When we look at current asset allocation, we look at all the nest egg assets as these are the assets that aim to produce and income and benefit from capital growth.
So you would look at assets like:
- Cash (savings accounts, term deposits),
- shares,
- super,
- investment properties (the net value after any borrowing against that property)
For example, Joe has the following nest egg assets:
- Cash at bank: $25,000
- Share portfolio: $35,000
- Investment property less loan: $450,000 - $385,000 = $65,000
- Super: $250,000 (invested in cash 5%, Fixed interest 15%, Australian Shares 35%, International Shares 30%, Property 15%)
Total Value of Assets: $375,000
Joe’s Total Asset Allocation would be as follows:
|
Asset Class |
Overall Allocation for Joe |
Made up of: |
|
Cash |
$37,500 / $10% |
Cash at bank, portion of funds allocated to cash within super |
|
Fixed Interest |
$37,500 / 10% |
Portion of funds allocated to cash within super |
|
Australian Shares |
$122,500 / 32.66% |
Share portfolio and portion of funds allocated to cash within super |
|
International Shares |
$75,000 / 20% |
Portion of funds allocated to cash within super |
|
Property |
$102,500 / 27.34% |
Investment property and Portion of funds allocated to cash within super |