Sam Henderson - Financial Planning DIY Guide

Sam Henderson

First published 2011 by Wrightbooks an imprint of John Wiley & Sons Australia, Ltd

42 McDougall Street, Milton Qld 4064

Office also in Melbourne

Typeset in Berkeley LT 11.3/14pt

Sam Henderson 2011

The moral rights of the author have been asserted

National Library of Australia Cataloguing-in-Publication data:

Author: Henderson, Sam.

Title: Financial planning DIY guide / Sam Henderson.

ISBN: 9781742468273 (pbk.)

Notes: Includes index.

Subjects: Finance, Personal.

Dewey Number: 332.02401

All rights reserved. Except as permitted under the Australian Copyright Act 1968 (for example, a fair dealing for the purposes of study, research, criticism or review), no part of this book may be reproduced, stored in a retrieval system, communicated or transmitted in any form or by any means without prior written permission. All inquiries should be made to the publisher at the address above.

Cover design by Peter Reardon, Pipeline Design

Cover images: iStockphoto/Alex Slobodkin

Printed in Australia by Ligare Book Printer

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Disclaimer

The material in this publication is of the nature of general comment only, and does not represent professional advice. It is not intended to provide specific guidance for particular circumstances and it should not be relied on as the basis for any decision to take action or not take action on any matter which it covers. Readers should obtain professional advice where appropriate, before making any such decision. To the maximum extent permitted by law, the author and publisher disclaim all responsibility and liability to any person, arising directly or indirectly from any person taking or not taking action based upon the information in this publication.

About the author

Sam Henderson is CEO and Senior Financial Adviser at Henderson Maxwell, a fee-for-service, independently owned, boutique financial planning firm with offices in Sydney, Melbourne and Brisbane that specialises in self managed super funds and actively managed accounts.

Sam has a Master of Commerce (in progress), a Bachelor of Commerce (Accounting), a Diploma and Advanced Diploma of Financial Services and an Advanced Diploma of Marketing Management and he is an Accredited Mortgage Consultant, direct-share specialist and an expert in self managed superannuation funds.

Sam is a regular on Foxtels Your Money, Your Call and regularly contributes to Money magazine, Womens Weekly , the Sydney Morning Herald , Financial Review , the Age and Financial Standard and Independent Financial Adviser and Asset magazines. He has been a keynote speaker at the ASX Investor Success Series, Retirement Expo and the Investment and Property Expos in both Sydney and Melbourne.

Sam is also a regular presenter and an expert in practice management within the financial planning industry, having spoken at the national Financial Planning Association Conference, Financial Standard Managed Accounts Conference, Dealers Group Conference, CPA Congress, Financial Wisdom Premium Practice Conference and many other industry conferences since 2004.

Apart from reading tax and superannuation legislation, Sams interests include surfing, snow skiing, ocean swimming, triathlons, wakeboarding, cars and spending time with his family.

For more on Sam visit .

Acknowledgements

Id like to acknowledge my wife, Jacqui Henderson. She has been a constant support and my rock since I started Henderson Maxwell and that support has extended to the writing of this book and well beyond. As I write, she is six months pregnant with our second child.

I would also like to acknowledge that this book has taken away just a little time from my beautiful daughter Aanika who has watched every Wiggles and Dora the Explorer video while I tap away at the computer. Your infectious laughter warms my heart.

Id also like to acknowledge my mum and dad. Mum (Dorothy) has been a constant support and reinforcement of good old-fashioned values and hard work. Retired now, she is a true modern-day champion, having brought up three children and now my sisters child (her granddaughter) from birth.

Thanks to my dad (Max) for his great fathering, entrepreneurial spirit and business tutelage from an early age. He has been a great role model for me over the years.

Thanks to Tim Purcell, and his father Terry, from Retire Law in Warriewood, Sydney, for his guidance in the estate planning chapter. Thanks to Louise Biti of Strategy Steps for her assistance on the aged care chapter and to Victoria Crighton and the team of FISOs (Financial Information Service Officers) at Centrelink for their guidance in the Centrelink chapter: they truly are there to help you!

Thanks to my clients for their trust, loyalty and faith in me to manage their life savings. My staff and I carry that burden of responsibility with great pride.

A final thank you to my staff who have had an absent father for the past six months while this book has come together. The staff at Henderson Maxwell are simply the best with their constant dedication to their clients and passion for independent financial advice.

Preface

Im passionate about financial education and I truly want to help you take the steps you need to reach your financial goals sooner.

Like fitness and diet, successful financial management is too often neglected and, too often, improvement is poorly implemented.

Wealth management can be a topic shrouded in technical jargon to the point of being bewildering or it can be spruiked by the unscrupulous seeking a quick buck while their disciples seek a quick fix. Its a bitter pill to swallow for some, but there is no quick buck to be made for the vast majority of us. Its going to be left to hard work and smart investing. As Sam Walton once said of his successful chain of Walmart stores in America, they were a 20-year overnight success.

This book is a comprehensive overview of the financial advice process culminating in the one-page financial plan in the final chapter. It is specifically designed to be generalist in nature, giving an overview of all of the issues surrounding money management for those of you who are starting out to those who are seasoned investors seeking some tactical tips for immediate financial gratification.

Readers deserve a sincere, reliable and trustworthy guide to money management and this book will give you a thorough overview as well as providing a definitive, credible and practical guide to teach you how to build and manage your wealth like I manage mine.

If you create the habits now that lay the foundations for sound financial progress, you will have a far greater chance of financial success over time. Gambling your money on low-value shares, CFDs or options with the hope of vast overnight gains or investing into cheap properties interstate is not the elixir to financial freedom, and it is rarely the foundation for a sound beginning. Carefully planning your strategic approach, educating yourself on the options and making the odd mistake is so important in the learning process.

I was lucky in seeing my father lose out on a property rezoning deal and we lost our house in outer Melbournes Kangaroo Ground when I was just five, but I remember it distinctly because we moved around rented houses for a while and then up to Sydney so Dad could start a new and very successful career. The fact that we had no money was a pivotal issue in my life and I learnt from both my fathers mistake and his subsequent successes. Mistakes are important and if you hold back from fear of mistakes you risk making the biggest mistake of all: doing nothing. Be proactive and humour your shortcomings and hardships. You will eventually succeed if you persist.