Here’s what you need to know today

• On Friday, Australian casino giant Star Entertainment exited a trading halt and saw its share price fall 44% in a day as it negotiated a lifeline with creditors to stay afloat. Over the weekend, plenty has been written about Star’s downfall. Firstly, the AFR reported on the past two months inside Star. Then the ABC published their analysis on how the end of offshore money laundering sank Australia’s casinos.
  
  

• In one of the biggest own-goals in recent political memory, the Australian government asked Treasury to cost the idea of ending negative gearing tax concessions for property investors and then couldn’t get their story straight when it came out. Treasurer Jim Chalmers has acknowledged he asked Treasury to cost up the policy and some believe he leaked the story as well.
  
  

• America’s preferred measure of inflation, the personal-consumption index fell to an annual rate of 2.2% in August, down from 2.5% in July. While the Federal Reserve’s target is 2%, the continued downward trend has justified its decision to cut rates in September.
  
  

• It’s not just America enjoying positive news on inflation. France saw annual inflation fall to 1.2%, down from 1.8% in August. Spain reported 1.5% inflation, down from 2.3% in August. This data will encourage the European Central Bank to continue cutting rates.
  
  

• Last year we saw Bonza Airlines commence operations, only to fall into administration just 16 months later. Now we’ve got a new airline trying to enter Australia’s market, meet Koala Airlines. While not a lot is known about the upstart airline, it has its work cut out for it taking on the Qantas-Virgin duopoly.
  
  

• Speaking of airlines, Australia’s airports continue to be sought-after assets by Superannuation funds and institutional investors. Shares in both Perth Airport and Queensland Airports (operator of Gold Coast, Longreach, Mount Isa and Townsville airports) changed hands last week in deals involving Australian Super and U.S. private equity giant KKR.
  
  

• The GLP-1 drug boom continues and its not just Novo Nordisk and Eli Lily cashing in. BioAge Labs is the latest pharmaceutical company focusing on obesity drugs to go public, and shares immediately jumped 25% giving it a $700m valuation.

What the…?

One of the wildest stories in US politics unfolded over the weekend, and no, it does not involve Donald Trump. Mayor of New York City, Eric Adams, was charged by federal prosecutors on bribery charges with prosecutors alleging he has taken bribes from the country of Türkiye. Adams is now the first sitting mayor in the history of New York City to face federal criminal charges.

Investing is a lifelong journey

Here’s what you can learn today.

Question from the community: Split families - my wife took time off work for maternity leave, but is back at work, and has a lower super balance (below $500k). What options do we have to get her back on track? 

We put this question to Dylan Pargiter-Green, Director and Financial Adviser at Bold Wealth

We generally look at superannuation as a joint asset when assessing a family’s overall assets. Whilst it’s important to consider the individual balances, superannuation is an asset that you will jointly draw an income from in retirement. It only begins to matter when your balance begins to near the $1.9 Million tax free pension cap, and now the $3 Million additional tax on high balances, recently introduced.  

The $1.9 Million Cap is important because this is as much as 1 person can contribute to their account based pension (income stream from super) where earnings remain tax free. Once you exceed this cap, the earnings go back to the accumulation rate of tax at 15%. 

Both members of a household can have up to $1.9 Million in super and draw a tax free income stream – so this is $3.8 Million in total, which should provide an approximate after tax income of $250,000 for life, using relatively conservative investments. 

If you’re keen to even out the balances, and the balance of the fund is under $500,000 you can look into additional contributions using prior years unused Concessional Contributions, also known as Carry Forward contributions. This means you can use past years where you have not contributed to super and claim these in the current financial year. I’d highly recommend seeking advice if you’re going down this path though, because with careful tax planning, you can maximise the tax benefit through the use of these contributions over a number of years rather than using them all at once.

Do you want to speak to Dylan or another of our hand-picked financial advisers? Fill out the form on our website and we will put you in touch.

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