Our regular round-up of what Noel Whittaker is writing about, and why it matters to you.
In the August issue of Noel News, Noel Whittaker turns to a question that comes up at almost every family barbecue: what's the best way to put money aside for the grandchildren?
The obvious routes, he explains, are full of traps. Invest in a child's own name and the tax office applies penalty rates of up to 66 per cent to a minor's investment income. Hold the shares yourself instead, and the income lands on top of your own salary at your marginal tax rate — then capital gains tax (CGT) can apply when you eventually hand the portfolio over.
Noel's suggested alternative is the humble insurance bond. Earnings are taxed inside the bond at a maximum of 30 per cent, nothing has to go in anyone's tax return each year, and the bond can be set up to transfer automatically to the child at an age you choose — with no CGT on the transfer. Hold it for ten years and it can be redeemed tax-free. Until then, the adult who set it up keeps full control of the money, and because a bond with a nominated beneficiary generally sits outside the estate, it can bypass probate altogether.
For readers aged 40 to 60, this cuts both ways: it's a practical answer for your parents who want to help your kids, and a structure worth knowing about for your own grandchildren down the track.
"Can you think of a better intergenerational investment? The parent retains complete control."
Read the full article: Noel News August 2026 — investing for grandchildren — Noel Whittaker, Noel News, August 2026.
Passing money to the next generation without tax traps or family friction is exactly what Wills, Death & Taxes Made Simple is about. Buy direct from the author for $22.95 and you'll get both PDF and EPUB formats, ready to read on any device.