Quality or quantity

The clothes we wear, the furniture we sit on and the items we use throughout our lives take their toll on our savings and overall wealth. Not to mention the environment. Here’s how you can make long term choices, whether you’re investing in fashion, furniture or home decoration.

This season, go for quality and go green

The fashion industry thrives on telling people what the must-have items are from one season to the next. This season, help direct the conversation away from impulsive purchases to more considered, quality choices that are also more sustainable.

This begins with your fabric choices. Instead of purchasing a suit made with synthetic fabric that may only last a season, invest in a wool suit in classic styles and colours that you can wear for years to come. Cutting back on your consumerism reduces waste and saves you money in the long term.

The fashion industry leaves behind a huge environmental footprint. From the pesticides used to grow cotton to the chemicals found in fabric dyes, choosing organic fibres or sustainable fabrics, such as those made from bamboo or hemp, will significantly reduce the toll your clothing takes on the environment. Finding timeless, durable pieces will also mean your wardrobe is more distinctive and unique.

Earth-friendly furniture

When it comes to investing in furniture, there are a number of products on the market to look out for.

Wood is the obvious choice. It’s durable and is easily maintained — lessening the chance of it ending up in landfill and saving you money in the long run. Make sure you know where it comes from. Check for the Forest Stewardship Council (FSC) label; this ensures the product you’re buying is made from responsibly sourced wood.

Many furniture designers are using reclaimed wood in their products, sourced from old furniture or houses. Also look out for designers making the most of recycled metals and plastics, which lowers the demand for new materials and lessens the impact on the environment.

You could also invest in quality antique or vintage furniture that can be preserved, restored and potentially be a valuable asset that you could sell or pass on to your children — leaving a long lasting legacy.

Home sweet home

Making purchases for your home means considering the environmental and social impacts of manufacturing and the longevity of your items.

Here are a few key things to keep front of mind when making purchases for the home:

Aim to purchase high-quality products such as durable carpet, lounge suites and curtains. You may pay more up front but they’ll retain their value, last longer and have less of an impact on the environment.

• Look out for the energy rating on appliances such as washing machines, fridges, ovens and TVs.
• Buy local — this not only keeps Australian producers in business, but also reduces the environmental cost of shipping.
• Buy and sell second-hand products — donating items to charity and buying used products reduces the amount of items that go to landfill. This, in turn, can reduce the manufacturing demand for some products.

Grant Featherston chair

Grant Featherston was a famous Australian designer, best known for designing furniture. In 1955 the National Gallery of Victoria paid £14/1/6 ($28.15) for a Grant Featherston chair.

In 1955 this was an expensive chair but it has more than held its value since then. A chair like this was recently advertised for sale at $4,000. This represents an increase in value of 14 per cent per year comparing favourably to the rate of inflation which only increased by 4.6 per cent per year over the same period.*

Buying high-quality items might seem extravagant at the time but in years to come they may hold their value better than cheaper alternatives.

The purchasing decisions you make affect your wallet but they can also affect the planet.

Grant Featherston (designer) EMERSON BROS PTY LTD, Melbourne (manufacturer)

R152 Contour chair (designed — 1950); (manufactured — 1951) hardwood, plywood, linen, (other materials)

National Gallery of Victoria, Melbourne Purchased, 1955

1532-D4

© Grant Featherston/Licensed by VISCOPY, Australia

* RBA inflation calculator

Super opportunity for downsizers

After 1 July 2018, if you’re over 65 and sell your home, you can now put some of the money you receive into your super.

How does it work?

You can use the money from the sale of your house to make a ‘downsizer contribution’ to super of up to $300,000 or $600,000 for a couple.

Who is eligible?

You are eligible to take advantage of this scheme if you are aged 65 or over.

Unlike the non-concessional contributions, the good news is that you don’t need to be working and there are no age limits to making downsizer contributions. Also, the total super balance test of $1.6 million and the $100,000 non-concessional contributions cap restrictions don’t apply which makes it a great option if you want to contribute more to super and are currently ineligible because of these restrictions.

If you are considering selling your property and are interested in contributing to your super you should hold off selling until after 1 July 2018 as a property sold before this date is ineligible.

What types of properties are included?

The property must be located in Australia. It does not need to be your current home — it can be your, or your partner’s, former home as long as you or your partner have owned it for more than 10 years and lived in it at some point in your life. An investment property that neither of you have lived in is not eligible. But, the property does not need to be owned by both members of a couple for both of you to make a contribution of up to $300,000 to your super. Unfortunately, the sale proceeds from a houseboat, caravan or mobile home cannot be used.

For Tom and Hazel it’s time to downsize their $700,000 home to a smaller $500,000 home. After 1 July 2018, for the first time, they have the opportunity to boost their super with the remaining $200,000.

Note: If your family home is currently exempt from the Centrelink assets test and you sell it and put the money into super — your age pension entitlement could be affected.

For more information please contact us

Take the next step

To discuss your financial situation, make an appointment with a Bridges financial planner.

We have an established alliance with Bridges, to provide our customers with financial advice.

Bridges has been helping Australians with financial advice for 30 years. A Bridges financial planner will develop a plan specifically for you; one that’s tailored to your needs and circumstances to help you achieve your goals.

To make an appointment with a Bridges financial planner please contact us

The initial consultation is complimentary and obligation free.

Bridges Financial Services Pty Ltd (Bridges). ABN 60 003 474 977. ASX Participant. AFSL 240837. Part of the IOOF group

This is general advice only and has been prepared without taking into account your particular objectives, financial situation and needs. Before making an investment decision based on this information, you should assess your own circumstances or consult a financial planner or a registered tax agent. Examples are illustrative only. In referring customers to Bridges, Laboratories Credit Union Ltd does not accept responsibility for any acts, omissions or advice of Bridges and its authorised representatives.

Here at LCU, we’ve always been concerned we do our utmost to make every change in our business practises a positive one for the environment. Not only do we want to do our part for the planet, but we also want to share the many benefits of these changes with our members.

Read more: Save the Fees! Shave the Fees! Trees not Fees!

You may be aware that as of July 2017, there have been some big changes to Super. It’s important for you to understand what the new rules are and how they affect you.

Read more: Big Changes to Super