On behalf of all of us at Avondale Wealth, we would like to wish you a very happy New Year. We look forward to catching up with each of you throughout 2026 to review your financial strategy and ensure you remain on track to reach your goals. As always, please reach out if there have been any significant changes in your circumstances that you’d like to discuss with our team.
January delivered a resilient start to 2026 for both Australian and global markets. The ASX 200 rose approximately 1.7% for the month, supported by strength in the materials sector particularly gold and copper miners, which benefited from rising commodity prices. Globally, equities posted mixed but generally positive results, with the S&P 500 gaining around 1.8%, while renewed geopolitical tensions saw investors seek safety in precious metals, pushing both gold and silver to record highs. The Australian dollar also reached a three year high, now trading around 70 US cents. However, higher than expected inflation data has increased the likelihood of a rate rise when the RBA meets next Tuesday.
We have included three articles in this month’s newsletter that we believe will interest you.
1. As discussed, the below article introduces you to Matthew Ho, the Lending Manager at Avondale Finance. We look forward to introducing him to more of you as you come through our office.
2. In this article, key events that shaped Australia’s economy and markets in 2025 are unpacked, from inflation and interest rates to property gains, global tensions, and the rise of AI, offering readers a clear snapshot of how these forces influenced investor confidence and set the stage for the economic landscape we move into in 2026.
3. This article highlights the often overlooked role of insurance in a wealth plan is unpacked, showing how thoughtful cover can preserve assets, safeguard families, and support business continuity when unpredictable events threaten long term goals.
Spotlight on Matthew Ho – Lending Manager at Avondale Finance
With over 12 years of experience in the financial planning industry, Matthew has been with Avondale Finance since August 2025 as a Lending Manager, working alongside Matthew Nott, Richard Lee, and Andrew Pike. Some of you may remember Matthew during his time working with Mark Chan during his Commonwealth Financial Planning days. Matthew holds a Diploma of Financial Planning and a Certificate IV in Finance and Mortgage Broking. With Matthew’s background in compliance, coupled with strong technical and product knowledge, clients can be assured of a solution that is bespoke to their needs.
Matthew loves to travel, having attended two FIFA World Cups, as well as all things Disney, having visited five of the six Disneylands, as well as the Disney Cruise! Matthew can often be seen at Western Sydney Wanderers games at the nearby CommBank Stadium.
Matthew can be reached via email at matthew.ho@avondalefinance.com.au or via his mobile on 0493 305 261.
2025 Year in review: It was a soft landing for Australia
Many investors breathed a sigh of relief at having survived (and even thrived) the turbulent economic and political events of 2025.
Super funds posted strong double-digit returns for the 2024-2025 financial year. Australia recorded modest economic growth, while inflation cooled a little throughout the year – albeit with a slight uptick at year’s end – and house prices surged before hitting the brakes in December. Share markets reported respectable gains locally and some surging profits globally.
The big picture
Markets and economies around the world have danced to the tune of the Trump Administration’s second term in office and reacted to wars and unrest in the Middle East and Ukraine.
The US President’s often surprising policy twists and turns, particularly a punishing new tariff regime, saw markets falter and exporters of goods and services to the US plunged into uncertainty.
The Australian dollar reflected the choppy conditions, hitting lows just under 0.60 USD in April before recovering slightly by year-end at just under 0.67 USD, this was buoyed by our strong iron ore exports and the growing demand for lithium, copper and rare earths.i
The artificial intelligence revolution was another feature of the year, driving US share markets ever higher with some fearing the bubble is overdue to burst.
Economy
Inflation’s stubborn resistance to the Reserve Bank’s measures to bring it down could lead to further interest rate rises in 2026.
The Consumer Price Index in January recorded an annual rate of 3.4 per cent, down 0.4 per cent on the previous month. The RBA’s flexible inflation target aims to keep the cost of living increases between two and three per cent.
The cash rate began 2025 at 4.35 per cent but after three cuts during the year, it was down to 3.6 per cent in December. The RBA is due to meet in February to consider its next move.
In the US, the Federal Reserve also cut rates three times, putting the interest rate to a range of 3.5 – 3.75 per cent.
The Australian economy grew 2.1 per cent in the year to September in a massive improvement on the previous year’s growth of 0.8 per cent.
Property
After two uneven years, home values surged again in 2025 by 8.6 per cent, adding about $71,500 to the national median.ii
It’s the strongest calendar year performance since the remarkable 24.5 per cent increase in 2021.
However, values softened in December, recording the smallest monthly increase in five months.
Darwin delivered the best performance with an 18.9 per cent gain in values during the year while Melbourne took the wooden spoon with a 4.8 per cent increase.iii
Share markets
Global equity markets proved that they could thrive, even in a higher-interest rate environment, and the AI revolution moved from the hype phase of the previous year to serious players in 2025.
While ‘The Magnificent Seven’ tech stocks have long ruled the S&P 500, in 2025 just two outperformed the index with a gain of 64.8 per cent for Alphabet and 38.9 per cent for Nvidia.iv
It was a slower pace for Australian markets with the S&P/ASX 200 delivering a solid total return of 6.8 per cent. While the big banks faced some pressure on margins as interest rates peaked, the materials sector was supported by the global energy transition. Dividend yields remained attractive, continuing Australia’s tradition of providing reliable income for retirees and SMSFs.
Commodities
Precious metals drove commodity values in the past year with investors looking for security amid interest rate movements and geopolitical tensions.
Silver was up by an astonishing 182 per cent during the year, but a sell-off in December saw the price finish the year with a 147 per cent gain.v
Meanwhile, gold’s safe haven status during times of uncertainty saw it jump by 65 per cent during the year.
Looking ahead
It seems likely the issues that dominated the financial markets in 2025 may continue to shape performance and returns this year.
Global politics and war are likely to move commodity prices and equity markets while the contrariness of US foreign policy will both spook and buoy investors.
In Australia, all eyes will be on the RBA, with high levels of speculation as to where interest rates will be heading in 2026.
i Australian Dollar | Trading Economics
ii Home Value Index: Softer landing after strong 2025
iii Home Value Index: Softer landing after strong 2025
iv Which Magnificent 7 Stock Had the Best Year in 2025? | Investing.com
The silent partner in your wealth plan
When you think about building wealth, you may picture investments, property and superannuation. But there’s another critical element: insurance. It’s the silent partner in your financial strategy, quietly working behind the scenes to protect everything you’ve built.
Strategic asset allocation is the hallmark of a robust wealth plan, using diverse holdings to build long-term financial success.
Yet, defending a portfolio against unforeseen events and ensuring a smooth estate transfer is just as vital. That’s where targeted insurance solutions come in.
Far from being just a safety net, insurance can be a tool that preserves your assets and keeps your plans on track even when life delivers the unexpected.
Insurance can help to create a more resilient wealth plan, especially for those with complex estate considerations. In other words, the right cover can make all the difference between maintaining your lifestyle and facing financial hardship.
Safeguarding your family
Life is unpredictable. Illness, injury or premature death can derail even the most carefully designed financial plan.
The risk is magnified if wealth is concentrated in illiquid assets such as private business interests or large property holdings. Beneficiaries often need immediate access to cash to cover any outstanding debts, taxes that may be owing, and to manage business continuity. If funds are not available, the executor may be forced to sell the core portfolio, or business assets quickly, and potentially at a loss.
That’s where life insurance, Total and Permanent Disability (TPD) cover and trauma insurance can play an important role as a structural defence mechanism for a portfolio and an estate.
Life insurance provides a lump sum to beneficiaries after your death, allowing them to secure their future. TPD cover steps in if you suffer a permanent disability and are unable work again, providing the funds for medical care and living expenses. Trauma insurance covers serious illness such as cancer or heart disease, giving you financial breathing room during recovery.
Income protection insurance is another valuable way of providing income if illness or injury stops you from working. It pays up to 75 per cent of your income and helps you to avoid dipping into your savings or selling assets at the wrong time.i
These policies can mean peace of mind for families, helping to protect assets and ensuring that wealth transfers happen as you intended.
Protecting your business
Insurance is also a cornerstone of small business risk management strategy.
Assessing and managing risks may highlight the need for a range of insurances such as flood and fire, theft, public liability, professional indemnity and cyber liability. These covers can help to defend your business against the crippling expenses that may follow unexpected events.
Risks can also be personal.
Business partners can use life insurance policies to safeguard their interests in case one business partner dies, providing the funds to buy the partner’s share of the business from their estate. Without a policy, the surviving partner may struggle to buy out the deceased’s share, forcing a quick sale of the business at a discount. With the right cover, the transition can be smoother, preserving value for the families involved.
Meanwhile, key person cover helps to protect against the financial impact of losing a vital team member to illness or if they die. In the event of a claim, the business will receive the insurance benefit.
Car, home and contents
If your car was stolen or damaged, will your insurance cover its replacement? If your home was completely destroyed tomorrow, do you have adequate insurance to rebuild as well as buy new furniture and fittings? These are things you need to consider when taking out insurance.
Reviewing your cover
Life changes and so should your insurance. Too little cover in any area of your life could leave you exposed, too much could mean unnecessary premiums.
Regular reviews can ensure your various insurances fit with your goals and current circumstances. It’s about having the right cover at the right time.
Insurance doesn’t generate returns, but it protects the foundation of everything you’ve built. Without it, one unexpected event could unravel years of planning.
A few smart decisions now can make all the difference when life doesn’t go according to plan.
Please call us to talk about how your current cover fits with your financial strategy.
