November 30, 2012

Vol 2 Ed 9

Vol 2 Ed 9

Volume 2 Edition 9 Newsletter

Online at

Independent aged care, lifestyle and financial advice for seniors
Volume 2 Edition 9 – 30 November 2012



Living out our senior years in our own homes might be the desire of most people.  But sometimes living alone in a home that we own is not possible because of frailty or limited financial resources.

If financial constraints limit your housing options then Pensioner Rent Assistance might help. Pensioners with limited other income can receive help with their housing costs.  Rent Assistance can be paid to pensioners living with family but not to anyone who owns or is buying a house.

Read more about the benefits and restrictions of Pensioner Rent Assistance at

A ‘granny flat’ arrangement might suit pensioners who like to be near family, or friends, for social and personal support.

Any self contained living space in addition to the main residence might be called a ’granny flat’ by a real estate agent.  But a Centrelink client may have a granny flat interest in a home without having a fully self contained space.  Read about the Centrelink and DVA ‘granny flat’ provisions for pensioners whose names are not on the title to the property they live in at

Hint: Owning your own home and having some savings allows for a less constrained lifestyle in retirement.

A little history lesson re Mortgage Funds

Long ago, ‘mum and dad’ retail investors placed substanial amounts of money into mortgage funds. The mortgage funds paid good interest and withdrawals were processed promptly as new money arrived for investment.  Back then mortgage funds held some cash ready for new loans, and to pay interest to investors and to balance out the flow of new investments and redemptions to those investors who wanted their money for other purposes.  The major part of the money deposited with mortgage funds was lent out in the form of mortgages over real property.

Then came the global financial crisis.  When the GFC hit the flow of new investments slowed and the requests for withdrawals increased.  Many investors suddenly decided that they wanted their money out of mortgage funds and into banks.

Alas the mortgage funds’ borrowers were unable to repay all of their mortgages within a week and some had actually contracted to borrow more to finish building projects.  Most mortgage funds had to cease allowing withdrawals of capital and thus redemptions were ‘frozen’ whilst regular interest payments continued.

The majority of mortgage fund borrowers have continued to make payments according to their contracts.  Borrowers continued to pay their mortgage interest each month and the funds then paid interest to their investors.  Slowly, the mortgage funds collected more capital repayments from borrowers and small redemptions became available to many of those who asked for withdrawals.

One mortgage fund that was popular with retail investors has announced its next phase.  All investors in that mortgage fund will start receiving a regular small return of capital and no new investments will be accepted.

Howard Mortgage Fund Update

The Howard Mortgage Funds’ responsible entity has just announced that all investors in Howard Mortgage Funds will start redeeming their investments in January 2013.

Commencing January 2013, all investors in the Howard Mortgage Funds will receive monthly repayments of capital.  Regular interest payments will be made to all investors; the option of reinvesting interest into new units within the Howard Mortgage Funds will be closed.

You can read about the Howard Mortgage Funds Update at


Financial Care Services

Christine Hopper
Financial Care Services Pty Ltd
Independent aged care, lifestyle and financial advice for seniors in Melbourne, Victoria, Australia
Australian Financial Services Licence Number
299570 (check this at
Authorised Representative Number
252529 (check this at

Telephone – call +61 3 9808 0338
Email – contact
Address – mail or meet at 172 Warrigal Road, Camberwell Victoria 3124
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Disclaimer: The information contained in this newsletter is of a general nature only and does not constitute “financial advice”. You should obtain your own personal financial advice before investing any money or moving in to any retirement village, lifestyle community or aged care facility. Financial Care Services is licensed to provide financial advice to individual clients based on their personal situations.

© 2012 Financial Care Services Pty Ltd. All rights reserved.