Tech Talk
Ever wondered how financial planners plan for their own future ?
Smart Practice
Tech Talk
Antony Scholefield
How Google searches might help track cancer
What ’ s my strategy ?
FINANCE
IN a meeting last week , a client asked me if I was doing what I recommended she do . This is a fair question . If you coach , you need to play , I think . In the investment advice space if you are recommending your clients do something different to what you are doing , you have a problem . So I answered her question — with perhaps more detail than she wanted .
We have nearly 400 financial planners around Australia and I am responsible for their advice , making sure it is in their client ’ s best interests and appropriate .
This means I am personally responsible for more than 6000 formal statements of advice a year . I have developed views and strategies for my clients not usually found in a text book or a ‘ get rich quick ’ handbook . It ’ s about a smart choice of investment vehicle , tax efficiency , simple direct investments and letting time do its work , over the decades .
Like most of us , I am concerned about the future . The world is changing , and for the first time in 100 years , the next generation will , collectively , find it harder going than their parents did .
The average Sydney home price is nearly $ 1 million and Melbourne is not far behind . A helpful partner and helpful parents are needed to get onto the first-home owner track . How does a single young person own a home on Sydney ’ s north shore , or Melbourne ’ s bayside belt ? The answer is they probably can ’ t , at least without significant parental assistance .
Society is polarising on intergenerational , home-ownership lines . It will be a fully employed , home-owning minority versus everyone else .
I am also concerned about investment risk and low real rates of return .
Interest rates will remain low for many years yet . Inflation will too . This means everyone with money in the bank is losing every year : high taxes and inflation combine to destroy purchasing power . You have to be exposed to growth assets — shares and property . It ’ s too risky not to be .
Economic theory and economic history tell us
Ever wondered how financial planners plan for their own future ?
TERRY McMASTER
that over time , shares and property work well as investments . The longer the time frame , the more likely this is . If you do not invest in property and shares and live longer than expected , you will probably end up poor .
You have got to make it on your own . You cannot rely on the government . An old age pension ; a state-funded , indexed minimum income from retirement to grave , won ’ t be there . By 2030 , Australia cannot afford old age pensions .
Sounds bleak , doesn ’ t it . Almost like Trump ’ s inauguration speech . Well , the good news is some simple , commonsense strategies mean you can beat the system and get ahead . But there is no
THE GOOD NEWS IS SOME SIMPLE , COMMONSENSE STRATEGIES MEAN YOU CAN BEAT THE SYSTEM AND GET AHEAD .
quick fix and it does take time . Decades actually . So , what am I doing ? What does my financial plan look like ?
I invest in myself . I fear technical redundancy , and I know the best investment is my formal and informal education , with an emphasis on future skills and adaptability .
I exercise every day ( actually , I over-exercise every day ), eat well , sleep well ( perhaps too well ), avoid stress and minimise lifestyle risks to maximise my health . Health is , of course , your most valuable asset . You cannot do anything without it .
I do not have life insurance . I have sufficient assets , my wife earns a good salary as a senior teacher , my adult children no longer depend on me , and we have relatively low debt .
I transfer $ 25,000 a year , in 12 lots of $ 2083 , to our self-managed super fund . These monies are invested in Australian index funds . This is simple , low-cost and tax-efficient .
My wife and I have a few residential properties . We followed McMasters ’ mantra — “ never sell a good property . Over the past 20 years , Australian property has averaged 10.5 % a year . We lucked out . But we also went flat out to pay property off . This means we have no non-deductible debt . It ’ s too expensive .
Excess cash flow from work , business and investing is channelled to a private investment company ( taxed at 27.5 %, with no Medicare levy ) and invested in Australian blue chip shares , an index fund and a geared index fund . We run a low-cost share-buying account and do it ourselves . No middle man . We do not own the private investment company ourselves . It ’ s owned by a special purpose family trust .
The idea is one day , the private company will pay a fully franked dividend to the family trust . It will then be distributed to family members who pay tax at less than the company tax rate ( 27.5 %). This means all or some of the tax paid now by the company will be refunded to family members down the track . It ’ s tax-efficient . It could even be more taxefficient than a super fund .
My wife and I are helping our adult children buy their own homes faster than otherwise . We intend to leave a lot to them and their children . To understand why , re-read the early paragraphs of this essay . The future is not like the past . ●
Mr McMaster is a solicitor and accountant , practising in Melbourne . The advice is general in nature and readers should seek advice before making financial decisions .
This is an edited extract of an article by Mr McMaster . For the full article , see : bit . ly / 2uAylN0
AS GPs know only too well , patients will often take to Google to learn about their conditions , which can lead one down a web wormhole and into the arms of all sorts of quackery .
However , there may be an upside to these searches . US researchers have found some evidence that Google searches can be used to track the incidence rate of non-infectious diseases — specifically cancer .
Using Google searches to track disease incidence isn ’ t a new idea .
A famous study published in Nature in 2008 concluded that Google searches for flu symptoms were a useful tool for tracking flu outbreaks .
Google went on to release Google Flu Trends , a publicly visible program to do just that . It had some hits and some misses — most notably missing the 2009 swine flu pandemic . And it was taken offline in 2015 .
Cancers are obviously quite different to influenza . But the researchers from the universities of Pennsylvania and California say using Google searches could be an important way to track and compare the relative incidence and mortality of cancers that don ’ t have formal registers .
For example , in the US , there are no national data available on basal and squamous cell carcinomas .
The researchers also claim that Google searches offer a more realtime way of assessing diagnosis rates .
Their study found that , state-bystate , relative Google search volume correlated with official incidence rates for colon , lung and thyroid cancer , as well as lymphoma and melanoma . The search volume also correlated with figures for mortality rates in all the above cancers , apart from thyroid .
However , the searches did not correlate for breast , prostate and bladder cancers .
These results may have been impacted by public health campaigns that saw people without the diseases carrying out Google searches after being prompted by the campaigns , the authors say .
Yet , they remain optimistic that Google data for some diseases could still be useful .
“ Population-level disease metrics are critically important to guide distribution of resources and design of public health initiatives .
“ Internet search data may provide useful estimates of disease , such as incidence , particularly where registry data are insufficient , lagging , or lacking ,” they conclude .
This is all hypothetical right now . And given that Google ’ s flu trends failed to transform infectious disease tracking , it ’ s hard to envision that this will revolutionise cancer tracking .
However , it does show there ’ s more to Google health searches than the risk of misinformation . JAMA Dermatology 2017 ; online .
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