+61 409 284 812

Rarebreed Finance Pty Ltd [ACN: 619 779 369] is a Corporate Authorised Credit Representative of Vow Financial Pty Ltd [ACN: 138 789 161], Australian Credit Licence 390261

©2019 by Rarebreed Financial. Proudly created with Wix.com

FutureNOW Calculator Assumptions and Disclaimer

Assumptions and Disclaimers

 

Copyright © 2016 Rarebreed Technologies Pty Ltd

 

All rights reserved. No part of this financial tool may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the owner, except in the case where results/projections of the financial tool are embodied within Financial Statements of Advice and certain other commercial uses permitted by copyright law and/or the consent of the owner. For permission requests, write to the owner, at the address below:

 

Managing Director

Rarebreed Technologies Pty Ltd

PO Box 140

SUBIACO WA 6904

 

There are a number of assumptions which the calculation is based on and they include:

 

  1. One year is assumed to contain exactly 52 weeks or 26 fortnights. This implicitly assumes that a year has 364 days rather than the actual 365 or 366.

  2. All months are assumed to be of equal length. In reality, many loans accrue on a daily basis leading to a varying number of days' interest dependent on the number of days in the particular month.

  3. Deposits to Offset account are assumed to be paid to Offset at the end of the fortnight or month depending on the "Offset Account Regular Deposit Interval" selected. This is independent of the home loan repayment interval. If a deposit was paid to Offset in between home loan repayment cycle, the interest savings were calculated based on the days till the next home loan repayment

  4. The calculations exclude any Bank Fees and Charges debited to the Loan(s).

 

Tools and Calculator Disclaimer

These calculators are designed to be informational and educational tools only, and when used alone, do not constitute investment advice. We strongly recommend that you seek the advice of a financial services professional before making any type of investment. We also encourage you to review your investment strategy periodically as your financial circumstances change.

 

This model is provided as a rough approximation of future financial performance. The results presented by this calculator are hypothetical and based on certain assumptions. They may not reflect the actual growth of your own investments or performance of loans. Rarebreed and its affiliates are not responsible for the consequences of any decisions or actions taken in reliance upon or as a result of the information provided by these tools. Rarebreed Technologies Pty Ltd are not responsible for any human or mechanical errors or omissions.

 

We’ve put together these calculators to give you some examples of different financial scenarios, based on stated assumptions and the figures you input. The calculations are intended as estimates only and they’re not meant to be used for any practical purpose, or as a substitute for professional financial advice.

 

While we’ve based the information on sources that we believe are reliable and accurate, your actual outcomes will depend on a range of factors outside of our control. You shouldn’t rely on this calculator when you’re making decisions about a financial product, fund or strategy. Instead, you should consider getting advice from a qualified financial adviser.

 

The owners expressly disclaim all liability and responsibility to any person who relies, or partially relies, on anything done or omitted to be done by this calculator.

 

Assumptions and limitations for the Calculator

 

Disclaimer

The calculator results are simulated and not a prediction. Consider updating the projections provided by this model if circumstances have changed.

Default Assumptions

 

The projections generated in the calculator are based on the following assumptions.

‘Cascade’ Personal Debt Reduction Strategies

 

The calculator defaults to the ‘Avalanche – Highest interest First’ method.

In Adviser_Inputs_Assumptions Tab of the calculator you can vary this strategy to the ‘Snowball – Lowest balance First’ or to ascending or descending orders or to a customised ranking.

Superannuation Assumptions.

Superannuation

 

The Superannuation Modelling is for accumulation funds only. The calculator works for accumulation funds only. It will not work for defined benefit funds.

 

We assume your account balance will receive all income and outgoings quarterly.

 

The projected figures generated by this calculator aren’t guaranteed, are provided as an illustration only, and may vary from actual results. The calculator isn’t intended to be and shouldn’t be relied on when making a decision about a particular financial product. Before making any financial decisions you should consider getting some personal financial advice from an Australian Financial Service licensee.

 

The purpose of the Retirement Income Calculator is to let you test, or model, how your choices may affect your super over the long term. Factors such as investment earnings, salary inflation and contributions are assumed to grow in a steady, predictable fashion as described in these notes. So these figures are indicative only, and changes to any one of the assumptions may have a significant effect on your projected outcomes.

 

All months are assumed to be of equal length. In reality, many loans accrue on a daily basis leading to a varying number of days' interest dependent on the number of days in the particular month. This is independent of the home loan repayment interval. If a deposit was paid to Offset in between home loan repayment cycle, the interest savings were calculated based on the days till the next home loan repayment.

 

Actual outcomes will vary depending on a range of factors, including actual contributions, salary increases, investment returns, insurance premiums, fees, tax and external factors like inflation and future legislative changes. For this reason, we recommend you regularly re-visit your super arrangements. If you want to know more about the way your estimate has been calculated, or the assumptions used, please contact us. And please note, the projected figures are based on current tax and legislation remaining unchanged.

 

The results from this calculator are based on the information provided and assumptions made about the future. The amounts projected are estimates only and are not guaranteed. This calculator cannot predict the final superannuation benefit or level of retirement income with certainty because this will depend on personal circumstances and market variables.

 

This calculator assumes that all assumptions remain steady and predictable over time. These assumptions are essential so the calculator can show the effect of things you may be able to control, such as choosing a different investment option.

 

Inflation

Results are in today's dollars - Adjusted for Inflation Results are shown in today's dollars, which means they are adjusted for inflation.  

We make the following default assumptions about inflation (which can be changed under the Adviser_Inputs_Assumptions Tab of the calculator):

  • 2.0% each year due to the rising cost of living (CPI inflation)

  • A further 1.2% each year due to the cost of rising community living standards

 

Contributions

In future years we assume that:

  • Your employer and voluntary contributions will increase with inflation

  • You will satisfy the Work test at older ages and so are able to contribute

  • The employer contribution rate will increase by 0.5% per annum from 1 July 2021 until SG rate reaches and stays at 12% from 1 July 2025 onwards.

 

Before tax (salary sacrifice) contributions (CC)

We adjust these contributions so you don't exceed the concessional contributions cap (which applies to the total of your employer and before tax contributions)

At 1 July 2017, the concessional contribution cap is reset to $25,000 for all individuals.

We assume that the concessional contribution cap will increase in future years with inflation After tax contributions (NCC) The non-concessional contribution cap is set at $100,000 as at 1 July, 2017.

We assume that the concessional contribution cap will increase in future years with inflation

Transfer Balance Cap

From 1 July 2017 there is a cap on the amount of superannuation eligible to be transferred to account based pensions in retirement. This Transfer Balance Cap of $1,600,000 at 1 July 2017 is indexed with inflation over time.

The calculator allows for balances in excess of the Transfer Balance Cap retained in the Super Accumulation Fund post-pension phase.

 

Drawdowns in Retirement (Pension Phase)

It is assumed you have retired on or after the relevant preservation age.

If you have debt still remaining on your Home Loan at Retirement Age this is assumed to be paid out from your Super balance at retirement. This can be amended and not paid out (house sold) under Adviser Inputs_Customised.

The calculator determines the drawdowns from your account based pension based on the stated desired retirement income (indexed for inflation over time).

Where drawdowns from the Pension fund and/or Age Pension is below the desired retirement income inputted and there is a balance in the Super Accumulation Fund these funds are used to top-up the drawdown to the desired amount. Only your retirement income from your account-based pension and any eligible income from the government age pension is included in projected results.

Income from any other investments is not included.

The calculator applies the minimum drawdown rules annually to your drawdowns from your account based pension each year which may result in a higher income being paid to you in some years. Where the minimum drawdown exceeds your indexed desired retirement income any balance is reinvested back into the Super Accumulation Fund post-pension phase.

We adjust these contributions so you don't exceed the annual non-concessional contributions cap.

We do not allow for a higher cap that can apply over three consecutive tax years in some circumstances because it is projecting regular contributions you will make each year.

We assume that your employer contributes an amount equal to that gazetted by Government rules and legislation, applied to your ordinary time earnings (you can change this in Adviser_Inputs_Assumptions Tab of the calculator).

Investment options and returns

The Calculator defaults Superannuation performance, fees and tax to each Client having a 'BALANCED' Investment Option (Risk Profile)

Provisions are available under the Tab - Adviser Inputs_Customised to vary these default assumptions

 

 

 

 

 

 

 

 

 

 

 

* These assumed default investment returns and tax rates are based on actuarial advice received in June 2018 - refer ASIC Moneysmart website

 

Tax

We assume that you have provided your Tax File Number to your superannuation fund. No allowance is made for any other tax. In particular, if you receive a benefit amount before age 60 no allowance is made for any income tax payable.

 

Administration fees

We assume the dollar per annum administration fees are charged mid-year on average and will increase with inflation each year and that the administration fees charged as a % of your balance are charged quarterly on average.

We assume that these fees are tax deductible within super.

Investment fees

These fees represent costs relating to the management of your investments and are directly deducted from your account.

We assume that the investment fees charged as a % of your balance are charged quarterly on average.

 

We assume that these fees are tax deductible within super.

Indirect cost ratio / indirect costs

These costs represent costs that are deducted from investment returns before returns are credited to your account.

We assume that the indirect costs are charged as a % of your balance are charged quarterly on average.

We assume that these fees are tax deductible within super and that tax deductions are credited before deducting these fees from the returns that are applied to your account.

Insurance Premiums paid from Super

The calculator defaults to NO insurance premiums are being paid from Super.

In Adviser_Inputs_Assumptions Tab of the calculator you can enter any personal insurance premiums paid from Super that are charged.

We assume the same amount (in today's dollars and index for inflation) will be deducted in future years until retirement.

Adviser service fees

The calculator defaults to NO Adviser Service Fees are being paid from Super.

In Adviser_Inputs_Assumptions Tab of the calculator you can enter the adviser service fees that are charged.

We assume that these fees are tax deductible within super.

We assume the dollar per annum insurance premiums are charged quarterly on average and will increase with inflation each year and that the adviser fees charged as a % of your balance are charged quarterly on average.

There is a lot to consider when comparing investment options between funds. Risk and return objectives and asset allocation within investment options may differ between funds and should be taken into account when comparing funds.

Investment returns

Actual returns will vary significantly from year to year and could be negative in some years, particularly for investment mixes where more is invested in shares and property. This calculator does not allow for such variations.

You can vary assumptions in Adviser_Inputs_Assumptions Tab of the calculator.

15% Tax is deducted from your employer contributions and before tax (salary sacrifice) contributions.

We use the earnings tax assumptions above to allow for the tax on the investment earnings of your superannuation fund prior to retirement.

We assume the dollar per annum administration fees are charged mid-year on average and will increase with inflation each year and that the administration fees charged as a % of your balance are charged quarterly on average.

We assume that these fees are tax deductible within super and that tax deductions are credited before deducting these fees from the returns that are applied to your account.