About Allen Private Wealth Advice

STEVEN ALLEN Certified Financial Planner, B Com

Steven is qualified as a Certified Financial Planner which is the
highest professional credential offered to members of the Financial
Planning Association of Australia.

Steven was recently named as Australia's number one financial adviser in
the "Masterclass 2008" Australian Financial Review Smart Investor
magazine (February 2008).

Australian Financial Review Smart Investor and Personal Investor
magazine have seven times named Steven as one of Australia's Top 50
financial advisers.

Steven began his financial planning career in 1994 after completing a
Bachelor of Commerce Degree (B Com) from the University of Newcastle.
Steven is now Principal of his own Financial Wisdom practice, Allen
Private Wealth Advice.

Steven lives in Newcastle with his wife, Liesel and son, Noah. In Steven's spare time he loves to surf, play golf and walk his dog.

Financial Wisdom is responsible for the financial advice and services provided by Allen Private Wealth Advice.

Financial Wisdom Limited ABN 70 006 646 108 is the holder of an Australian Financial Services Licence ( no: 231138) and is responsible for the financial product advice given to you.

Financial Wisdom Limited is a financial planning organisation that has built a reputation for 'considered thinking' in offering financial advice. We are part of the Commonwealth Bank Group and have been a respected name in financial planning for over fifteen years.

During that time Financial Wisdom has earned an enviable reputation for high quality advisory services, based on a broad range of skills and a high calibre of specialist knowledge. This skill and knowledge is applied to develop services and solutions for clients and actively adds value to their financial planning, allowing them to take advantage of the expanding opportunities available.

Every Financial Wisdom Financial Planner is backed by a powerful network of support services, including active investment research resources, compliance support, technical support, ongoing educational support and professional development and access to a broad range of investment, superannuation and insurance products.

I conduct myself ethically and professionally in every aspect of my work and adhere strictly to the guidelines set out in the Financial Services Guide.

This guide provides you with information about the advice that we provide, and the Licensee that we represent: Financial Wisdom Limited. Its purpose is to educate you prior to us providing a financial service. You have the right to ask us about our charges, the type of advice we will give and to whom you can complain if you are unhappy.

For further details download the Financial Services Guide(pdf 468kb)

Age 50 Plus

Our sole focus at Allen Private Wealth Advice is retirement planning for the over 50’s. From age 50 onwards our clients are typically mortgage free and the children have been fed, educated and left home (hopefully!). They can now turn their attention and finances towards planning for retirement. The typical questions asked by our clients are:

• Do I have enough money to retire at age x?
• How much money do I need to retire on an income of $x a year?
• Am I on track?
• Could I be doing something different/better?
• What are the options available to me?

Pre-Retirees

70% of our clients are still working and are on the countdown to retirement. They are typically, 5 to 10 years away from their desired retirement age and are using their final working years to significantly boost retirement savings. They are looking forward to enjoying a wonderful lifestyle in retirement.

Retirees

30% of our clients have left the workforce. These clients are concerned about making their money last as long as possible whilst enjoying a wonderful lifestyle along the way. Typical questions asked are:

• How long will my money last on an income of $x a year?
• Can I afford that holiday/new car/home improvement? How will it affect my capital?
• How can I qualify for maximum Centrelink benefits and concession cards?

Hands-Off Investors

Whilst our clients wish to be informed and sign-off on all investment decisions they do not want to be involved in the day to day decision making and management of their investments. We do not cater to “DIY” investors who wish to trade their share portfolios. We leave this activity to professional investment managers who we believe will do a much better job than the individual. Our clients choose to enjoy their lifestyle and interests over managing a daily investment portfolio.

Under Age 50

There are a few exceptions but largely we do not have many clients under the age of 50. This is due to our business decision to focus on retirement planning only. The major focus of finances for the under 50’s is to repay home loans and educate children. If this describes your situation then we suggest you consult a financial adviser who specialises in “wealth accumulators” (this is the industry name given to the under 50’s).

DIY Investors

If you would like to actively manage your investments, in particular, regularly buy and sell shares then Allen Private Wealth Advice are not the financial advisers for you. We hold no special expertise in buying and selling shares. We leave this activity to professional investment managers. Our clients invest in Australian shares, global shares and listed property trusts through managed funds. We believe that a professionally managed investment portfolio will outperform a DIY portfolio over the long term and after fees. We have many clients who own listed shares, however, they are managed on a passive “buy and hold” basis.

Get Rich Quick

We are not attractive to the “get rich quick” brigade. We do not recommend borrowing. We do not recommend share trading. We do not recommend real estate. There will be no 0 to 100 properties in 1.5 years or margin lending into hot stocks. We do not recommend agri-business. We do not recommend hedge funds. We avoid the latest fad investment like the plague.

Retirement Planning Only

We only offer one service to our clients – retirement planning. Our client’s major financial goal is to secure and enjoy a comfortable retirement. Our job is to find a financial solution which will let them achieve this. We have spent the past 14 years building our specialist knowledge, expertise and services in retirement planning only.

We are not looking to be the biggest financial advice firm. We are looking to be the best in our own niche area of retirement planning. We want to do one thing only and do it really well. Our philosophy is to stay within our “circle of competence” and add real value to our client’s financial position where we know we can. We deliberately seek to avoid areas outside of our very small circle.

If you browse other firm’s offerings you will find that many offer advice across all ages, financial situations and significantly more services. In effect, seeking to be a one-stop shop for everyone. We believe that being all things to all people will result in mediocre advice and service.

Our preference is to give a high level of advice and personal service to a smaller number of clients in a single field. A favourite quote of ours is “the secret to appearing like a genius is to become an expert in one area only…and then never stray”.

High Level Of Knowledge and Expertise

Like all professions the quality of financial advice varies between the good, the bad and the ugly. Unfortunately, bad or ugly financial advice can result in the potential loss of a lifetime’s worth of savings. Therefore, it pays to choose your financial adviser carefully. It is imperative that you can trust the financial advice given the consequences of poor financial advice. Allen Private Wealth Advice takes great pride in the quality of our financial advice. We believe our expertise and knowledge is of the highest level in Australia.

Steven Allen has been recognised by Australian Financial Review – Smart Investor magazine’s “Masterclass” as Australia’s number one financial adviser (January 2008). Steven has been 7 times named as one of Australia’s Top 50 financial advisers.

Our clients are always up to date with the latest strategies and can be confident that they are not paying any more tax than need be or missing out on Centrelink benefits. We have a strong knowledge and technical expertise in the areas of superannuation, retirement income streams, investments, tax, Centrelink and estate planning. More importantly we know how they all work together to achieve successful retirement outcomes. We believe that technical expertise is the single area where a financial adviser can make the greatest difference to a client’s financial outcome.

We believe we can create more unique and original financial solutions than our competitors.

Our Philosophy For Growing Wealth

We differ from our competitors by actually having a philosophy for growing wealth.

Most financial advice firms are a disparate group of individuals with extremely different views on how to grow your wealth. Even within a single office you will find no common philosophy or consistent advice between adviser ”A” and adviser “B” who may sit in offices only metres apart. There is every chance they have different clients, different fee structures and different philosophies. What these philosophies are you will have to ask them. This means that trying to choose a financial adviser based on a firm’s reputation is a hit and miss affair.

We believe our clients should understand and be aligned with our investment philosophy.

There are six core beliefs to Allen Private Wealth Advice’s philosophy for growing wealth:

1. Partner with a financial adviser for greater wealth
2. Control what you can control
3. Diversify
4. Own shares like you are a business owner
5. Let the Government help you
6. Stay within your circle of competence

1. Partner with a financial adviser for greater wealth

We believe that private investors who partner with a financial adviser will generate greater wealth than those who choose to go alone.

We know what those without a financial adviser do – they do nothing. How do we know this? We are privileged to see individual’s financial strategies every single working day. For most people apathy reigns supreme. On the other hand clients of Allen Private Wealth Advice all have financial plans in place and more importantly are taking actions. It is a rare day when we can not improve someone’s financial position in some significant way. Even with experienced investors we quite often find they have missed an opportunity through a case of “not knowing what they don’t know”.

2. Control what you can control

We believe that private investors should focus on the areas that they can control to grow their wealth.

This core belief is the foundation stone for all of our strategies.

To achieve a goal you must be able to work towards it with some type of predictability. Some areas of growing wealth you can control (are predictable) and other areas are beyond your control (unpredictable). We believe in focusing on the “controllables”.

So what can you control?

• Your spending and saving
• Your investment strategy (asset allocation)
• Your choice of tax vehicles
• Your choice of Centrelink vehicles
• Your cost of investing
• Your insurance cover
• Your estate plans

These are all areas you can exert personal influence over to ensure you are tracking towards your retirement goal.

So what can you not control?

• You can not control markets

You can not influence the price that someone is willing to pay for an investment that you own. Sir Isaac Newton who lost a fortune in the South Sea Bubble declared “ I can calculate the movement of heavenly bodies but not the madness of crowds”. Markets are not efficient. Markets are highly contagious to the emotions of fear and greed. When everyone is happy and optimistic then prices are sky high. When everyone is fearful then prices can fall very low. This manic depressive persona of the market is extremely important to understand before investing any money into growth assets of shares and property. It is important to know in advance that prices can fall sharply. Growth assets will provide a better return than cash and bonds when held for long periods of time (10 years or more) but with the trade-off of volatility (ie rises and falls).

Our philosophy is to take a long term buy and hold approach and ride out all market cycles. We do not switch our clients money in and out of markets attempting to time the highs and lows of markets. We consider this a high risk and losing strategy.

3. Diversify

We believe that private investors should diversify between asset classes, investments and investment managers.

We do not know which asset class will outperform in each individual year so we diversify across all asset classes.

We do not know which investments will outperform in each individual year so we diversify across investments.

We do not know which investment managers will outperform in each individual year so we diversify across investment managers.

A favourite quote of ours is “There are only two types of sharemarket forecasters, those that don’t know and those that don’t know that they don’t know”. We freely admit that “we don’t know” where sharemarkets will go in the short term and this is why we diversify. No single asset class, investment or investment manager will consistently outperform over all market cycles over time. Diversifying gives a smoother ride.

4. Own shares like you are a business owner

We believe that private share investors should focus on owning quality businesses for long periods of time and reaping the benefits of dividends and retained earnings.

A share is a part ownership of a business. Therefore, you must invest like you are a buying a business. A favourite quote of ours is “The best time to sell a great business is never”.

Once you own a portfolio of quality businesses then you should hold on to them for long periods of time so you can reap the benefits of dividends and retained earnings.

5. Let the Government help you

We believe that private investors should structure their finances to take maximum advantage of the tax and Centrelink rules.

Our philosophy is that a dollar saved is a dollar earned. The beauty of paying less tax or qualifying for a Centrelink benefit is that there is no investment risk attached to it. It is guaranteed. It is also an area that you can control by simply organising your finances in a smarter way.

It is Allen Private Wealth Advice’s knowledge of tax and Centrelink rules which adds greatest value to our client’s wealth.

6. Stay within your circle of competence

We believe that private investors should outsource their strategy to a financial adviser and their investment management to professional fund managers.

If you hold no special expertise in managing an investment portfolio then we do not believe that retirement is the best time to start learning. There are very expensive lessons to be learnt in the market for novice investors.

We believe that after fees and taxes you will grow greater wealth by outsourcing strategic direction to a financial adviser and investing in professionally run managed funds.

Cost of a First Meeting

The first meeting is no cost and obligation free. The first meeting is for us to “get to know you” so we can learn your financial position and goals. If we mutually agree that Allen Private Wealth Advice can help you then we will quote you the cost of a financial plan.

Cost of a Financial Plan (known as a “Statement of Advice”)

You will be sent a quote in the mail for the cost of a Statement of Advice after the end of our first meeting. The cost will depend on time and complexity. There is no obligation to proceed with the quote.

Cost of Placing Investments

There will be no entry or exit fees on recommended investments. 100% of entry fees are rebated back to our clients. We do not recommend exit fee products.

Cost of Ongoing Advice

To receive ongoing advice and service from Allen Private Wealth Advice we charge a fee as a percentage of your advised portfolio. The percentage will be disclosed in your Statement of Advice.

We may also receive an ongoing commission for some investment products. These commissions will be disclosed in your Statement of Advice.

Please refer to our Financial Services Guide for more information on fees.

First Meeting “Get to Know You”

The first meeting is no cost and obligation-free. Before our first meeting we will send you a questionnaire to start you thinking about your financial goals and financial position. At the meeting we will work through the questionnaire together so we can understand your current financial situation and the financial goals you are trying to achieve.

2nd Meeting “Your Financial Plan”

At the second meeting, your financial adviser will present you with a clearly written Statement of Advice, including recommendations on:

• How to secure a comfortable retirement
• Which investments are right for you
• How to pay less tax
• How to maximise Centrelink benefits
• All costs clearly disclosed and explained. Allen Private Wealth Advice is “fee for service” which means there will be no entry fees, no exit fees or trailing commissions.

3rd Meeting “Discuss, Fine-tune, Understand”

After you have had to time to read and consider the Statement of Advice we will invite you back for a third meeting to discuss any of the advice which may need further explanation or fine-tuning. It is very important to us that your decisions should be informed and made with confidence.

Implement Advice “We Take Care of the Paperwork”

If you agree to the recommendations then we will arrange all paperwork on your behalf in a timely manner.

Ongoing Review of Advice “The Only Certainty is Change”

Your plan will be reviewed for any changes in your personal circumstances, Government legislation or investment markets. We are available to speak to you at any time should you have questions about your financial plan.