Would you claim the Lego you bought for your kids throughout the year as a tax deduction? One taxpayer did and it made the Australian Taxation Office’s 2018-19 list of most unusual claims.
New pay rates came into effect from 1 July 2019 with the minimum wage increasing by 3% from the first full pay period. The new national minimum wage is now $740.80 per week or $19.49 per hour. The national minimum wage applies to employees who aren’t covered by an award or agreement.
Women and girls make up just over half (50.7%) of the Australian population. While women comprise roughly 47% of all employees in Australia, they take home on average $251.20 less than men each week (full-time adult ordinary earnings). The national gender “pay gap” is 15.3% and it has remained stuck between 15% and 19% for the past two decades.
In 2017, Australia was ranked 35th on a global index measuring gender equality, slipping from a high point of 15th in 2006. While Australia scores very highly in the area of educational attainment, there is still a lot of progress to be made in the areas of economic participation and opportunity and political empowerment.
So, what are we missing? Why do we have so many highly educated women but still have a pay gap and unequal representation in senior management? The number of women on the Boards of ASX-listed companies grew from 8.3% in 2009 to 26.2% in 2017 but while very positive, this percentage is hardly representative of the broader population.
McKinsey & Co’s recent Women in the Workplace 2018 study tracks a similar dilemma in the US. The study states:
“The two biggest drivers of representation are hiring and promotions, and companies are disadvantaging women in these areas from the beginning. Although women earn more bachelor’s degrees than men, and have for decades, they are less likely to be hired into entry-level jobs. At the first critical step up to manager, the disparity widens further. Women are less likely to be hired into manager-level jobs, and they are far less likely to be promoted into them—for every 100 men promoted to manager, 79 women are. Largely because of these gender gaps, men end up holding 62 percent of manager positions, while women hold only 38 percent.”
While it is convenient to point to the amount of work women do in the home and maternity leave as the reason for why women do not progress, it is not enough to justify the statistics: Australian women account for 68% of primary carers for older people and people with disability and 95% of primary parental leave (outside of the public-sector) is taken by women and women spend almost three times as much time taking care of children each day, compared to men.
Source: Australian Human Rights Commission. International Women’s Day is on Friday, 8 March.
Life does not always go to plan. While we logically know that, most of us don’t plan for the worst - it’s all a bit morbid and time consuming.
The downside of not planning is the potential for hard earned assets to be squandered, family fall-outs, and money handed to the Government that could have been distributed in accord with your wishes. If you are a business owner, then the stakes are even higher.
As a population, planning is more important than ever because:
• The ageing demographic – 1 in 7 of us are now aged 65 and over (3.8 million)
• The baby boomer generation represent only 25% of the population but hold 55% of the wealth
• We are entering a period of intergenerational wealth transfer from the baby boomer generation
• Over the last 25 years there has been an explosion of wealth in Australia
Estate planning is simply identifying your assets and liabilities and what you want to happen to those assets if something happens to you. As part of that, you need to look at the issues that might arise and how best to manage them. All of this is then reviewed for tax outcomes and the legal requirements to provide the best care and protection for your beneficiaries.
If you are a business owner, there are also another set of issues to consider to ensure that the business can continue if you are not able to continue in your current role. Or, your beneficiaries can take their share of the value accumulated in the business. This planning will protect your beneficiaries, the business, and your business partners.
Estate planning does not have to be hard work, but it does have to be planned.
It’s also important to understand that actual wealth or the size of your estate is not the sole reason for estate planning. Estate planning is important for:
• The care and maintenance of minor children.
• Managing the respective rights and expectations of beneficiaries, particularly with blended families.
• Avoiding disputes between family members.
• Relationships outside of the immediate family.
• Managing liabilities of the estate.
• Assets which may not be capable of immediate realisation or where value will be diluted by realisation.
• The transfer of assets through generations.
Estate planning seeks to not only distribute the assets of your estate but do so in a way that protects the estate, addresses issues within the estate, and fulfils your wishes.
What the stats say
While 4 in 5 of us rate our health as ‘very good’, 50% of Australians have a chronic condition that is likely to cause their death, 63% of adults are overweight or obese, and around 45% of us will experience a mental illness in our lifetime.
Leading causes of death differ by age:
• 1–44 years: suicide, land transport accidents
• 45–74 years: coronary heart disease, lung cancer
• 75 years and over: coronary heart disease, dementia and Alzheimer disease
It’s estimated that 138,300 people were diagnosed with cancer and 48,600 died from it in 2018.
Australia enjoys one of the highest life expectancies of any country in the world at 82.5 years (in 2015) and is ranked fifth among 35 OECD countries. Japan has the highest life expectancy at 83.9 years.
Men aged 65 in 2014–2016 could expect to live another 19.6 years (an expected age at death of 84.6 years) and the life expectancy of women aged 65 in 2014–2016 was 22.3 years (an expected age at death of 87.3 years).
We’re also working longer – 13% of Australians aged 65 and over participate in the workforce (17% for men and 10 for women). This is compared to 2006 when the workforce participation rate was 8%.