Monthly Archives: August 2019

What you will doesn’t cover

Do you know what your will doesn’t cover?  Many people don’t. 

A will cover assets in your own name.

It therefore doesn’t cover:-

  • Jointly held assets such as bank accounts and the family home they go straight to the surviving partner).

  • Assets held within discretionary trusts.

  • Super (see future article).

  • Life insurance policy (goes to the owner).

Some people own everything in their own name.

On the other hand, other people have little in their own name. It is no uncommon to see a millionaire under age 65 have little in their own name, particularly if they are in business or can be sued for other reasons.

Everyone should have a will. It is your chance to set out who your assets are to be distributed to.  Proper planning ensures this is done in the most efficient and tax effective manner.  You therefore not only need a lawyer but often a financial planner as well.  It should never be done on the cheap if the bulk of your toil and investments reside in a trust or self managed super fund.

 

Bad debts are death

Bad debts are death particularly if you trade on narrow margins.

A bad debt of a $1,100 invoice will not have a GST impact if you are registered on a cash basis.  But a $1,000 of income at a 20% margin will require another $5,000 of sales to cover that loss.

So think twice before selling to customer who you doubt will pay you. 

Or perhaps take payment up front.

Or perhaps set up a payment facility and don’t do anything until accepted.

Or ring us as we have dozens and dozens of solutions and strategies gained from years of dealing with different clients in all sorts of industries.