It might be guaranteed from the outset or determined at the time of claim.  Advice here is essential.

Waiting periods can be varied to suit your circumstances, as can the period the benefit is payable for.  The most popular is for a policy that would pay a benefit until you reach age 65 (assuming you were unable to work for that period of time).

The insurance premium for Income Protection is typically tax deductable, which certainly helps.  It does mean that when a benefit is paid, it is assessed as taxable income.

Every self employed person should have Income Protection, yet only around a third do.

Contact us to talk through your needs.  We have access to all of the major insurance providers in Australia, so we can find the policy that works for you.  If you wish, we can arrange everything over the phone.

Phone 03 9870 6544 or email us here.

Guidance Financial Services – specialist financial planning advice for business owners and the self employed.

This information is of a general nature only and has been prepared without taking into account your particular financial needs, circumstances and objectives. While every effort has been made to ensure the accuracy of the information, it is not guaranteed. You should obtain professional advice before acting on the information contained in this publication.

If you’re a wage earner, your employer takes care of your superannuation contributions.  If you choose, you can have little to no input in what is going on.

However the situation is very different if you are self employed.  Depending on the size and structure of your business, it may be that you are on the payroll and therefore receive some compulsory employer contributions.  However for most business owners that I deal with, if they are on the payroll it is for a nominal amount.  There major income comes from drawing down the profits of the business.

So lets consider the situation where either all or the majority of your income is derived by drawing down the business profits.  There are 4 key points to know:

1. How much must I contribute to super?

None.  As a self employed person there is no legal requirement for you to contribute anything into super.

2. What is the maximum I can contribute into super?

The current (2011/12) annual threshold is $25,000 of tax deductable contributions (note – you can contribute more in “after tax” contributions but that’s a separate matter).  If you are over age 50 there are currently provisions to contribute up to $50,000 in 2011/2, though this higher cap for over 50’s is due to cease.  The government is yet to confirm whether people over age 50 will continue to have a higher cap in 2012/13 and beyond.

3. Why should I contribute to super?

Because it is the most tax effective place in which to save for your retirement.  And you definitely need to save for your retirement because the Age Pension isn’t very generous and will only get worse as our population ages.

Also because of the annual contribution caps mentioned above, it’s not like you can ignore super until you’re 50 and then go hell for leather in contributing for the last 10 or 15 years of your working life.  You simply wont be able to put enough in to generate a comfortable retirement income.

4. But I hate giving my money to fund managers, all they do is charge me fees.

You should talk to us about setting up a Self Managed Super Fund (SMSF).  SMSF’s are very popular with business owners and the self employed, as they offer far more control in how your savings are invested.

Be very careful regarding the contribution limits.  If you exceed them the tax penalty can be quite severe.

Got some questions?  Give us a call on 03 9870 6544, or send us an email.

Download our Free ebook – SMSF – Australia’s most popular way to save for retirement.  Click on the green “Learn more about SMSF” on the right of this page.

This information is of a general nature only and has been prepared without taking into account your particular financial needs, circumstances and objectives. While every effort has been made to ensure the accuracy of the information, it is not guaranteed. You should obtain professional advice before acting on the information contained in this publication.

Guidance Financial Services – specialist financial planning advice for business owners and the self employed.

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Standard & Poor’s released their review of the global banking system, ranking Australia third safest, behind  only Switzerland and Canada.  This assessment has provided analysts with confidence that Australian banks will retain their coveted “AA” rating.

The Financial Review today quotes Commonwealth Bank CFO David Craig as saying a downgrade from AA to AA- would have no impact on funding costs, however ”….if it was to (single) A, that would make a difference”.

With the Reserve bank recently lowering interest rates to stimulate the economy, what we don’t want to see is banks needing to raise rates to counter rising cost of funds (due to a reduction in their credit rating).  Small Business, including those hundreds of thousands of self employed contractors, are the well established engine room of our economy.  They require bank financing to grow and create new employment opportunities.  High interest rates choke off this potential for growth.

Guidance Financial Services – specialist financial planning advice for business owners and the self employed.

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Today’s Fin Review (8 November 2011) quotes some interesting numbers on how a consolidated Europe would look in economic terms.

The Financial Review attributes this information to Paul Sheard of Nomura.

So the thesis put forward is that if Europe were to further integrate their economy, which is the path it is currently taking, it would, far from current appearances, in fact be economically sound.  And with the current measures being inflicted on the weaker countries by the stronger (primarily Germany), one could imagine a future where a United Europe was an economic powerhouse.

Guidance Financial Services – specialist financial planning advice for business owners and the self employed.

It is apparently worth about $5 and that is in novelty value.  Zimbabwe no longer issues its own currency.

The wonders of printing money as an economic strategy.

Click here for an Income Protection Quote:

Income Protection quote

Guidance Financial Services Pty Ltd – specialist financial planning services for business owners and the self employed.

http://melbourne.startupweekend.org/

Looks like an interesting event for those with an IT/entrepreneurial streak.

It’s on 4-6 November.

Guidance Financial Services – Specialist financial planning advice for business owners and the self employed

Accounting firm Ernst & Young have published a global report on entrepreneurialism ahead of the G20 Young Entrepreneurs Summit next week.

The report Entrepreneurs Speak Out, highlights five key pillars to build a successful enterprise environment: “entrepreneurship culture”, “education and training”, “access to funding”, “regulation and taxation”, and “coordinated support” between the different public agencies involved in facilitating and supporting entrepreneurship within a country.

With most developed economies around the world facing years of anaemic growth at best, encouraging people to take risks and create new enterprises is more important than ever.

Is your business reliant on its people? Is your key person insurance up to date? Learn more from our free e-book – Key Person Insurance – A succinct guide for business owners.

FREE - Key Person e-book

Guidance Financial Services – Financial Planning for those with the courage to have a go.

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The Financial Planning Association (of which I’m a member) are currently promoting the difference between Certified Financial Planners and the rest, so that consumers are better informed when seeking out financial planning services.  I fully support this initiative.  If you are interested, the details can be found here.

Download our Free ebook – SMSF – Australia’s most popular way to save for retirement.  Click on the green “Learn more about SMSF” on the right of this page.

Guidance Financial Services – specialist Financial Planning advice for the self employed and those running a business.