# What will you do with your Super?



## theasxgorilla (29 January 2007)

I'm curious to know what people intend to do with their superannuation once/if the music stops on the local and international bourses.  Europe, UK, US and Australian markets seem highly correlated.  Corrections over the last few years have been in unison, particularly more recent ones like that of May/June last year.

Is cash/fixed interest the only haven for Super?  Or do some people have "alternative" investments up their sleeve?


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## markrmau (29 January 2007)

It's one of the reasons I set up SMSF. If things go pear shaped I can sit it out in cash.

The only problem is that it will only become apparent in hindsight when the peak occurred.


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## Julia (29 January 2007)

markrmau said:
			
		

> It's one of the reasons I set up SMSF. If things go pear shaped I can sit it out in cash.
> 
> The only problem is that it will only become apparent in hindsight when the peak occurred.




I guess different personalities will react in different ways.  I have a low tolerance for anxiety so mostly run with about 35% in cash anyway.  There are good interest rates around at present.  I look at the recent performance of, say, BHP in my portfolio and compare its poor return, including minimal dividend, with some of the steady property trusts and infrastructure companies which yield over 6% plus some growth, and feel a lot more comfortable with the latter.  

If the pearshaped thing occurs, basic companies like Woolworths, big banks etc will always recover in time, and meantime provide an income.  The closer I get to retirement, the more I tend towards companies with a good yield.
Yes, I know you can always sell shares to provide an income, but in a downturn (and in SMSF you can't shortsell) it's psychologically more comfortable not to have to do this and still have plenty to live on from the dividends.

It's an interesting question.  Would be good to hear from others on this.

Julia


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## Smurf1976 (29 January 2007)

My super is in a fund which gives lots of options as to how it is invested both under their management or external management. That includes 100% cash if I want it through to 100% international shares or basically anything inbetween.

What I've been doing is that I have the funds in shares but I'm directing new contributions into cash until a correction comes along. Then I'll move that balance into shares.

This fund is not open to the general public. I was only able to join it due to working for a particular employer. But once you're in you can keep making contributions without needing to stay employed there so that's not a problem for me.  

I read in the paper today that there is some plan under which employer contributions will be taxed if the fund doesn't have your tax file number. This was said to apply from July 1 this year and apparently your employer isn't allowed to pass on your tax file number to the fund. So you need to make sure that your fund has your tax file number.


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## Julia (30 January 2007)

Hope no one minds my bumping this thread this morning.  There must be some other members who don't mind contributing their thoughts.

Julia


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## theasxgorilla (30 January 2007)

What I think sucks is that the majority of funds are "Australian Shares" or "International Shares"...unfortunately, if Australia tanks and the major international markets tank, it doesn't leave you with many places to manoeuvre.

What if you want to _pick_ a specific international market?

What if you want to bet on interest rates sinking and bonds going up?


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## tech/a (30 January 2007)

I'm SM.
With both Property (my business warehouse,workshop,offices and land,with rent to me---through the fund).
The cash side is in stock.
Even in bear markets or sideways markets there will be stock that out perform.

I'm in the process like a few others here at becoming proficient in Elliot Wave and Volume Analysis. Ive seen enough over the last 12 yrs to believe that this form of analysis will give those proficient THE EDGE when things taper off.

On an aside

Elliot practitioners believe that wave final wave 5 of a higher timeframe is completing (Around mid 6000s) and coinciding with wave 5's of lower timeframes.

On the plus side this will complete Wave 3 of the super cycle timeframe from 1929. Meaning a wave 4 correction folowed by a final wave 5 in the super cycle.

All mumbo jumbo ? Not really once you get a handle on it.
Ive given myself 2 yrs and am 6 mths in.


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## krisbarry (30 January 2007)

All super funds that I know of have the cash option, and members can transfer/switch fund options within a day or two.  So I don't reckon its much of an issue, if and when the market decides to crash/drop/correct.


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## nioka (30 January 2007)

Does it really matter? The market has it's ups and downs, unless you are drawing your super in the near future then you should be looking at the long term. It's only polititions who look only to the next election. Be positive. Think long term. Super funds should invest long term.
At my age I don't have long term so my strategy must be short term. I am comfortable because I thought long term a long time ago.
Project 1. Invest in property where you want to retire to.( If I had not done that years ago I may not have been able to do so now.)
Project 2. Decide what you would like to do for the rest of your life. Make your hobbies your life. 
Project 3. (3 comes AFTER 1 & 2) Work on financing it. 
 I do not have to worry about recessions. I own where I live, I could be self sufficient, or very nearly so, if things were real bad. I planned it that way. Being born in 1932, the great depression age, has probably influenced my thinking. 
 If you are worried about a recession only because you will not make enough money you will never be rich. It takes more than money to be rich and remember you can't take it with you. 
 There will be stock market recessions. They can even help you attain your goals but you need to know the goals in the first place.
Not what I started off to say but I may as well leave my thoughts in print!!!


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## marklar (30 January 2007)

Smurf1976 said:
			
		

> This fund is not open to the general public. I was only able to join it due to working for a particular employer. But once you're in you can keep making contributions without needing to stay employed there so that's not a problem for me.



Likewise I'm in an industry fund despite no longer working for that employer in a similar arrangement, I'm happy with how it's been performing and with the options for investment available.

I'm only 34, so it's a long time before I'll be allowed to touch my super, I'm sure the rules will probably change several times before I reach retirement age so I'm not too keen to stick vast slabs of $$$ into it just yet.

m.


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## TheRage (30 January 2007)

tech/a said:
			
		

> Ive given myself 2 yrs and am 6 mths in.




Tech I am interested to hear your thoughts on this. Have you been doing elliot wave analysis on All ords or the asx200. Where did you get data back to 1929?


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## markrmau (31 January 2007)

tech/a said:
			
		

> I'm SM.
> With both Property (my business warehouse,workshop,offices and land,with rent to me---through the fund).



Tech, are you sure you're allowed to do this? I thought that buying property with superfund and leasing to yourself or your business violated the sole purpose provisions.


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## clowboy (31 January 2007)

not if it is rented to yr business.


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## theasxgorilla (31 January 2007)

nioka said:
			
		

> Does it really matter?




Gee, I don't know, does it matter if your superfund is cut in half again like many did between 2000 and 2002?  I assume that you are familiar with the concept of a 50% loss requiring a 100% gain in order to get back to breakeven?  I'd prefer to sidestep declines where I can, frankly.


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## Duckman#72 (2 February 2007)

markrmau said:
			
		

> Tech, are you sure you're allowed to do this? I thought that buying property with superfund and leasing to yourself or your business violated the sole purpose provisions.




Yes Clowboy is right. The key is that it is rented to the business and it is a commercial property. You are unable to rent a holiday/residential property.


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