Financial comparison website Rate City watchdog and consumer choice has warned parents to open accounts with bonus rates for children and young people.
Members of the database shows that a third of children 57 bank accounts offer bonus interest rates, but spokeswoman Michelle Hutchison said some savings could soon be reduced away from the conditions attached. “Think about how you want your child to use the account, if it is to save up money and not using it because these high interest accounts to encourage you to maintain it very well , “Ms. Hutchison said. “But if you intend to let your child draw you may want to look at the taxation of transactions and not worry about interest rates.” The average rate for a balance of $ 500 for all accounts is 2.68 percent, but with conditional bonus rate can reach up to 8:01 per cent offered by children’s Bonus Saver BankWest. catch is, however, limited to a BankWest account depos it of $ 250 each month and the money is transferred to a lower deposit account every 12 months as a high rate can not be collected. And if your child draw any money they won 00:01 percent interest rate for the month. Cairns Penny Savings and loan offers the second highest rate of six percent higher for its first account of the Penny Saver, without any conditions, says city rates. third highest Kids by Westpac account at 5.65 per cent bonus, provided there is a deposit and no withdrawals per month. OPTIONS said parents who are looking for an account for their child should apply the same criteria that would account for their own savings, and be prepared for children to move their money, if account does not deliver. spokeswoman Ingrid Just said that some banks to transfer money into an account automatically when the child reached the age limit on the account. “If this happens, look at the circumstances and the interest rate for the new account, a nd make sure it is free,” Mrs. Only said. “Children can learn valuable lessons by having a savings account where they play an active role.”
Five changes that affect your finances
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class = “image-source”> Source: National features
Incentives for savings and superannuation budget took a beating last week, forcing investors and consultants to take a look at their strategies.
Treasurer Wayne Swan got an ax to some planned measures as he turned a large deficit in a slim profit.
Here are five key changes that affect our personal finances.
a reward for saving leftovers budget proposed 50 percent income tax deduction of interest earned up to $ 1000.
RaboDirect CEO Greg McAweeney says it is disappointing that the government broke its promise. “The 5.7 million depositors, which was set to benefit from the discount has been short-changed,” he says. Prescott Securities adviser Helen Dundon says the case for the tax break has been less important in recent years as the Aussies began to save more anyway. Farewell tax deduction
Plans for a discount of 500 standard for all employees has been canceled. It would have given money and time savings for people with basic tax returns, and was scheduled to begin on July 1 and increase in $ 1000 in July next year.
Dundon suggests IT-savvy taxpayers with basic needs to see Australian eTax SFS free service. “It’s very easy to use and what steps you through your tax return,” she says.
super slow Lane concessional super contributions cap of $ 50,000 for people aged over 50 years will be halved from 1 July a move that sparked anger from super sector. “This is a real shame,” Dundon says the delay. “Everything has already been turned on its head.”
investors should be sure that they can still make great non-concessional contributions to super – up to $ 450 000 in a three-year period – if they want to increase their nest egg quickly. Head
Mercer financial advice, Jo-Anne Bloch, said people can beat the new cap to maximize their contribution before 30 June.
hit for high income flagged a couple of weeks ago, this measure reduces the excess tax concessions to those people with high incomes – those of $ 300,000 per year or more – to accept super contributions. It is politically wise, because nobody can argue breaks were more deserving than other taxes.
Dundon says the implementation of this will be difficult. “Superannuation funds do not know that the income of people who contribute,” she says. OTHER MEASURES
Robin Hood Other cuts in the budget are forced to live away from home help, means testing for net medical expenses tax offset, and rules Strict tax on golden handshake.
Dundon says that if you’re expecting a big pay employer, try to time it so it comes in a year when you do not earn high incomes. Bloch says the winners higher incomes will be hit hard by July 1 of the Budget and other measures, including private health insurance rebate cut. “It’s just an abundance of tests of different means that people have to work their way through,” she says.
