Average financial intelligence?

Julia · 15 April 2012

Starcraftmazter said:
?? Where, please chuck us a link, I would switch immediately. They cheapest I've seen are probably around $800.

I can't be bothered looking for a link. Shop around.
I paid $500 for the financial year just gone.

But don't you see Julia - there's a very simple incentive the government can use to entice people to save. Remove pension benefits. No need to regulate anything, people can save for their retirement much easier without having to pay for stupid regulations, and the government can even lower the tax rate to help people save because it would reduce it's expenditure. Everyone wins!

Your inexperience shows. Yes, it sounds OK in theory. But people simply fail to save.
Consider all the arguments just in the preceding posts. Even young-gun - probably quite a bright young person - says he 'doesn't have time' to educate himself, so therefore one assumes he will simply decide investing for his retirement is too hard.

(Not meaning to have a personal go at you, young-gun: just using your remarks as an example).

For heaven's sake, SCM, I'm sure you know that a significant proportion of the population spends more than they earn even now? What makes you think they would voluntarily save for providing a living for themselves at a time that has no sense of reality to them?

Starcraftmazter · 15 April 2012

Julia said:
Your inexperience shows. Yes, it sounds OK in theory. But people simply fail to save.
Consider all the arguments just in the preceding posts. Even young-gun - probably quite a bright young person - says he 'doesn't have time' to educate himself, so therefore one assumes he will simply decide investing for his retirement is too hard.

(Not meaning to have a personal go at you, young-gun: just using your remarks as an example).

For heaven's sake, SCM, I'm sure you know that a significant proportion of the population spends more than they earn even now? What makes you think they would voluntarily save for providing a living for themselves at a time that has no sense of reality to them?

If they don't save Julia, who's fault is that? The government? Yours? Why should you or I subsidise others?

As for saving, according to the non-consumption ratio (otherwise known as a savings rate), people do not spend about 11% of their net income, implying that they are in fact capable of saving.

Now let's look at the current situation...most people haven't got a clue about super - because they are deluded into the fallacy of thinking the government will take care of it, and thus their super is most probably mostly in stocks, which means some managed fund out there delivers them crap returns and charges massive fees. And forget bonds during a time of ZIRP and the Eurocrisis. God forbid their fund allocates some proportion of their super to property.

Now imagine none of this was mandatory. Imagine of John Johnson could start work after doing whatever education or training, and the free market would be blasting him with advertisements and promotions to put some small proportion of his hard earned money in a 6% savings account to save for his retirement - not eaten away by fees nor regulations. Hell, I bet you banks will offer him a few thousand dollars if he agreed not to withdraw any money for a long time - because banks will know just how much more they will make by him putting in a few extra $100 every now and again.

You are underestimating the power of freedom from needless regulation and the creativity of the free market. It can't be as bad as it is now, where Australians collectively lost hundreds of billions of super $ during the GFC.

Bill M · 15 April 2012

Starcraftmazter said:
No need to regulate anything, people can save for their retirement much easier without having to pay for stupid regulations, and the government can even lower the tax rate to help people save because it would reduce it's expenditure. Everyone wins!

We do need the regulation. Super is regulated mainly so younger people can not draw on it until they retire on or after 60. When I was working through the 70's and 80's there was no such thing as the superannuation guarantee. People lined up for their pay packet each week and by the time they lined up for the next week they had blown the lot and saved zero.

Aussies are lousy savers, if the superannuation system and their regulations didn't exist then there would be 99% of Aussies drawing on a pension in the future.

I have got countless examples of those I worked with 20 to 25 years ago who had nothing and until the day they retired still had nothing. Their super (with all those regulations) enabled them at the very least to buy a home outright with their lump sum, it works, believe me as I am about to collect mine soon.

Starcraftmazter · 15 April 2012

Bill M said:
Aussies are lousy savers, if the superannuation system and their regulations didn't exist then there would be 99% of Aussies drawing on a pension in the future.

Not if the pension did not exist.

Julia · 16 April 2012

Simple question for you SCM:

In this halcyon society where there is no old age pension, what would you have happen to those who, for whatever reason, failed to save and thus had no income in their old age?

Starcraftmazter · 16 April 2012

Julia said:
Simple question for you SCM:

In this halcyon society where there is no old age pension, what would you have happen to those who, for whatever reason, failed to save and thus had no income in their old age?

Family support, Charities, Shelters, Work if they can, etc.

Whatever that doesn't involve hard-working taxpayers subsidising the failure of others.

McLovin · 16 April 2012

Starcraftmazter said:
Family support, Charities, Shelters, Work if they can, etc.

Whatever that doesn't involve hard-working taxpayers subsidising the failure of others.

Maybe you should familiarise yourself with what FDR called "enlightened self-interest".

Starcraftmazter · 16 April 2012

McLovin said:
Maybe you should familiarise yourself with what FDR called "enlightened self-interest".

Do you imply it is wrong to represent the interests of taxpayers?

Julia · 16 April 2012

Starcraftmazter said:
Family support, Charities, Shelters, Work if they can, etc.

What about those who have no families?

Who will fund the charities?

Who will fund the shelters?

Work? Who is going to employ an 80 year old, frail, and in need of medical care?

Let's take it a step further, SCM:
You don't want taxpayers funding any care for individuals. Let's say you have a catastrophic accident (not wishing it on you, of course) which leaves you paralysed and completely dependent. There is no hope of your condition being reversed.

How are you going to pay for lifetime care?

Chasero · 16 April 2012

Just a question, are any of your supers still in negative?? (those that do not have a SMSF)

Comparing my employer contributions over the past year or so, my superfund balance is down by 4%?? That doesn't seem right.

Starcraftmazter · 16 April 2012

Julia said:
What about those who have no families?

Who will fund the charities?

Who will fund the shelters?

Historically and still to this day, people of all walks of life donate money to charities who run shelters and other programs for the poor. Many religious groups also do the same.

Think of it this way. If you didn't have to pay that much tax, you would have more money to donate to charities - which would do a better job of taking care of people who may need help.

Julia said:
Work? Who is going to employ an 80 year old, frail, and in need of medical care?

That's just one extreme. By the time most people retire, they can still do work. If you go to Sydney's CBD, you can see many rather old looking individuals working for the council cleaning the sidewalks and such.

Of course that wouldn't be necessary if they saved enough for retirement.

Julia said:
Let's take it a step further, SCM:
You don't want taxpayers funding any care for individuals. Let's say you have a catastrophic accident (not wishing it on you, of course) which leaves you paralysed and completely dependent. There is no hope of your condition being reversed.

How are you going to pay for lifetime care?

With the gold that I have in my safe?

Again, family, charity, etc. If I would need a lot of medical care and I would be unable to contribute to society, the question would have to be asked - what would be the purpose of my continued existence in such a scenario? Perhaps there wouldn't be.

I don't know about you, but I don't see the point of living if you're paralysed.

Chasero said:
Just a question, are any of your supers still in negative?? (those that do not have a SMSF)

Comparing my employer contributions over the past year or so, my superfund balance is down by 4%?? That doesn't seem right.

Switch to cash.

McLovin · 16 April 2012

Starcraftmazter said:
Do you imply it is wrong to represent the interests of taxpayers?

No, you infer that. I imply that a country is a better place to live because it looks after those who are less fortunate. Indirectly it benefits all of society not just those who are receiving money from the government.

Bill M · 16 April 2012

Chasero said:
Just a question, are any of your supers still in negative?? (those that do not have a SMSF)

Comparing my employer contributions over the past year or so, my superfund balance is down by 4%?? That doesn't seem right.

One is in growth, 80% stocks and 20% defensive, it is just 2% behind the 2007 peak.

The second (wife's) we converted 25% to cash (the rest in balanced) when the all ords hit 5,000 and it is in front and growing well.

The 3rd. I converted to cash and bonds and since the 2007 peak is well in front.

Regardless of what some people say, you do have a lot of control with your super. None of the above form any part of a SMSF.

Starcraftmazter · 16 April 2012

McLovin said:
No, you infer that. I imply that a country is a better place to live because it looks after those who are less fortunate. Indirectly it benefits all of society not just those who are receiving money from the government.

That's pretty subjective. Different people want different things from a country. I dream of a world where different groups of people will organise themselves into countries based on how they want their country to function.

Then nobody anywhere will have to complain about the government, since everyone will get what they want.

Unfortunately, now, very few if any people get exactly what they want.

So_Cynical · 16 April 2012

Chasero said:
Just a question, are any of your supers still in negative?? (those that do not have a SMSF)

Comparing my employer contributions over the past year or so, my superfund balance is down by 4%?? That doesn't seem right.

If your invested 100% in Aust stocks or high growth...id say its about right.

Julia · 16 April 2012

Bill M said:
Regardless of what some people say, you do have a lot of control with your super. None of the above form any part of a SMSF.

Yes, because you have taken responsibility for your own financial literacy.

Starcraftmazter said:
Historically and still to this day, people of all walks of life donate money to charities who run shelters and other programs for the poor. Many religious groups also do the same.

If you seriously imagine charities could fund the equivalent of pensions and healthcare you are even more out of touch with reality than I have so far deduced.

That's just one extreme

It's not an extreme. Force yourself one day to walk through a few of the nursing homes in your area. Spend a day with the Meals on Wheels volunteers who take food to the aged in their homes because they are too frail to even shop and cook for themselves.

.

By the time most people retire, they can still do work. If you go to Sydney's CBD, you can see many rather old looking individuals working for the council cleaning the sidewalks and such.

Oh right. Just get all the folk over 80 out there on their walking frames cleaning the streets. How is it that you apparently have no idea how ridiculous, not to mention heartless, you are!

Of course that wouldn't be necessary if they saved enough for retirement.

True, but there will always be a proportion of people who through no fault of their own, e.g. illness, social disadvantage etc, have been unable to save enough for retirement. Not everyone is created equal, and some folk just barely struggle through life. We have a social and moral obligation to care for such people.

Again, family, charity, etc. If I would need a lot of medical care and I would be unable to contribute to society, the question would have to be asked - what would be the purpose of my continued existence in such a scenario? Perhaps there wouldn't be.

I don't know about you, but I don't see the point of living if you're paralysed.

Agree, but as the law stands you would have no choice so you will still have to account for how to pay for decades of intensive medical care. To assume family and/or charities will be able to meet such costs is naive in the extreme except in rare instances.

McLovin said:
No, you infer that. I imply that a country is a better place to live because it looks after those who are less fortunate. Indirectly it benefits all of society not just those who are receiving money from the government.

+1.

Starcraftmazter · 17 April 2012

Julia said:
Oh right. Just get all the folk over 80 out there on their walking frames cleaning the streets. How is it that you apparently have no idea how ridiculous, not to mention heartless, you are!

I'm not heartless, life is life, you have to live by the choices you make. I don't know how they got to be there, but most didn't. Wonder why?

Julia said:
True, but there will always be a proportion of people who through no fault of their own, e.g. illness, social disadvantage etc, have been unable to save enough for retirement. Not everyone is created equal, and some folk just barely struggle through life. We have a social and moral obligation to care for such people.

Yes, and that is where the charities come in. This proportion of people is very very small.

If you look at boomers, almost all of them have property they can sell to generate enough money to pay for their retirement. It is completely unnecessary for the government to do anything for them.

Julia said:
Agree, but as the law stands you would have no choice so you will still have to account for how to pay for decades of intensive medical care. To assume family and/or charities will be able to meet such costs is naive in the extreme except in rare instances.

Well obviously this is another area of law which should be changed. The government has no right to interfere in such personal choices.

Chasero · 17 April 2012

So_Cynical said:
If your invested 100% in Aust stocks or high growth...id say its about right.

Yep.. I am in 'growth' not 'high growth' but my superfund has pretty much underperformed against other superfunds.

I will probably switch superfunds by the end of this year.

Knobby22 · 17 April 2012

Starcraftmazter said:
Yes, and that is where the charities come in. This proportion of people is very very small.

.

I'd love to know if you have ever worked for a charity.
Also, are you getting HECs?

I think your idea of little countries who run themselves equates to the gated communities of the US which have their own police force, doctors golf courses etc.
You would love it .... if you had a couple of mil. You don't even have to see an average person.

Starcraftmazter · 17 April 2012

Chasero said:
Yep.. I am in 'growth' not 'high growth' but my superfund has pretty much underperformed against other superfunds.

I will probably switch superfunds by the end of this year.

It's mostly random buddy, a fund that does well one year will probably do poorly the next year, and vice versa.

Average financial intelligence?

Julia

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Starcraftmazter

Bill M

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Julia

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McLovin

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Julia

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Julia

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Starcraftmazter

Chasero

Knobby22

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