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About Me

Tony Lu

Financial Planner
Announcer Financial Planning
Sydney, New South Wales
0416 084 370
Financial Planner

My Activity

Q: My partner and I are looking to merge our finances (we aren't married, but have two kids and have been together for five years). We both own investment properties and I have shares in the business I work for. Any tips?
A: Hi Al,

The initial conversations about merging your finances can sometimes be awkward (especially if you have been managing your finances independently for over 5 years).

The two tips I would would give is
1. Set some goals together and place the level of priority for each of them. Understand what you as a family would like to achieve in the short, medium and long term.
2. Establish a budget - What I find useful for my clients is to sit down and work through a budget so you and your partner can get a good understanding of how much each of you typically spend and on what items. I would also suggest allocating a discretionary amount which allows each of you can spend without guilt. Based on the surplus, you can start putting steps in place to achieve your goals.

From my experience, couples that work together keep each other accountable and allows you a better chance of achieving your goals. Your investments are only a vehicles to allow you to do the things you want to do in life.

From a tax perspective, all income and capital gains/losses from your current investments will continue to be declared in your individual tax returns as it has been in the post. For future investments, you can speak to a professional about how to own and structure your investments to achieve the best tax outcome depending on each of your financial situation.

Hope that helps.

Tony Lu
Financial Planner
Announcer Financial Planning
1300 133 991
Q: Our business has been operating for 18 months and we need additional investment to grow. Instead of taking on new investors is it possible to set up our own SMSF to invest funds and have shares in the business?
A: Hi Bernadette,

I would like to add to Ben's comments in relation to in-house assets not being more than 5% of the SMSF's total asset value. The 5% rule not only applies to the initial acquisition of the related party investment but will needs to be less than 5% of the total fund value on an ongoing basis.

If you were to enter into this transaction, you will need to continually monitor the fund's total assets position to ensure you comply with the rules. If you exceed the 5% limit, you may be forced to add more funds to the SMSF or sell down your related party investments.

Hope this helps you with some of your decision making.

Kind Regards,
Tony Lu
0416 084 370 | 02 9251 5558
Q: As a trustee for my kids who are receiving money from inheritance, what are the best options to invest their money and what are the tax implications for me as the trustee?
A: Hi Dan,

This is a common question that most trustees ask.

The best place to invest the inheritance is dependent on the children’s ages and time frame of when they are to access the funds and your risk tolerance.

Typically, if the kids are going to get access to the funds within the 0-5 year time frame for things such as a school fees, funding a gap year, buying a car, deposit for a home then there is an emphasis on income earning investments that generally provides a reliable and stable income with little or no capital growth returns such as cash and fixed interest.

If the kids are not going to get access to the funds for the longer term (i.e. 5 years +) then you could consider investing in assets that have an emphasis on capital growth such as property and shares. These investments are generally considered riskier because their values can fluctuate regularly. Holding growth investments over the longer term increases the chance of achieving higher returns on the money.

In summary, your children may have a number of short term and long term goals. Investing in a combination of income and growth assets will diversify your portfolio (“don’t put all your eggs in the one basket”) to minimise volatility and provide you with a better chance of achieving the kids goals.

The tax implications as trustee depends on the nature of the trust. You should speak to your accountant about the trust structure. Some example of trust structures could be
• Testamentary trust
• Discretionary trust
• Fixed trust
Lastly, some care must be taken in relation to minors receiving income as there are higher tax rates that are applicable on investment income taxed in a minors name.

If you have any further questions please do not hesitate to contact me on 02 9251 5558.


Tony Lu
Announcer Financial Planning