STATEMENT OF ADVICE. Prepared for Jerry Seinfeld&Elaine Benes

Transcription

1 STATEMENT OF ADVICE Prepared for Jerry Seinfeld&Elaine Benes Prepared by Greg Einfeld (AR ) Lime Wealth Pty Ltd (AR ) ABN Trading as PlentyPlus Authorised Representative of Lime FS Pty Ltd AFSL ABN GPO Box 5311 Sydney NSW October 2017

2 PART 1 - INTRODUCTION About Plenty Plus Plenty Plus specialises in providing simple, high quality financial advice on individual topics. We work in conjunction with professionals such as accountants and superannuation administrators. Our director and financial adviser is Greg Einfeld. Greg is a qualified actuary with over 20 years' experience in the superannuation industry, and specialises in Self Managed Superannuation Funds (SMSFs). Scope This document provides advice in relation to whether you should establish an SMSF. It includes related topics such as rolling over your super into the SMSF, and the establishment of a bank account within your SMSF. It does not provide advice in relation to any other aspect of your financial situation. You have acknowledged that our advice will be limited to this area and will not take into account your complete financial situation. If you are seeking broader advice then please let us know, and we will refer you to another financial adviser who can meet your needs.

3 PART 2 - OUR ADVICE TO YOU Establish a Self Managed Superannuation Fund (SMSF) You have asked us if it is appropriate for you to establish an SMSF. In my opinion it is appropriate given your circumstances, and I recommend that you do so. I have formed this view for the following reasons: 1. You have $ 670,000 available in your existing superannuation funds to rollover into an SMSF. 2. You have experience managing investments 3. You would like to invest in asset classes that are not available in your existing super fund. 4. You would like to invest in listed securities.while these are available in your existing super fund, there are restrictions in doing so. 5. You would like to optimise the tax in your super fund 6. You would like to take advantage of advanced estate planning opportunities with your super. 7. The cost of operating an SMSF will be less than the current fees you are being charged, over the next 5 years 8. You are willing to spend 5+ hours per month managing your fund, which should be sufficient to meet your obligations. 9. You are eligible to be the trustee of an SMSF. You should be aware of the legal and administrative responsibilities you will have once you have established your SMSF. When you commence your SMSF, you will be required to sign this Trustee Declaration which sets out those responsibilities. Further information on establishing and operating SMSFs is contained in this video series, prepared by the ATO. In addition, here is a free course we have put together, on running your own SMSF. You are welcome to share this with your friends. Roll over your Superannuation into the SMSF Once you establish your SMSF, we recommend that you roll over your superannuation from your existing fund(s). A rollover is a transfer of superannuation monies from one fund to another. For a small additional fee, Plenty Plus can assist with rolling over your super. Jerry Seinfeld : It is important to recognise that you may have life insurance (possibly including "income protection" and "total and permanent disability" insurance) within your existing super funds. By transferring your entire balance out of those funds, and/or by notifying your employer to pay contributions into your SMSF, you may lose your existing insurance.

4 Based on the rules of your existing fund, we recommend the following for your rollovers: Member Organisation Amount to leave in this fund Elaine Benes Australian Super $ 0 Jerry Seinfeld Amp $ 10,000 We also strongly encourage you to undertake an insurance review to ensure that you have appropriate insurance in place, in the most tax effective and cost effective manner. We would be pleased to assist you with a review of your insurance arrangements at no additional cost. Jerry Seinfeld - Your ongoing contributions are currently going to Amp,we recommend these go into your SMSF once it's established Elaine Benes - Your ongoing contributions are currently going to Australian Super,we recommend these go into your SMSF once it's established Establish a Trustee Company Prior to establishing your SMSF, you will be required to determine the trustees of the fund. While the trustee(s) can either be individuals or a company, we recommend that you have a company as your trustee. A company trustee has a number of benefits over an individual trustee, including: 1. Less administration and cost when you add or remove members 2. Less administration and cost when a member passes away 3. Reduced fines if you breach the SMSF rules 4. Limited liability 5. Easier ability to borrow to buy property in your SMSF Setting up a new special purpose company (as opposed to using an existing company) will ensure that the company is eligible to act as an SMSF trustee, and will incur a lower annual ASIC fee relative to most other companies. The directors of the trustee company should be the same people as the members of the SMSF. The professional who helps you set up the SMSF will also be able to assist with the company establishment. The trustee company should be established before the SMSF. Establish a bank account You should establish a bank account in the name of the superannuation fund. This is the account into which all contributions, rollovers, and investment income will be paid. Any expenses, tax, and superannuation withdrawals will come out of this bank account. It is important to keep the SMSF's money separate from your own, and for that reason you will not be able to operate your SMSF without a bank account.

5 Develop an Investment Strategy You should develop an Investment Strategy that sets out how you plan to invest the assets in your SMSF. It is important that your actual investments are in accordance with the Investment Strategy. The Investment Strategy should also confirm that you have considered appropriate insurance arrangements. It is good practice to review your Investment Strategy regularly, and at least annually. Outcome of our advice By taking on board our advice, you will be better off for these reasons: You will be able to make investment decisions yourself. In your existing super fund(s), the investment decisions are made for you by the trustees. While you can select from a menu of investment choices, the trustees are investing on behalf of thousands of members, so they can't take your individual preferences into account. In contrast, you will act as the trustee of your SMSF, and will therefore make the investment decisions yourself. You will have a broader set of investments to choose from. At present your choices are limited to the menu provided by your existing super fund(s). Your SMSF will be able to invest into any asset of your choice, as long as it is in line with the Investment Strategy and restrictions in the Superannuation Legislation. Those restrictions are explained in the video series referenced earlier in this document. Your super will be managed in a more cost effective manner. In the long term, the fees you pay will be less than the fees in your existing fund(s). In some circumstances, by having an SMSF you may be able to better manage and reduce the amount of tax paid. For these reasons, we believe that our advice is in your best interests, and that a reasonable financial adviser would agree. However, you should also consider the risks and disadvantages of establishing an SMSF.

6 Risks and disadvantages of our advice Being the trustee of an SMSF takes time and comes with responsibility. While you have demonstrated your willingness to spend the required time, it is important that you understand your responsibilities which are described in the Trustee Declaration and videos referenced earlier in this document. There are costs associated with operating an SMSF. These include: Initial costs to set up the SMSF. This includes obtaining a Trust Deed and establishing a trustee company. This cost is typically around $2,000. Annual costs to ensure your SMSF remains compliant. This includes accounting, tax return preparation, audit, ATO SMSF levy, and possibly obtaining an Actuarial Certificate. These costs vary from one SMSF to another, and are typically around $3,000 p.a. Offsetting these costs are the costs you are currently paying to your super fund(s) which are $9,933 Winding up the SMSF. At some stage you may need to wind up your SMSF. The most common reasons for winding up are death or loss of mental capacity of the members, moving overseas, super balances reducing in retirement, and loss of interest in controlling and administering the SMSF. The typical cost of winding up is around $2,000. While you are not planning to wind up the SMSF in the near future, you may want to develop an exit strategy for your SMSF. Investment and broader financial advice. The scope of this Statement of Advice does not include advice in relation to investment, pensions, contributions, or any other aspect of operating your SMSF on an ongoing basis. We recommend that you obtain additional advice in these respects from Plenty Plus or another adviser. Note that Investment, pension and contribution advice may also be appropriate if you remain in your existing superannuation fund. Insurance. Your SMSF is able to obtain life and disability insurance on your behalf, and will be required to pay premiums as a result. SMSFs do not have access to compensation arrangements in the case of fraud or theft SMSFs do not have access to complaint mechanisms such as the Superannuation Complaints Tribunal The superannuation laws may change at any time, which could affect the way you operate your SMSF. If for any reason you are concerned that this advice is not in your best interests or is not appropriate to your circumstances and financial objectives, you should not act on this advice and you should inform me/us of your concerns in writing immediately.

7 PART 3 -THE INFORMATION YOU PROVIDED TO US You Partner First Name Jerry Elaine Surname Seinfeld Benes Date of birth 01 Jan Jan 1972 Annual Salary $155,000 $135,000 Other Income $0 $0 Super Balance $385,000 $295,000 Hours per month spent looking after your SMSF Advised to make voluntary contributions to super in the next 12 months? Eligible to be a trustee? Own investment assets? What investment assets? 5+ hours No Yes Yes Shares Property Term Deposits Would the clients like to actively manage the tax position of their superannuation? What additional assets are the clients looking to purchase in their super fund? Yes Residential Property Overseas shares Exchange Traded Funds Would the clients like to use sophisticated estate planning strategies in their superannuation fund? More Important Yes Ability to Purchase Assets and Have Features

8 PART 4 - OTHER THINGS YOU SHOULD BE AWARE OF Capacity in which advice is provided Lime FS Pty Ltd ABN is the holder of an Australian Financial Services License, AFSL Lime Wealth Pty Ltd ABN (trading as PlentyPlus) is a corporate authorised representative of Lime FS Pty Ltd. Financial product advice is provided by Lime Wealth Pty Ltd in its capacity as authorised representative of Lime FS Pty Ltd and not in any other capacity. Greg Einfeld is director and majority shareholder of Lime Wealth Pty Ltd and is also an individual authorised representative of Lime FS Pty Ltd. Greg is authorised to provide advice in the following areas: 1. Financial Planning 2. Deposit and Payment Products - Basic Deposit 3. Deposit and Payment Products - Non-basic Deposit 4. Government Debentures, Stocks and Bonds 5. Life Products - Investment Life Insurance Products 6. Life Products - Life Risk Insurance Products 7. Managed Investment Schemes including IDPS 8. Retirement Saving Account Products 9. Securities 10. Superannuation 11. Tax Understanding your SOA The Corporations Act in effect says you must be able to understand the concepts, words, phrases and sentences used in your SOA. If you do not understand a concept, word, phrase or sentence used in your SOA then you should ask us for a further explanation so that you do understand it.you should not act on any advice in this SOA unless you understand the advice. Referral arrangements and fees We do not have any referral arrangements which could influence our advice,and we have not paid any person for referring you to us, unless we have disclosed these fees elsewhere. Conflicts of interest We do not have any relationships that may create a conflict of interest that would influence our advice to you.

9 Salaries to staff and other services to you The payment of staff salaries does not influence our advice in any way. The provision of other services (such as accounting services) does not influence our advice in any way. Incomplete, inconsistent or inaccurate information Our advice is only as good as the information you provide to us. If you have provided incomplete, inaccurate or inconsistent information, then that could impact the quality of the advice we provide. Hence, before acting on the advice, you should consider the appropriateness of the advice, having regard to your objectives,financial situation and needs. You should not rely on our advice and you should contact us immediately to provide complete and accurate advice if the information you have provided to us is incomplete or inaccurate. We will then prepare a further SOA for you. Financial service guide ("FSG") You have received a copy of our FSG and you may request a further copy of our FSG at any time. Our FSG sets out certain information required under the Corporations Act and your responsibilities as a client and the provisions of the FSG are terms and conditions of our contract. Our FSG may change from time to time and where it does the provisions of the new FSG are automatically included as terms and conditions of our contract. Protection of personal information. Your personal information is protected by the privacy laws. Our Privacy Policy sets this out in further detail. The Corporations Law requires your personal information to be retained by us for seven years. Scope of advice Your SOA only relates to the specific matters contained in it and does not aim to cover all aspects of your financial profile. We are not responsible for any matter not covered by this statement of advice or any other matter potentially impacting your financial profile. Time limits and responsibility for implementing our advice You should not act on any recommendation after one month of the date of the SOA without our written confirmation that our recommendations are still suited to you.no responsibility will be taken for any advice acted on after one month without our separate written confirmation that the advice is still suited to you.we will not be responsible for any losses connected to our advice if it is not implemented by us, if you do not engage us as your adviser, or if you cease to engage us as your adviser. Your goals and objectives Your SOA will help you achieve your goals and objectives, however, we do not guarantee your goals and objectives will be met. This will depend on the general economy, the regulatory environment, numerous decisions you make, and the performance of the financial products. These matters are not within our control.

10 Unusual Circumstances If you have any unusual circumstances, or anything you think we should be aware of that we have not asked you about, then this might influence the advice we have provided. We are unable to take these circumstances into account if we are not aware of them. If this is the case then please advise us before you implement any of our recommendations. We will not be responsible for the outcome if we are not aware of these circumstances. Tax advice You undertake to obtain separate written advice from a registered tax agent or solicitor regarding the income tax implications of any proposed transactions, before implementing your SOA. You indemnify and release us from any responsibility and loss caused to you or any related person as a result of any failure to obtain this advice. Information about Classes of Products The information provided in the links below explains the various classes of financial products. This forms an important part of our advice to you. This information is sourced form ASIC. Life Insurance Superannuation and Retirement Self Managed Superannuation Funds Life Insurance inside Superannuation Managed Funds Shares Property International Investments Consequence of replacing or switching one financial product with another As part of our advice, we have recommended that you establish an SMSF and rollover money from your existing super funds. These recommendations are considered to be "switching" from one financial product to another. The advantages and disadvantages of these switches are disclosed and discussed above. In recommending the switches: 1. We have considered your existing products 2. There are switching costs which are small relative to the ongoing fee savings and higher expected returns 3. We are not aware of any benefits that might be lost 4. We are not aware of any other significant adverse consequences of these switches. The financial information relating to these switches is shown below. Existing Products($) Recommended Products($) Super investment and admin p.a. $9,933 N/A SMSF accounting p.a. N/A 3,000 Transaction costs - once off $0 N/A

11 What are our fees? Our fees are summarized in this table: Description Fee (incl. GST) Preparation of this SOA $99 Rollover, per transactions (optional) $110 Establishment of bank account (optional) $110 Discuss advice over video conference (optional) $132 Insurance review $0 The above summary is a full and complete disclosure of all fees and commissions payable to us in connection with the recommendations in this SOA. Best interests duty and the appropriateness of our advice We believe this advice is in your best interests and appropriate to your circumstances. It is likely to leave you in a better position financially than you would be otherwise. Next Steps The next step is for you to read and understand this statement of advice and the recommendations it contains, in conjunction with the professional who will help you establish your SMSF. You should contact me immediately if for any reason you do not understand any part of this advice, or would like to discuss it further. An additional fee will apply to set up such a meeting. Please also note that we have provided our advice based on the information you provided to us. If this information changes in any way then we recommend that you obtain updated advice. Yours sincerely Greg Einfeld Director Lime Wealth Pty Ltd trading as Plenty Plus Authorised Representative of Lime FS Pty Ltd AFSL