true wealth SEPTEMBER 2014
+COUPLES & CASH How to manage your finances
+TAKING CONTROL
Why you need life, disability, income protection
IN FOCUS THE TRUE COST OF HEALTHY LIVING
THERE IS NO WEALTH LIKE PEACE OF MIND. OK, LOTS OF MONEY WOULD BE NICE TOO.
We all know money can buy us freedom. But nothing can free the mind like knowledge. That’s why we’re dedicated to educating our members. It’s all about empowerment. By this we don’t mean sending you a yearly letter stuffed with information. From the start of your career through to retirement, our people are there to guide you along the way. We have dedicated professionals available to talk over the phone even late into the evening. Our online education tools and services will also allow you to build your knowledge at a pace that suits you. We offer seminars and workplace sessions right across the country. If you wish, we’ll even come and talk about your financial plans in person at your workplace. True wealth, as our members will tell you, starts with a wealth of knowledge. For more information visit ngssuper.com.au or call 1300 133 177.
Issued by NGS Super Pty Limited ABN 46 003 491 487 AFSL No 233 154 the Trustee of NGS Super ABN 73 549 180 515
WELCOME Hello and welcome to the first edition of our new member magazine, True Wealth. You may have noticed that NGS Super has undergone a recent makeover—we have a new logo, a new website and a fresh look. At NGS Super our guiding philosophy is ‘dedicated to the dedicated’ and one of our values is ‘doing it better’. Our new look and magazine are both examples of our dedicated and constant endeavour to improve what we do. True Wealth is another way in which NGS Super seeks to help you to enjoy wealth in every sense of the word. This publication has been designed with your interests and needs in mind and offers a variety of articles that focus on the many facets of true wealth. You’ll find lifestyle articles to help you lead a more fulfilling, enriched and wealthy life as well as money-related articles to increase your financial knowledge and help you to build your financial confidence. At NGS Super we believe that knowledge is the key to building your personal wealth and with this in mind, we hope you enjoy our first edition.
NEWS & NOTES
Tidbits from teaching kids financial literacy to how you can increase your super.
THE TRUE COST OF HEALTHY LIVING
If your bank balance is low it’s tempting to put your own wellbeing in the too-hard basket. So how do you stay healthy without it costing the earth?
KIDS UNPLUGGED
There’s lots that parents and teachers can do to develop healthy digital habits in childhood.
COUPLES AND CASH
Love may be blind, but when it comes to managing money in a relationship it pays to go in with your eyes wide open.
REGAINING STRENGTH
How NGS Super’s insurance cover helped a member when she needed it most.
CONNECT WITH COMMUNITY
Giving to charities through your workplace can sharpen your skills, strengthen your team and deepen your sense of purpose.
13 MANAGING YOUR MONEY
NGS Super has strong lines of defence to lessen investment risks.
www.ngssuper.com.au
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THE TRUE WEALTH TEAM NGS Super
Sophie Horwood Marketing Manager
General Manager Clare Brundle
Editor Sophie Hull
Designer Harmony Southern
Cover image Getty Images
Lisa Samuels Manager, Marketing and Strategy
Published by Hardie Grant Media
Head of Content Mark Scruby
Art Director Dan Morley
Illustrations Kev Gahan
Print Offset Alpine Printing
The information in True Wealth is general information only—it does not take into account your objectives, financial situation or needs. Please assess your own financial situation, read the Member Guide (PDS) for any product you may be thinking of acquiring and consider seeking professional advice before acting on this information.
+++ The averag e num b e r o f steps Aust aged 5 -17 ye ralians ars take eac h day, acco to the inaug rding ural Active Healthy Kid Australia 20 s 14 Report C ard.
Beating breast cancer In May, more than 125,000 Australians joined the Mother's Day Classic walk and run. Each year the Mother’s Day Classic event raises money for breast cancer research. These funds have had a very real impact on survival rates—a 17 per cent increase since the early 90s, to 89 per cent. The money raised has farreaching positive benefits such as helping to provide support for the physical and emotional wellbeing of women with breast cancer, as well as funding a range of research projects including enhanced detection and improved treatment options. Other projects include investigating the efficacy of 3D breast screening and improving chemotherapy effectiveness.
NEWS Languages boost brain age Learning a second language could keep your brain sharper for longer. Tests at the University of Edinburgh suggest that those who speak more than one language had significantly better thinking skills later in life when compared to predictions from IQ results in childhood. The good news is that it’s not too late to act on the findings—the benefits were still seen in those who learnt their second language as adults. 2 + TRUE WEALTH
Update your snail mail NGS Super now offers e-statements. Those members who have a valid email address listed with the fund will receive their statement electronically. If you have not provided NGS Super with your email address and would like to receive an e-statement (instead of a hardcopy) please call 1300 133 177 or login to your secure Member Online account to provide your email address.
Congratulations to the winners of NGS Super’s recent ‘true meaning of wealth’ Facebook competition: Hatice Onay (NSW), Bruce Russell (Vic), Hayley Nash (NSW), Heidi Kerr (SA) and Janelle Stacey (ACT). The winners listed spending time with loved ones and volunteering as valuable to them. Visit www.facebook.com/ ngssuper for more great competitions.
+ INSPIRATIONAL READS This Is the World (Rizzoli, $55) is a compilation of M. Sasek’s classic children’s travel books. It is a charming illustrated journey through the world’s greatest cities, from London to San Francisco, which will inspire travellers of all ages.
NEWS & NOTES
+ COMBINE YOUR ACCOUNTS TO SAVE MONEY Having more than one super account means that you’re paying more in fees, have more paperwork to manage and may potentially have less wealth at retirement. At NGS Super, it is now easy to consolidate your super. You do not need to complete any forms or provide certified identification, you just need your membership number and the name of
the fund that you would like to roll money out of. If you have not provided NGS Super with your Tax File Number, you will need that as well. To get started, login to your secure Member Online account at www.ngssuper.com. au/login and click on ‘Contributions’ then ‘Rollovers/Transfers in’ and lastly ‘Online rollover request’.
We chat to Sinead McKechnie, NGS Client Relationship Manager. What does your role involve? I am on the road visiting members at their work sites and helping them better understand their super. For example, many members want to know more about their investment and life insurance options. What is the most satisfying aspect of your job? I just love seeing that you’ve been able to leave someone better informed. There are no sales pressures, the members are just given information and they can decide what they want to do with it. At NGS Super we don’t just talk the talk. The staff really do live and breathe the values of the fund.
Aussie kids’ know how
Young Australians are ranked third in the world for financial literacy, according to a recent report. The Organisation of Economic Cooperation and Development (OECD) assessed 29,000 teenage students from 18 countries on their knowledge of personal finances and solving financial problems. The report found 82 per cent of Australian students have a bank account and 73 per cent earn money from work. Australia had similar results to Estonia and New Zealand, behind leaders Shanghai-China and the Flemish Community of Belgium. Miles Larbey, Senior Executive Leader of ASIC’s MoneySmart, says that with guidance, even young children can learn valuable lessons about money:
IMAGE: CORBIS
+ Help children become familiar with coins and notes. A fun way to do this is by letting them pay for items when you’re out shopping. + Discuss that credit is borrowed money that you need to pay back and that paying it back will cost more
than saving for what you want. + Talk about needs and wants, especially when children ask for things. Is it something they really need, or something they can live without? You can encourage good behavior by demonstrating that you are willing to put aside personal
What questions are you often asked? When can I access my super? Everyone wants to access it now but most people have to wait until they retire. Members also want to know about the benefits of making voluntary contributions and how that works with tax. wants in order to meet the needs of others. + Ask them to help you plan a meal within a fixed budget. Discuss with them which items are the most important and why. Help them compare brands to minimise costs and meet the budget.
Visit NGS Super’s ‘Teaching Kids About Money’ module on the MoneyCoach learning centre at www.money101.com.au/ngs for more tips.
How can we improve our financial literacy? There’s always ways to improve. NGS Super has great tools online so people can educate themselves, which is particularly valuable for regional members. Or you can just give us a call—the helpline can give you limited advice and refer you to personal advice through NGS Financial Planning. To request an NGS Super visit to your workplace, call 1300 133 177.
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FAMILY
THE TRUE COST When your bank balance is low, it’s tempting to put your own wellbeing in the toohard basket. But it doesn’t have to be that way, reports Hazel Flynn.
W
hen times are good and money is plentiful, you probably don’t think too much about the cost of yoga classes or gym membership or the price tag on premium food. During leaner times those things can seem like luxuries; they’re often among the first to go when expenses are being cut back.
That’s fair enough, but problems arise when instead of heading out to the Pilates class that now seems too pricey, you do… nothing. And instead of buying farmers’ market carrots or organic grapefruit you decide to cheer yourself up with some junk food, seeing it as an inexpensive treat. That kind of thinking is understandable, says personal trainer Edwina Griffin, but ultimately it’s a choice you will regret. In fact, the more stressful your situation, the more you should invest in your own wellbeing. And it doesn’t have to cost a cent. “One of the biggest stresses is financial stress,” says Edwina, founder of Real Body Management and former NSW Exercise Professional of the Year.
“It sends your cortisol levels up and shifts your hormonal levels. To cut out all your fitness and health regimes when you’re already feeling that pressure contributes to stress rather than releasing it. The bottom line is the longer we have high levels of stress, including financial stress, the more serious disease can affect our bodies. Put a lack of exercise together with the kinds of nutrition choices people can make under stress and you get a highly acidic, toxic environment which is perfect for disease, cancers in particular.” The good news, she says, is that there are many options for staying fit that are free or low cost, and the benefits are mental as well as physical.
LIFESTYLE
IMAGE: CORBIS
FIND A BUDDY, DO IT WITH A MATE. YOU MAKE A COMMITMENT AND YOU’RE ACCOUNTABLE TO YOUR FRIEND. “There’s one thing you can control in stressful times and it’s your treatment of yourself. Even though going for a workout might be the last thing you feel like doing, maintaining an exercise regime can actually be the thing that gets you through. The after feeling—how much better you feel when that exercise has shifted your brain chemistry—that’s what people need to remember.” As for exercise options that don’t bust the budget, the choices are plentiful. “It doesn’t have to be a gym membership and you don’t need expensive equipment. It can be going down to your local park. It can be dancing to your favourite music at home. Get the rollerblades out if you have them. There’s so much you can do that costs nothing.” Phone apps and online exercise programs come in both free and paid versions. Many are excellent and the key is to check the credentials of the person who devised the program. And if you’re lacking motivation, “Find a buddy, do it with a mate. You make a commitment and you’re accountable to your friend. It can be just as motivating as a trainer, if not more,” says Edwina. Quitting smoking is an obvious way to improve your savings and health. If you smoke one pack of cigarettes each day for ten years, you’ll spend over $58,000—easily enough to buy a new car or put a deposit on a house. You’re also more likely to suffer from colds right through to heart attacks and cancer, according to the Victorian Government’s Better Health Channel. The other important part of staying healthy is your food choices. Karina Bray from the independent consumer advice
organisation Choice says that knowing your food facts can save you money. “We hear a lot of talk about superfoods, many of them very expensive, such as chia seeds. But you don’t need to eat those. A lot of very cheap and common everyday foods like apples and wholegrains are actually superfoods, delivering big nutrient hits.” Karina says it’s also worth thinking twice about the brands you buy. “There is still a perception that brand names are better quality than generic brands, but that’s not necessarily the case. When it comes to basics like sugar, salt, flour and some tinned foods, the generics are just as good.” And don’t look down on frozen fruit and veg. If, like many Australians, you regularly find yourself throwing out food that has gone bad, buying frozen can prevent waste and thereby save money. As for paying more for organic, Choice says that eating the recommended five serves a day of fruit and veg has a much greater impact on health. But perhaps the single biggest thing you can do to help your grocery bill and your health is to just walk past junk food. “Don’t buy soft drinks, chips, biscuits and confectionery. And unless you live in an area with undrinkable tap water, don’t buy water,” says Karina. Beyond the immediate financial costs of healthy living, there is also the long-term effect to our physical and mental health we can’t put a too high value on. When it comes to priorities, both in terms of finance and life choices, maintaining your health is the best investment you can make.
Sim ple Savings The dos and dont's for both food and fitness.
Food
To reduce healthy eating costs, Karina Bray says: + Do cook extra meals and freeze them, so you don’t resort to junk takeaway on those ‘can’t be bothered’ nights. + Don’t just rely on vitamin supplements, which can be expensive. A well-balanced diet will provide you with most, if not all, of your nutritional needs. + Do shop from the perimeter of the supermarket. This is where you tend to find the unprocessed foods, which tend to be better for you and potentially less expensive.
Fitness
To keep fit for less, Edwina Griffin recommends you: + Don’t think you need gym equipment to work out effectively. + Do explore free options such as the 5km park runs held in locations around the country (www.parkrun. com.au) or Heart Foundation walking groups (www.heartfoundation.org.au). + Don’t think it’s all or nothing when it comes to a workout. Even a quick 20-minute session will be enough to shift that brain chemistry, get your heart rate up and give you some benefit.
TRUE WEALTH
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KIDS F
rom smartphones to tablets, computers and of course, television, children now have access to a wide variety of digital toys. The Australian Bureau of Statistics reports that on average children aged 5-17 spend more than two hours a day doing screen-based activities—and just under 50 per cent of children have at least one screen-based item in their bedroom. Understandably, many parents and teachers worry about the amount of time their children spend in front of screens. So how much is too much and what can you do to cut back? Compared to toys, people and other stimuli that children are typically exposed to, screens offer an inviting multi-sensory experience. “The visual images change, there are sound effects and there’s fast paced action which attracts the senses,” says Dr Kristy Goodwin, director of Every Chance to Learn. “Screen time is very different to what children are normally exposed to. For example, young babies look at toys that only move if they touch them, but all of a sudden they have screens that are multi-sensory without them necessarily having to do anything to interact with them.” The health conditions associated with sedentary behaviour— most notably obesity—are the obvious risk of too much time in front of digital devices, as screen time often means less time is spent on active play. Dr Goodwin calls this an opportunity cost. “My big concern with children and screen time, regardless of how much they have, is that it has a displacement effect,” she says. “For young children who have limited waking hours, if they’re engaged in too much screen time, they’re not hanging off monkey bars and they’re not engaging in independent play.” The effect of screen time on children’s sleep is another concern. “When children use screen devices in the 90-minute period before bed they have sleep delay and over time these accumulate and result in a sleep deficit,” says Dr Goodwin. Screens are backlit with blue light, which stops the body from producing the sleep hormone melatonin. This can affect adults but it is thought to be more pronounced in children as they rely more heavily on melatonin to get to sleep.
6 + TRUE WEALTH
Frequent use of digital devices can also mean children are exposed to age inappropriate content. “There is evidence that if young children are being exposed to R-rated games, this can have a detrimental effect to their attitudes towards women, race and even aggression,” says child and adolescent psychiatrist Dr Philip Tam. The Department of Health recommends that children under the age of two don’t spend any time with electronic media and those aged two to five be allowed a maximum of one hour per day. But rather than focusing on quantity, both Dr Goodwin and Dr Tam say the quality of digital interactions has a more significant impact. “There’s lots of evidence that suggests when children use technology intentionally, in a really purposeful way at home or school, that children do learn,” says Dr Goodwin. This even applies to appropriate television programs and video games. She suggests developing a media plan for children so they know how much and what type of screen time is allowed. Dr Tam agrees: “The first thing I would do is set out ground rules for usage. For example, children can only use digital devices after finishing their homework or eating dinner with the family. On weekends they can’t use them all day and must balance indoor time with outdoor activities. The key point is balance.” Technology offers greater educational benefits when children play with others, so encouraging children to use technology with other children, teachers or parents—rather than flying solo—can improve the quality of digital downtime. This approach also offers benefits for cyber safety. Explore the internet with your children and discuss the kinds of sites that are appropriate to explore and those that are not. Consider using parental controls such as filters to help manage your child’s online access. And remember, children learn from the adults around them, so practising healthy media habits—like limiting screen time and leaving your phone in another room during dinner—will help children make better technology choices as they grow.
IMAGE: GETTY
Too much screen time can have negative health consequences for children, but there’s lots that parents and teachers can do to develop healthy digital habits in childhood. By Angela Tufvesson
DEVELOPING CHILDREN FAMILY
Make your child’s bedroom a screen -free zone so there is not a continual digital temptation.
Cut out cartoons before school which can overstimulate right before kids need to sit still and listen.
Stop screen time two hours before your child’s bedtime so it doesn’t interfere with their sleep.
Become an active participant—plan what your child views and watch with them.
COUPLES Love may be blind, but when it comes to managing money in a relationship it pays to go in with your eyes wide open. By Rebecca Douglas
I
t’s a scenario that would fill even the most loved-up with dread. What if your partner suddenly skipped out and left you with a huge debt? It does happen, and the effects, financially and emotionally, can be devastating. According to not for profit Relationships Australia, money is one of the leading sources of conflict for couples and financial troubles cause around 25 per cent of all relationship breakdowns. The good news is there are a few simple precautions you can take to help avoid this unhappy ending. 8 + TRUE WEALTH
Firstly, it’s handy to lay some groundwork at the beginning of the relationship. Make sure you can have frank, open discussions about money with your partner without World War III breaking out. Talk about your current financial situation, individual approaches to saving and spending and what you’d like to achieve together in the future. Are you hoping to start a family? Take time off to study? Retire at 60 and party on the French Riviera? Once you’ve sorted out these nuts and bolts, the next decision is who will be
handling the finances. Will one person pay the bills and balance the budget or will you share this role? Even if you’re taking a backseat on the budgeting and bill-paying front, it’s always wise to have a general understanding of your financial position. This is a lesson Brisbane mother Julie Rainbow learnt the hard way. She was left with a whopping milliondollar pool of debts when, after two years of marriage, she began to notice something didn’t add up. “As many women do, I trusted my husband to
WEALTH
manage our finances while I focused on my business and raising my young family,” reveals Julie. “But life soon began to unravel when I noticed my husband was not disclosing our true financial position. There were multiple debts to a long list of lenders. Devastatingly, this list included members of my family.” In the years following, Julie and her children experienced a dramatic change in lifestyle. She was hounded by debt collectors and forced to declare bankruptcy, eventually losing her award-winning business, working numerous jobs and living week-toweek to provide for her children.
IMAGE: THINKSTOCK
MAKE SURE YOU CAN HAVE FRANK, OPEN DISCUSSIONS ABOUT MONEY WITH YOUR PARTNER WITHOUT WORLD WAR III BREAKING OUT. She has since (mostly) recovered financially and started Clarity Road, an organisation to empower and inform women experiencing similar lifechanging events. Another vital phase is moving in together. Whether you’re renting or buying a house, be careful whose name will be on your bills and statements. It’s best to put both your names on utility bills like electricity and gas, meaning you will both be equally responsible. The same goes for other liabilities and big purchases like your home and mortgage or lease agreement. Additionally, insurers offer substantial discounts if you share a private health insurance plan for couples or take out multiple policies for car, home and other types of insurance
Miles Larbey from ASIC’s MoneySmart recommends the following steps for securing your post-breakup financial future: List all your assets and debts. Close off your joint accounts. Check that your pay is going into a separate account.
Gather all your financial documents, including credit card statements, superannuation accounts, tax information, insurance policies, investments and property deeds.
Ask for support from family and friends. They may be able to share ideas on making your money go further. Speak to a solicitor to freeze joint accounts, separate property held in joint names, take legal action if property is held in your partner’s name and prevent its sale before the final property settlement.
Seek free legal advice and financial counselling.
Find out about potential Centrelink assistance.
The Department of Human Services can help explain your child support options and has a range of self-help tools. Sort out your super. Super is treated as a type of property and can be divided by agreement or by court order. The family law courts have more information.
Consider insurance, including car, home and contents, and income and life protection insurance, especially if you have kids.
all with the same company. You may also be able to divert some of your super to your spouse. However, it’s a risky manoeuvre to put your name on a loan where only your partner benefits, like their car. They could burn off into the sunset leaving you without a car, but with a nasty debt. Similarly, being a guarantor on their loan (e.g. for their business) means, like in Julie’s case, debt collectors could be hounding you to repay the debt long after your partner has left. Seek financial and legal advice before signing to suss out whether it’s a wise move in your situation. In the end, it may not be the most romantic topic, but being money-smart can help you live with some financial clarity, no matter what the future holds.
+ Australian Securities &
Investments Commission Call 1300 300 630 or visit www.moneysmart.gov.au + Department of Human Services Call 131 107 or visit www.humanservices.gov.au + Family Court of Australia Call 1300 352 000 or visit www.familycourt.gov.au + Financial Rights Legal Centre Call 1800 007 007 or visit www.financialrights.org.au + NGS MoneyCoach Online tutorials at www.money101.com.au/ngs + Relationships Australia Call 1300 364 277 or visit www.relationships.org.au
TRUE WEALTH
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WEALTH
Regaining
STRENGTH
How NGS Super’s insurance cover helped Alison when she needed it most.
A bright career cut short
Alison* was a secondary school teacher in Sydney. Her warm personality made her popular with both students and colleagues, and her well-planned classes made her renowned for keeping students happy and motivated. After a few years of teaching, Alison began to experience overwhelming anxiety. She became forgetful in the middle of class and was constantly needing to refer to her notes. She started to dread walking into class each morning, and her hand would tremble as she wrote on the whiteboard. Alison also had trouble sleeping and even though her diet was unchanged she began to lose weight. The popular and upbeat staff member everyone knew had changed into a stressed out, exhausted individual who struggled to get through the working week. She visited her doctor who referred her to a specialist where she was diagnosed with Graves’ disease. Graves’ disease is a condition that causes an overactive thyroid gland commonly leading to anxiety, insomnia and loss of appetite. Alison sadly resigned from her teaching role because of her condition. She was terribly upset about giving up a job she loved, and worried about how she would support herself. Fortunately, Alison had income protection cover through her NGS Super account, giving her an income when she needed it most.
Find out m ore
The road to recovery
Alison’s income protection cover paid around 75 per cent of her normal monthly wage while she was unable to work. This allowed her to take care of rent, bills and other living expenses while she focused on getting better. While Graves’ disease is manageable, getting better was a slow process. Her specialist prescribed Alison antithyroid medication, which had promising results, however the illness had severely shaken her confidence. As part of her income protection insurance, CommInsure arranged rehabilitation for Alison through WorkCom. They assessed her experience and skills to help her discover a career that she would enjoy and that was suited to her situation. WorkCom also helped Alison to sharpen her job seeking skills, which supported her to start looking for work again. To help her recover from her severe anxiety, WorkCom also referred Alison to a psychologist. This helped her to manage her condition and helped rebuild her confidence so she could return to work. The cost of her rehabilitation program was covered by her insurance.
A new start
After taking the time she needed to regain her strength, Alison found a job as a part-time activities officer in an aged care facility. She was thrilled to be back at work making a positive difference to people’s lives. Since then, Alison has been working on gradually increasing her work hours, while keeping her Graves’ disease and anxiety under control. Thanks to the support of NGS Super and CommInsure, Alison looks set to get her life back on track, turning a serious misfortune into a temporary setback.
To learn more about insurance cover through NGS Super, visit www.ngssuper.com.au/insurance or call 1300 133 177.
10 + TRUE WEALTH
*NAME AND OTHER PERSONAL DETAILS CHANGED TO PROTECT IDENTITY OF CLIENT. IMAGE: GETTY
W
hen you’re fit and healthy, insurance protection is usually the last thing on your mind. But no one knows what the future holds, and an unexpected illness or injury can easily turn your life upside down. Fortunately NGS Super and CommInsure can be a real lifesaver.
FAMILY
ALISON’S INCOME PROTECTION COVER PAID AROUND 75 PER CENT OF HER NORMAL MONTHLY WAGE WHILE SHE WAS UNABLE TO WORK.
SOCIAL RESPONSIBILITY
COMMUNITY
Work can bring so many pressures, schedules and deadlines that it’s easy to lose sight of the bigger picture. “Our professional lives don’t always enable us to make a difference to causes dear to our heart,” says Meredith Fuller, registered psychologist and spokesperson for the Australian Psychological Society. “Research shows that ‘selfless’ activities like workplace giving create a strong sense of being valued for who we truly are.” According to Meredith, workplace giving programs can also increase skills, build team cohesion and boost productivity. All of which are beneficial to employers. If you want to forge links close to home, contact your local council, community centre, chamber of commerce or service club to find out about ways to help in your area. If you prefer to focus on financial donations, investigate the benefits of an online giving platform like Good2Give, which enables individual employees to donate to Australian charities of their choice through pre-tax salary contributions. “It’s easy 12
+ TRUE WEALTH
to say, ‘I can only afford $20 a month—that won’t make much difference,’ says Lisa Grinham, CEO of the Charities Aid Foundation (CAF), which operates Good2Give. “But small amounts from lots of people can really add up.” Is volunteering your preference? Organisations such as Volunteering Australia (www.volunteeringaustralia.org) and their initiative Go Volunteer (www.govolunteer.com.au) can provide tips on how to get started, and connect you with opportunities to make a real difference. Think about the charities that you and your colleagues would like to support, along with your employer’s time and resources. Do you want to help local organisations, or have a wider impact? What’s more effective: financial donations, hands-on assistance or a combination of both? What’s more practical: giving regularly, or supporting specific events like fundraising drives and awareness weeks? To make your giving program more rewarding and effective, make sure your colleagues and employers understand the tangible benefits involved. Pre-tax donations through platforms like Good2Give, for example, reduce your taxable income upfront. You can also track the amount going to your preferred charities from all donors in your workplace. “These are great motivators for colleagues,” says Lisa.
IMAGE: CORBIS
Giving to charities through your workplace can strengthen your team, deepen your sense of purpose and help provide muchneeded services. Fiona Marsden reports on the top five ways to get started.
WEALTH
Managing
YOUR MONEY
NGS Super has strong lines of defence to lessen investment risks.
NGS Super takes the responsibility of managing your money very seriously. From an investment perspective, this means that there is a continuous focus on risks while balancing wealth accumulation and wealth preservation. The company believes that rather than making more in positive investment periods, better outcomes can be achieved by adding safeguards for difficult investment periods. In essence, there is little point in growing wealth if you cannot preserve it. Most of the risk in a well-diversified portfolio comes from the share (equity) markets due to the volatility (the degree to which the market moves up and down). From July 30, 2014, NGS Super added additional market volatility protection to manage this equity risk in some of their investment options: Diversified (MySuper) – super default, Defensive, Balanced and High Growth; as well as the NGS Income Stream (Pension) options: Diversified, Defensive, Balanced, High Growth, Moderate Growth – Income Stream default and Income Generator.
The normal allocation is indicative of the expected asset allocation during stable market environments. The tactical allocation range is used to respond to changes in the investing environment. The full range (including equity risk management) is used during times of high equity market volatility. An additional equity risk management process is used to reduce equity market exposure.
Strategic asset allocation—selecting fit-for-purpose investments The strategic asset allocation is the choice of the underlying investments and is the primary driver of the option’s long-term investment performance. The investments selected have one or more of the following characteristics: + capital preservation + regular stable income + inflation offset + capital growth + risk mitigation. Tactical asset allocation—selecting the right assets for the environment The tactical investment allocation range is used to respond to changes in the investing environment. This strategy moves asset allocations dynamically, seeking primarily to manage risk, but also to improve returns. To assist with this process, a proprietary macro indicator, the State Street Global Advisors Market Regime Indicator (MRI) is used. The MRI seeks to identify investment markets’ current appetite for risk by analysing equity, fixed income and currency price volatility. For example, during periods where markets
show a low appetite for risk, the options will generally hold less risky assets. The option’s asset allocation is adjusted dynamically by observing a daily reading of market risk appetite. Equity (share market) risk management An additional equity risk management process is used to reduce equity market exposure during times of high share market volatility. In addition to the tactical allocation process above, the strategy also seeks to scale down equity exposure when short-term market volatility exceeds predefined levels. A proprietary Targeted Volatility Trigger (TVT) strategy is used for this process. The TVT aims to reduce equity exposure during periods of high volatility when the options are most vulnerable to an equity market fall. The equity risk management process is normally implemented using derivatives. You can see how these lines of defence operate in the table below for the Diversified (MySuper) option for super and the Diversified option for income streams.
GROWTH
70%
55-85%
25-85%
Australian shares
32%
20-45%
5-45%
International shares
26%
20-40%
5-45%
Private equity
3%
0-6%
0-6%
Property (growth)
2%
0-8%
0-8% 0-15%
Infrastructure
7%
0-10%
Growth alternatives
0%
0-10%
0-15%
DEFENSIVE
30%
15-45%
15-75%
Bonds - Fixed interest yield
5%
0-10%
0-25%
- Fixed interest duration
8%
0-20%
0-25%
Property (income)
7%
0-15%
0-15%
Defensive alternatives
5%
0-10%
0-15%
Cash
2.5%
0-25%
0-30%
Term deposits
2.5%
0-25%
0-30%
Foreign currency exposure
0-60%
TRUE WEALTH
+ 13
IT’S HARD TO BEAT THE RETURNS ON SOME INVESTMENTS.
We are a super fund. It’s our job to help build your wealth. However we believe that doing well is also about doing good. As a teacher, school or community worker, you couldn’t set a better example. So while we are proud of our track record as a high performing, low cost industry super fund, we know that’s not all you care about. You could say we’ve learnt from our 103,000 members who have dedicated their lives to helping others. We’re dedicated to educating our members and providing peace of mind. We’re invested in being responsible corporate citizens committed to helping the community and the environment. As any good superannuation fund should tell you, it’s all about giving a little to get a whole lot back. For more information visit ngssuper.com.au or call 1300 133 177.
Issued by NGS Super Pty Limited ABN 46 003 491 487 AFSL No 233 154 the Trustee of NGS Super ABN 73 549 180 515