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May was a significant month for Australia’s economy. The re-election of the Labor government brought with it election promises of student debt reductions, cost-of-living support, and expanded programs to assist first home buyers. With inflation falling back to target levels, the RBA decided to cut the cash rate by 0.25% to 3.85%. On average, a $500,000 mortgage will see a $76 reduction in monthly repayments.
If you are a mortgage holder, and would like a complimentary review of your loan, comparing your current interest rates to up to 40 lenders, reach out to our lending specialists at Avondale Finance who will be happy to guide you through your options. Matthew Nott can be contacted either on email matthew.nott@avondalefinance.com.au or his mobile phone 0414 775 773.
With the end-of-financial-year fast approaching, there may be an opportunity for you to contribute additional funds into your superannuation. An end-of-financial-year concessional contribution could boost your retirement savings, while potentially reducing your taxable income in the 2024-25 financial year. As the cut-off date where superannuation providers will receive and process super contributions is getting closer, we encourage clients to make contributions by 10 June 2025. Please feel free to reach out to us if this is something we can assist with.
Avondale Wealth has made cybersecurity a central focus in response to the increasing frequency and sophistication of scams targeting the financial services industry. Over the past year, we have implemented several key measures to protect our client data.
Secure Communication Channels: Sensitive information is no longer shared via email. Instead, Avondale Wealth uses secure methods such as setting up a dedicated client portal (via MyProsperity) to share information.
Our client portal is a cornerstone of Avondale Wealth’s cybersecurity strategy. It offers:
• 256-bit Bank-Level Encryption: The same encryption standard used by major banks like CBA
• Document Management: Clients can securely receive, sign, and return documents.
• Financial Overview: A comprehensive dashboard showing assets, liabilities, and financial position.
• Mobile Access: Clients can download the MyProsperity app for convenient access on the go
Many of you have already activated our client portal during your annual reviews with Mark or Chris. If you haven’t done so yet, feel free to reach out, and we will happily assist you with setting up access.
Please see below three articles that may interest you.
1. With financial scams continuing to become more sophisticated, and Australians losing $3.18 Billion to scams last year, the below article highlights different scams affecting Australians right now, and how to protect yourself from them. As mentioned above, Avondale Wealth takes numerous steps to ensure your information is safe with us.
2. As Superannuation laws continue to change, the below article discusses the increase in the superannuation guarantee to 12%, a higher transfer balance cap, and the proposal for higher taxes for individuals with super balances over $3 million.
3. As housing affordability continues to be a challenge, many parents are stepping in to provide financial support to their adult children. The below article explores the different ways parents can assist—whether through gifting funds, acting as guarantors, or co-owning property—while emphasizing the importance of maintaining financial stability and planning for retirement.
Scams: knowledge is protection
Scammers operate in an ever-evolving space and the scams of today are far more sophisticated than they have ever been, targeting even the most financially literate individuals.
In addition to the financial impact from a scam, it can affect your mental health as well as damage your reputation, so understanding how scammers operate is the best way protect yourself from falling victim.
A growing trend
The statistics provide a sobering reminder that no one is immune—no matter how experienced or cautious they may be – it can happen at the click of a button.
According to the Australian Competition and Consumer Commission’s (ACCC) Scamwatch, Australians lost an alarming $3.18 billion to scams last year.
The average individual loss from scams is significant, with individual losses rising by more than 50 per cent last year, to an average of almost $20,000.i This is due, in part, to scammers using new technology to lure and deceive victims and it underscores the serious financial toll scams can take.
Some of the most common scams include:
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Investment scams: Investment scams continue to be a major issue, with losses reaching around $1.2 billion in 2024. These scams often involve fraudulent online trading platforms or fake cryptocurrency schemes, designed to lure investors with promises of high returns and minimal risk.
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Impersonation scams: Fraudsters are increasingly using sophisticated tactics to impersonate trusted organisations, such as government bodies, banks, and financial advisers. In 2024, impersonation scams accounted for $700 million in losses, with scammers using fake emails, phone calls, and even text messages to trick victims into revealing sensitive personal information or parting with funds.
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Romance and relationship scams: These scams often involve scammers establishing a personal relationship with victims before manipulating them into sending money. In 2024, these types of scams led to losses of $250 million, highlighting the emotional and financial damage they can cause.
While these figures are shocking, they also reflect the changing nature of scams. Scammers are no longer relying on clumsy, obvious frauds. Instead, they are using highly professional methods, often tailored to the specific interests, financial knowledge, and behaviours of their targets.
Why everyone is vulnerable
As scammers become more creative, even the most experienced and financially literate individuals are at risk. There are several reasons why this is the case.
Sophistication: Scammers now use advanced technology and psychological manipulation to trick their victims. They impersonate respected brands and financial institutions, and they can craft highly convincing emails, websites, and phone calls that look indistinguishable from legitimate communications.
Cryptocurrency and new technologies: The rise of digital currencies and decentralised finance (DeFi) platforms has created new opportunities for scammers to exploit. These markets are largely unregulated, making them more vulnerable to exploitation by criminals.
Deepfakes: Scammers are increasingly using deepfake technology to make their fraudulent schemes more convincing and harder to detect. By creating hyper-realistic videos or audio recordings, they can impersonate trusted individuals, such as company executives, colleagues, or even loved ones, to manipulate victims to respond to requests for urgent assistance or money. This manipulation of digital media makes it much more difficult for victims to distinguish between what’s real and what’s fabricated.
Protecting yourself
Despite the growing sophistication of scammers, there are steps you can take to protect yourself. It’s crucial to stay alert and use a combination of scepticism, knowledge, and due diligence.
Be cautious when receiving unsolicited offers or requests, whether by phone, email, or social media. If you weren’t expecting to hear from a company or individual, don’t rush to react. Don’t click on links. Take a step back and verify the legitimacy of the contact by using an email or contact number that you locate online. Always verify account details this way before transferring any money.
Scammers are constantly evolving their tactics, so it’s crucial to stay informed. Regularly educate yourself on the latest scam trends and familiarize yourself with common warning signs. Agencies like Scamwatch provide ongoing updates and resources for identifying and reporting scams.
The evolving nature of financial scams means that it’s not enough to simply be cautious; you need to stay proactive. If you’re unsure whether an opportunity is a scam or simply want a second opinion on a financial matter, we’re here to help.
Source for all scam statistics in this article: https://www.scamwatch.gov.au/research-and-resources/scam-statistics
i https://www.scamwatch.gov.au/research-and-resources/scam-statistics
The superannuation changes from 1 July
The super changes coming into effect in the 2025-26 financial year
Australian superannuation laws changed once again in the 2025-26 financial year as the nation’s fast-growing retirement savings system continues to evolve.
Below is a summary of the changes that came into effect on 1 July 2025, as well as looming legislative changes.
Increased super guarantee (SG)
Millions of working Australians will receive a welcome superannuation boost from the start of July with the mandatory superannuation guarantee (SG) rate rising by 0.5% to 12%.
The SG is the percentage of your ordinary time earnings (in addition to wages) that is paid into your super fund account by your employer.
The 2025-26 rise marks the end of a series of five 0.5% SG rate increases since the start of the 2021-22 financial year, when the SG rate was lifted from 9.5% to 10%.
Higher transfer balance cap
Individuals starting a pension for the first time on or after 1 July 2025 will be entitled to a personal transfer balance cap (TBC) of $2 million, which increased by $100,000 from the current level of $1.9 million.
The TBC is the maximum amount that an individual can transfer from their superannuation accumulation account into a tax-free pension account on their retirement. Any amount over the TBC must be retained in an accumulation account, where any contributions and investment earnings are still taxed at 15%.
Keep in mind that investment earnings within the pension account can increase the account balance above the $2 million transfer balance cap without any penalty.
Carry-forward concessional contributions
Eligible workers can “carry forward” any of their unused annual concessional super contribution cap amounts from up to five financial years ago and add them to their concessional contribution cap in the current financial year.
That means it may be possible to contribute more than the current $30,000 concessionally taxed limit, subject to you having a total super balance of less than $500,000 at 30 June of the previous financial year and you having unused concessional contributions cap amounts available.
From 1 July the starting financial year for carry forward amounts will roll over to 2020-21. As such, the deadline for taking advantage of any unused entitlements you may have from the 2019-20 financial year ended on 30 June.
Proposed higher taxes on $3 million-plus super balances
Following its recent re-election, the federal government is likely to reintroduce its Division 296 tax bill to be passed as legislation.
The proposed Division 296 legislation would introduce an additional 15% tax on the earnings of super funds with balances above $3 million (which would apply to earnings on any amounts over $3 million). This would include any unrealised gains on assets held inside a super fund, such as shares and property, even if they had not been sold.
Source: Vanguard
This article has been reprinted with the permission of Vanguard Investments Australia Ltd. Copyright Smart Investing™
Important information and general advice warning
Vanguard Super Pty Ltd (ABN 73 643 614 386 / AFS Licence 526270) (the Trustee) is the trustee of Vanguard Super (ABN 27923449966) and the issuer of Vanguard Super products. The Trustee has contracted Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263) (VIA) to provide some services to members of Vanguard Super. Any general advice is provided by VIA. The Trustee and VIA are both wholly owned subsidiaries of The Vanguard Group, Inc. (collectively, “Vanguard”). The retirement savings tips provided above are general in nature and don’t take into account your personal financial objectives, situation or needs. You should consider your objectives, financial situation or needs, and the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any decision about Vanguard Super. The PDS and TMD can also be accessed free of charge by calling 1300 655 101. Before you make any financial decision regarding Vanguard Super, you may wish to seek professional advice from a suitably qualified adviser. Any past performance information is given for illustrative purposes only and should not be relied upon as, and is not, an indication of future performance. The information above is current as at time of publication and was prepared in good faith and we accept no liability for any errors or omissions.
©2025 Vanguard Investments Australia Ltd. All rights reserved.
Helping the kids without derailing your retirement plans
As parents, the instinct to support our children never truly fades, even when they become adults but when you are looking at giving them a financial helping hand there is a bit to consider.
It’s important to ensure any support you provide is not at the expense of your financial future. It can also be tricky knowing what form your support should take, in order to maximise the benefits for your kids.
Support in a challenging environment
In today’s financial landscape, many young people are struggling to get ahead in the face of skyrocketing housing prices and rising living costs and it’s increasingly common for parents to provide some form of financial assistance. In fact, more than half of parents with a child older than 18 provide financial support.i
So, if you are giving your adult kids a monetary helping hand, or considering it, you are in good company.
Achieving balance
The challenge for most people is the balance between helping your kids get a head start in life and making sure you have enough for a secure financial future.
It’s important to have clear visibility of your own financial situation, of how much you’ll need to fund the retirement you aspire to, and how much you can comfortably spare. If your financial future is secure, you’ll be in a better position to help your children when they need it most, so ensure that any contribution you make to your kids’ financial wellbeing is not at the expense of your superannuation and other retirement savings.
Ways of providing support
When we think of support we often think of the ‘bank of mum and dad’ helping with a home purchase and that is quite common, with 40 per cent of new home buyers getting a hand from their parents. ii
If you’re considering this route, you have several options:
Gift funds: If you have the means, you can gift your child a portion of the deposit, however, be mindful of any tax implications.
Going guarantor: Another popular option is to act as a guarantor on your child’s home loan. This means that you’ll use the equity in your own home to guarantee the loan, which can help your child secure better borrowing terms. It’s a significant commitment, so be sure to discuss the potential risks and implications thoroughly.
Co-ownership: In some cases, parents and children can purchase a property together, sharing the financial responsibilities. This arrangement can be beneficial, but it’s crucial to have a clear agreement in place outlining each party’s responsibilities and financial contributions.
Other ways of providing financial support
There are lot of other ways you can help your kids with a range of expenses. Nearly 40 per cent of parents pay for their adult children’s groceries and around the same proportion allow their adult children to live at home rent-free, while around a third pay their adult children’s bills. One in five fork out for their kid’s car-related costs like registration fees and petrol and 20 per cent pay for their kids to take off on holidays.iii
Non-financial support
Financial assistance isn’t the only way to support your children. Often, your time and knowledge can be just as valuable. Encourage them to develop good financial habits, such as budgeting, saving, and investing. You might even consider involving them in family discussions about money management, which can empower them to make informed financial decisions.
Communication is critical
Regular, honest conversations about finances can strengthen your relationship with your children. Discuss their financial goals and challenges openly and encourage them to share their aspirations. These dialogues will allow you to gauge how best to support them and sometimes, just being there to listen can make a world of difference.
Setting clear boundaries is also crucial when offering financial support. Discuss how much you can provide, whether it’s a one-off gift, a monthly allowance, or a loan. By being transparent about your limits, you can prevent misunderstandings and help your children set realistic expectations and become financially independent.
Navigating the complexities of financial support can be challenging, especially when balancing your own needs with those of your children. We can provide assistance and advice tailored to your unique situation and help you create a sustainable plan that allows you to assist your children without compromising your retirement goals.
i Finder Bank of Mum and Dad Report | Finder
ii https://www.apimagazine.com.au/news/tag/deposit
iii Bank of Mum and Dad slightly less generous than before COVID-19 crisis, survey shows | Domain
