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Here’s what you need to know today

• The fallout from Australia’s federal election has begun as ballots continue to be counted. More than 80% of the vote has been counted with 12 seats remaining too close to call, however, it appears Labor may end up with almost double the number of seats as the Coalition.
  
  

• Recriminations have begun on the Coalition side of politics, with former Liberal Treasurer Peter Costello and Liberal Senator Hollie Hughes criticising the economic policies taken to the election. (AFR) Meanwhile the Labor Party’s factions have started jostling for positions in Anthony Albanese’s cabinet for the next term of Parliament. (ABC News)
  
  

• Four members have emerged as candidates for Liberal Party leadership. The party’s moderates are lining up behind interim-leader Sussan Ley, while immigration spokesman Dan Tehan is also attracting some support. Meanwhile, shadow treasurer Angus Taylor and defence spokesman Andrew Hastie are seen as the two front-runners from the conservative side of the party. (Capital Brief)
  
  

• Companies have also swung into action, lobbying the re-elected Albanese government. Three of Australia’s biggest media companies - News Corp, Nine Entertainment and Seven West Media - have called on the government to commit to the News Media Bargaining Code. (AFR)
  
  

• Oil prices fell to a 4-year low after the Organisation of Petroleum Exporting Countries, or OPEC, announced huge production increases. The move is designed to punish overproducing states including Iraq and Kazakhstan but with reduced demand expected from the trade war, it is forecast to fall to as low as US$50 a barrel. (AFR)
  
  

• The Australian share market has broken its seven-day winning streak, falling 0.97% on Monday. However, the ASX 200 is now up 11% since its recent post-Liberation Day low and only down 0.5% for the year.
  
  

• China has said it would be willing to enter trade negotiations with the Trump Administration as long as the US cuts unilateral tariffs and doesn’t attempt to “coerce and blackmail”. (Quartz) Meanwhile, President Trump said in an interview on NBC’s Meet the Press, “we’re essentially not doing business with China” as he said he would not drop the 145% tariffs to bring China to the negotiating table. (NBC)
  
  

• Late last week, Reddit reported revenue jumped 61% for the first quarter to $392 million, which saw the share price jump 19% in after-hours trading. However, as company executives explained how reliant they are on Google Search for traffic, and the risk that AI may eat into that traffic, the shares fell back down and were actually down 4% by the end of the following day. (CNBC)
  
  

• Japan’s finance minister has ruled out the possibility of selling American government bonds as an negotiating tactic with America over tariffs. Japan holds more than US$1 trillion in American government debt, more than any other country. (Reuters)

What the…?

Chinese farmers have found a novel way to increase their income and cut out retailers that take most of their margin: live streaming. A number of platforms have emerged to help farmers sell their produce directly to customers at the touch of a button.

Kuaishou, a streaming app popular in rural areas, reported a 56% increase in orders with 1.4 billion orders for agricultural products in 2023. There is Xing Jianli who makes a month’s factory wages a day selling her flowers. Or Li Xiaoxia who sells fruit and has 450,000 followers. And the Huanong Brothers who stream their efforts to farm bamboo rats to their 3.6 million fan on Douyin [Chinese version of TikTok, also owned by ByteDance].

We imagine its only a matter of time before we see this combination of social media and eCommerce become more prominent in the West. (The Economist)

Investing is a lifelong journey

Here’s what you can learn today.

Life insurance: inside or outside of Super?

Community Question: What are the key differences between holding life insurance inside superannuation versus outside, and how does this impact taxation and coverage?

We put this question to Phil Thompson, financial adviser, insurance expert and founder of Skye Wealth.

Life insurance is the umbrella term for Life/Death insurance, total permanent disability insurance and income protection and they all have different tax impacts both on premiums and at claim time based on being held inside or outside of super.

Premiums & tax considerations

• Inside of super: The life insurance premiums are deductible to your super fund at the super fund tax rate (15% for most people). While most super funds pass this tax deduction back to each members account, there are some funds that don’t. 

Life Insurance (Death Cover)

• Inside Super: Premiums are tax-deductible to the super fund at 15%.

• Outside Super: Premiums are not tax-deductible, but payouts are tax-free and go directly to beneficiaries without trustee approval.

Total & Permanent Disability (TPD) Insurance

• Inside Super: Only “Any Occupation” policies are allowed, meaning a claim is only paid if the person is unable to work in any job they’re suited for. Payouts may be taxed if withdrawn before age 60.

• Outside Super: Can include “Own Occupation” TPD, which pays if the person cannot return to their specific profession—beneficial for high-skilled workers. Payouts are tax-free and don’t require trustee approval.

Income Protection Insurance

• Inside Super: Premiums are tax-deductible within the fund. However, payouts are taxed as regular income, and superannuation laws may limit policy features.

• Outside Super: Premiums are personally tax-deductible, and policies typically offer greater flexibility, such as shorter waiting periods and higher benefit amounts.

Trauma (Critical Illness) Insurance

• Inside Super: 🚫 Not typically available due to regulatory changes in 2014.

• Outside Super: Premiums are not tax-deductible, but payouts are tax-free and immediately accessible without trustee approval.

Claims & Tax Considerations

• Inside Super: If paid to a financial dependent (spouse or child under 18), the payout is tax-free. However, if the beneficiary is a non-dependent, part of the benefit may be taxed at 15% or 30%.(ATO) Claims must go through the super trustee, which can delay payments.

• Outside Super: Payouts are always tax-free and go directly to beneficiaries. Policyholders have full control over who receives the benefit, without restrictions imposed by superannuation laws.

Interested in speaking to Phil about your current levels of life insurance? Fill out the form on our website and we’ll put you in touch.

Today’s sponsor is Scouting Australia Podcast

Join Sammy Gordon, Equity Mates’ regular property expert, as he’s joined in the studio by Jimmy Ibrahim to break down the long-awaited interest rate cut and what it means for the Australian property market.

From the impact on rents and investor sentiment to whether now’s the time to buy or sell, they unpack what this shift signals and if more cuts are on the horizon.

Tune into the Scouting Australia Podcast on all your favourite platforms.

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