Page 3 - Advice Matters - Byfields Wealth May 24

Welcome to
another edition of Contents

‘Advice Matters’ 4 The power of compound interest
Magazine and regular interest over time
6 Supercharge your Super before
the clock strikes EOFY!
With the end of this financial year fast approaching thoughts that is where finance advice plays a critical role.
of maximising tax-deductible expenses is at the forefront of Whilst it might sound like future generations will be the 7 Ease your tax season stress
many people’s minds, a read of page seven may assist in richest in history, they are also the ones most exposed to
clarifying those thoughts. what is amounting to societal changing events in the form of 8 Are the new bitcoin ETFs the
Moving on from taxation related matters, you may be artificial intelligence. gamechanger you’ve been
interested to know that discussions about the financial and On November 30, 2022, OpenAI introduced ChatGPT, an AI
structural complexities of intergenerational wealth transfer chatbot capable of comprehending and answering a wide waiting for?
are on the rise. With that in mind we have included an range of questions, making suggestions, researching, and
excellent article on pages 20 and 21. writing essays, and even telling jokes. Many of these skills are 9 The worlds trillion dollar Stock
For those of you who are not familiar, intergenerational currently performed by workers in various jobs worldwide. So, Markets
wealth transfer refers to the process of passing assets, which occupations will face disruption due to generative AI?
wealth, and financial resources from one generation to the OpenAI conducted a study to identify U.S. industries and 10 Who expects to get richer in
next. Typically, this occurs from parents or grandparents jobs most “exposed” to large language models (LLMs)
to their children or grandchildren. As the older generation like ChatGPT. The term “exposed” refers to the potential 2024, by generation and gender
ages, they seek to ensure that their hard-earned wealth is economic impact, without distinguishing between labour-
preserved and continues to benefit their descendants. augmenting or labour-displacing effects. The results 11 How much can client’s earn
Over the past two decades, wealth transfers in Australia have encompass both jobs where humans could optimise their before paying taxes after age 67
been substantial. The total value of wealth transferred during work using AI and jobs that could be fully automated. from 1 July
this period was approximately $1.5 trillion, with inheritances
accounting for about 90% of this amount. Here are some key findings from the study: 12 Mercer periodic table of annual
These transfers are expected to continue growing, potentially Accountants: AI can handle 100% of tasks associated with
accounting.
quadrupling in real terms by 2050 due to household wealth investment returns
growth and an aging population. Admin and Legal Assistants: These roles are also 100%
exposed to AI.
Surprisingly, these wealth transfers have contributed to reducing 14 The potential estate complexities
some measures of relative wealth inequality in Australia. Climate Change Policy Analysts: AI can assist with of dying without a will
100% of their tasks.
Wealthier individuals receive more inheritances and gifts Reporters & Journalists: AI can fully replace their work.
in absolute dollar terms. However, when measured against Mathematicians: Both human and AI models can perform 15 Countries with the most
their existing wealth, those with less wealth experience a billionaires 2024
much larger boost from inheritances. In other words, wealth 100% of their tasks.
transfers tend to reduce the share of wealth held by the Tax Preparers: Human assistance is needed for 100% of 16 Fostering wellbeing in the
richest Australians. their work.
While inherited wealth plays a role in intergenerational Financial Analysts: AI can handle 100% of their tasks. workplace
wealth persistence, it is only a modest contributor. Writers & Authors: Human assistance is required for 17 Insurance recovery and claims
Other factors, such as education, networks, values, and 100% of their work.
opportunities provided by parents, significantly influence Web Designers: AI can assist with 100% of their tasks. process
relative wealth positions across generations. Additional Insights: repetitive tasks, data analysis, and
Globally, a significant wealth transfer is underway. Referred routine decision-making jobs face the highest risk of exposure 18 Regaining financial control after
to as the ‘great wealth transfer,’ approximately $68 trillion to AI. Industries related to information processing, such as IT, a scam
in assets is expected to shift from the estates of deceased have a higher exposure to LLM-based artificial intelligence.
baby boomers (those born between 1946 and 1964) to their As AI continues to advance, it is crucial for workers to adapt 19 The Mandie Case: the
heirs over the next 20-30 years. This transfer will shape the and acquire new skills. While some jobs may be at risk, others
financial landscape for generations to come. will emerge to support and enhance AI-driven technologies. importance of a binding death
Intergenerational wealth transfer is a complex interplay The future of work lies in striking a balance between human benefit nomination
of financial resources, family dynamics, and societal expertise and AI capabilities. In signing off, we hope that
implications. As families navigate this process, understanding you find this edition of our magazine to be of real value and 20 Connecting an adviser with your
the balance between preserving wealth and fostering interest and please always feel welcome to contact us at any
opportunities for the next generation becomes crucial and time if you have any questions. children
22 Life in retirement keeps getting
Byfields Wealth Management more expensive
Phil Alvaro | Matthew Yates | Jeremy Cook | Luke Buttersfield
Level 1, 89 Burswood Rd, Burswood WA 6100 P 08 9416 2222 www.byfieldswealth.com.au 23 The Wealth Report 2024
Disclosure: Phil Alvaro (Authorised Representative No. 231720), Matthew Yates (Authorised Representative No. 404885),
Jeremy Cook (Authorised Representative No. 441269) and Luke Buttersfield (Authorised Rep No. 242818) are Sub-Authorised
Representatives of Byfields Wealth Management, a Corporate Authorised Representative of Byfields Advice Pty Ltd AFSL 507506
3