Scott Francis has published an article in today's edition of Alan Kohler's Eureka Report.  The article looks at the deeming accounts offered by banks to pensioners and how they are conning users.  Scott concludes that "pensioners would be better off having money in a cash account than in one of the banks' deeming accounts, which are geared to minimum levels."

To read the details please click here to bring up a copy of the article saved on our website.

Regards,

Scott Keefer

Scott Francis had an article published in the Courier Mail today.  The article outlined the importance of thinking about your next car purchase as it will have an impact on your future financial worth.  To read the ideas put forward by Scott please have a look at the article published on the Courier Mail's website.  Please click here.

Regards,

Scott Keefer

If you are tuned in to the movement of financial markets you will be well aware of the volatility being experienced in recent weeks.  Over the past three weeks the ASX200 has fallen just on 10%.  A lot of this fall has been attributed to problems in the sub-prime mortgage market in the USA.  Scott Francis has published an article with the Eureka Report that outlines the background to the problems in this market any flow on effects likely to be experienced in Australia.  Well worth a read. Click here.

In all the doom and gloom reporting there are a few positive glimmers especially in terms of fixed interest securities and exchange rates.  The recent raise in official interest rates will flow on to Australian fixed income securities and it appears that overseas returns may also move northward as investors move from sharemarkets into more defensive treasury bonds.  It has been reported that this movement is one of the factors leading to the fall in the Australian exchange rate over recent weeks.  This fall will have improved outcomes for those with unhedged international investments, in Australian dollar terms.

Still nothing like the 10% falls in Australia.

Regards,

Scott Keefer

Scott and I are excited to announce a new development for our website.  We are keen to deliver our commentary on the financial world using media that is accessible and user-friendly to anyone who chooses to take interest in what we have to say.  Today has seen the launch of the next stage in this process - the publication of audio podcasts on our webpage.

Every Monday we will endeavour to publish an audio 'podcast' entitled 'Monday's Money Minute' providing a 2 to 4 minute commentary on current financial issues.  The very first podcast looks at the current market volatility and the affect of the sub-prime mortgage collapse. Click here to be connected to the podcast.

If you have any suggestions on topics that could be considered for these podcasts please drop us a line at: scottk@acleardirection.com.au .

Regards,

Scott Keefer

A timely reminder was delivered this week by research house Investment Trends.  Their research found that only 7% of Australians changed their superannuation accounts this year.  Some reporting of this finding has suggested that Australians are not focused on their superannuation investments and not being proactive in trying to find the very best in superannuation fund returns.  This is even after the recent barrage of advertisements and news about he superannuation system from the government as well as the Industry Super industry.

In some ways I can understand the reasons behind this finding.  When talking to family and friends, the topic turns to the investment world with discussions about shares, property, margin and investment loans and the current media topics tending to take centre stage.  Superannuation is generally not a high priority.  I guess this is partially based on a historical perspective where superannuants found themselves in defined benefit type schemes where they basically knew what their superannuation would be worth on retirement and investment returns were not important.  As these defined benefit style schemes disappear I imagine that the focus on investment returns within super will become more acute.

I also guess that another aspect to the story is that superannuation is not seen as a direct part of the investment portfolio held by investors.  Employers pay money into a fund and you can not access the money until 55.  The younger you are, the easier it is to forget about your superannuation fund being a part of your investment story.

In a strategic planning sense, there are also good reasons not to be chopping and changing your investments and investment managers in superannuation based on the search for better returns.  Research has shown that this 'active' style approach to investing actually leads to a worse investment outcome because of transaction costs and investors 'not being in their seats' when investment markets turn.

However, there are also some very good reasons to be at least considering changing your superannuation fund.  As with all investments these factors are the fees or costs of investing and the investment approach undertaken.

APRA have recently released the 10 year returns for the industry up to 30 June 2006.  The data showed that public sector super funds have beaten the field over the past 10 years, followed by corporate and industry funds with retail funds bring up the rear.  No surprises that retail funds tend to be the higher cost funds in the field.

As you read further through our website you will find that we also believe that having an investment philosophy based on the best available academic research is also essential.

If you are not sure whether your superannuation fund has reasonable costs or is using the very best research to develop investment portfolios, I encourage you to take a look at your fund in more detail.

Regards,

Scott Keefer