How to Grow Wealth?

With the RBA cash rate at 2.50% and term deposit rates around 3.60% it’s now more important than ever to look at investments such as shares and property to grow your wealth.

Recently the big four banks reduced their five year fixed loans to under 5%. This means banks funding costs are dropping. As a result they will not need to continue to offer you 3.60% for a term deposit going forward. According to the Reserve Bank of Australia’s the current inflation rate is 3%. Therefore, after tax it is more than likely your cash or term deposit investment is actually losing you money.

If you are going to invest in shares and property, which are the right investments to buy? We believe you should always select quality companies or properties when investing, whether that is shares or property. Both investments classes are not short term. Investors need to take a minimum five year investment horizon and history shows quality investments grow long term.

Investors must also decide on how to purchase these investments. Do you buy them in your own name, do you establish a discretionary family trust to control the distribution of income and capital gains or do you look at an investment vehicle such as an investment bond where the income is not added to your assessable income rather taxed at 30% within the bond less franking credits.

All the above areas must be considered when you start your wealth creation strategy.

More About -- > Thomas Jacks

Thomas Jacks BCom (Acc), SMSF SpecialistTM, Adv. Dip F.S. (FP)
“I want to be able to assist clients with their investment and retirement planning by providing real strategy advice. It’s my aim to not only help my clients but to educate them by addressing the entire picture” Google Plus