Average financial intelligence?

[Starcraftmazter]

Re the unsustainability of the age pension, this is why the compulsory Super levy is about to be increased. Let's hope that will ensure more people are self funded in retirement in the future.

I really hope so, though I fear people will have enough to afford high-cost healthcare especially late in their lives. Again I bring this back to regulations which siphon away people's super through stupid regulatory and other fees which encourage an environment where people's money is easily preyed on by under-performing fund managers by not giving people the ability to put their money in relatively safe and high yielding investments from the start.

Do you make no allowances for those who simply lack capacity? This can be as a result of genetic or social disadvantage, plus physical or mental illness.
What would you have happen to these people who are, through no fault of their own, unable to work enough to provide financially for themselves?

Well the basic social contract in a liberal country is that as an individual you work to the best of your ability to contribute to the state, and in turn the state will help you when you most need it.

However, if there are individuals that at no point in time are capable of contributing to the state, then they are essentially leeching off the success of others, and I really don't like that. As cruel as it may seem.

The way I figure it, these people will be split into two categories. The vast minority whom have a legitimate reason to not be able to work. Now this group of people I feel will receive adequate support in any modern progressive society - even if it is not liberal. This will happen because as you say the notion that many people will have that these people should be cared for, and thus enough people will always be willing to donate their money towards their case. My philosophy is that mandatory taxation for this purpose is not necessary in a modern society in order for this outcome to occur.

The second group - who are capable of work and are just too lazy, a group which I feel is superior in size, will then have no excuse to laze around and do nothing.

If this were not so sad, it would be funny.

What? It is seriously an extremely easy and undemanding job. And given Australia's high minimum wages...I really can't feel sorry for these individuals.

You clearly have no idea of the practicalities involved or the dollar numbers involved.
Who on earth is going to contribute enough to charities to fund the healthcare and pension system? You must be living on some faraway planet.

Further, charities are great institutions by and large, but they are largely made up of well meaning amateurs. What makes you think they would have even the slightest capacity of administering such a massive system as Australia's healthcare and pensions?

I am not suggesting that the responsibility be moved to charities, I am suggesting the pensions are unnecessary and unsustainable heading into the future, and the worst affected can be looked after by charities.

Healthcare is another matter altogether. It is the most unsustainable of all government expenditures heading into the future. I believe that in a free market economy, public healthcare has no place.

I remind you that by not having to pay taxes for these things, people will have drastically more money to donate to charities. If they so choose, and if they feel it is their social responsibility, they can donate more money than otherwise to various charities.

The government has no right to take people's money and spend it on arbitrary things which the taxpayers have no input on. I am merely advocating democracy, whereby people spend their money how they want to, and support charities which they want to - to the extent they feel is necessary to maintain a healthy society.

The government has no right to make these decisions for the millions of people that live in it's country. That's basically communism.

• UniSuper
• Australia Post Superannuation Scheme
• CBH Superannuation Fund
• Goldman Sachs & JB Were Superannuation Fund
• Catholic Super
• Care Super
• Hostplus
• Australian Super
• MTAA Super

These aren't really individual funds - merely providers of super? For all of them, any performance information that I found confirmed my accusation that it bounces around a lot. And we will certainly see more of that in the future.

 

[ROE]

I disagree, I'm for the Aussie system in its current form..it not perfect but it is one of the best...

SCM You are not the only person paying tax, lot more people on this forum pay hell more tax than you, not everyone has this view so you cant claim government cant do this or that...

almost everyone young to old has some sort of tax payer kick in for them at some stage.

Do your parents get family benefit A or B
Do you use Medicare before you have a job?
Do you pay upfront or use HECS for your education
Do you use public transport?

Do you know for sure you wont be on some form of government pension when you are old and no longer able to hold a job?

That what first world countries do to their citizens, spread the love and try to help
everyone where they can...

at different stage in life people require different sort of help...to a young person it's a waste of money helping people with super, to someone older it's a damn good idea...

who are we to judge who should be getting the help and who should not..let the elected officials do what they elect to do....it may not to someone liking but that is what they are elected to do...

 

[So_Cynical]

These aren't really individual funds - merely providers of super? For all of them, any performance information that I found confirmed my accusation that it bounces around a lot. And we will certainly see more of that in the future.

Investment returns, interest rates, equities bounce around....sure do. :bonk:

 

[McLovin]

Well the basic social contract in a liberal country is that as an individual you work to the best of your ability to contribute to the state, and in turn the state will help you when you most need it.

I am merely advocating democracy, whereby people spend their money how they want to, and support charities which they want to - to the extent they feel is necessary to maintain a healthy society.

So, as I understand the basic contract is between the state and the individual, but the state should be removed from the equation because in order to advance democracy individuals should choose how much to give to charity in order to maintain a healthy society.

It's like watching a dog chase his tail.

 

[Starcraftmazter]

who are we to judge who should be getting the help and who should not..let the elected officials do what they elect to do....it may not to someone liking but that is what they are elected to do...

You're right, we should all live as subjects of the state

The state has a bias in favour of families at a penalty to everyone else, and specifically it benefits people who have more children than they can afford. Stupidly, this is to spur economic growth through population growth in an unsustainable economic system. The state is chronically inefficient and ineffective at spending money and has a real problem with foresight. The worst part is that which party or parties are in power is irrelevant and makes no difference.

And that's just the start of my beef.

but the state should be removed from the equation because in order to advance democracy individuals should choose how much to give to charity in order to maintain a healthy society.

Correct.

 

[Tyler Durden]

This may be relevant:

OPPOSITION Treasury spokesman Joe Hockey has indicated a Coalition government would look at cutting welfare and other entitlements to offset lower personal income and business taxes.

Mr Hockey told policymakers in Europe the "age of entitlement" in Western countries was over.

"We are all living longer and the longer we rely on government handouts, the greater the burden for taxpayers and particularly those that follow," he told ABC TV from London after his speech.

But he said the problem in Australia was not as bad as many European countries where 20-30 per cent of the gross domestic product (GDP) was government welfare spending.

In Australia, the level is only 16 per cent of GDP.

However, Mr Hockey though there was still work to be done to reduce this.
"We need to compare ourselves with our Asian neighbours where the entitlements programs of the state are far less than they are in Australia," he said.

"If we talk about the Asian century ... then the Asian countries are our competition, our children's competition."

In his speech, he reportedly said all government-funded pensions and similar payments must be means tested.

He highlighted the example of Hong Kong where the top rate of income tax is 17 per cent but there is no social safety net provided by the government.

Mr Hockey refused to comment when asked about specific entitlements the Coalition would get rid of, saying instead they would "continually look at ways to ensure that people get a fairer deal through lower taxes and less government spending".

He said his speech was "mainly directed at countries spending between 20 and 30 per cent of GDP on welfare" although the Coalition believed more entitlements could be cut in Australia too.

http://www.news.com.au/national/joe-hockey-flags-welfare-cuts/story-e6frfkvr-1226332171883

 

[Starcraftmazter]

^ I like his speech, but this is the key paragraph.

Mr Hockey refused to comment when asked about specific entitlements the Coalition would get rid of, saying instead they would "continually look at ways to ensure that people get a fairer deal through lower taxes and less government spending".

I also don't like framing expenditure as a proportion of GDP since it paints a very misleading picture. I think they should call it for what it is... $121Bn, 33% of the federal budget, and it's single biggest component.

Can you imagine if we paid 33% less tax? And this is without even touching healthcare! By the way, healthcare spending is less than half of welfare.

Too much.

 

[Julia]

Re Joe Hockey's statement

In his speech, he reportedly said all government-funded pensions and similar payments must be means tested.

Aren't they already?

Age, Disability and Newstart certainly are. The Blind pension is the only one I know of that is not.
The unemployed even have to use up their meagre savings before being granted the hugely generous dole.

 

[McLovin]

Re Joe Hockey's statement


Aren't they already?

Age, Disability and Newstart certainly are. The Blind pension is the only one I know of that is not.
The unemployed even have to use up their meagre savings before being granted the hugely generous dole.

What a disgrace the blind are. Isn't there a charity that can help them instead of me being forced to through taxes!

 

[Glen48]

Typical Pollie say what ever they likes in opposition but will be afraid to implement once in office or refuse to talk about it whilst running for office.
Dream on , move on nothing to be seen here.

 

[Knobby22]

Re Joe Hockey's statement


Aren't they already?

Age, Disability and Newstart certainly are. The Blind pension is the only one I know of that is not.
The unemployed even have to use up their meagre savings before being granted the hugely generous dole.

He said means tested but he really meant meanie tested.
It makes me a little scared when the Opposition says things like that, but he is probably only wolf whistling as Glen said.

I lived in Indonesia and have seen the humpies many are forced to live in. Not how I see the future for Australia.

 

[Julia]

He said means tested but he really meant meanie tested.
It makes me a little scared when the Opposition says things like that, but he is probably only wolf whistling as Glen said.

I felt similarly, Knobby. Given all the criticism the Coalition have levelled at the government for their 'out of control' spending, I fear that when they do take office they may wreak social havoc in the name of getting the finances under control.

It's more of a concern, too, if Hockey does become Treasurer. Hard to have confidence in his capacity in this regard. I'd feel a lot happier if it were to be Malcolm Turnbull who has the economic credentials and probably a more generous social outlook.

 

[McLovin]

The funny thing is, half the people who this sort of stuff appeals to are probably taking their fair share of middle-class welfare anyway.

People are quite happy to engage in this sort of rhetoric until they start losing out, at which point they go to ACA or TT and start complaining about how high the cost of living is and how the government should be doing more to help "working families".

 

[disarray]

The funny thing is, half the people who this sort of stuff appeals to are probably taking their fair share of middle-class welfare anyway.

People are quite happy to engage in this sort of rhetoric until they start losing out, at which point they go to ACA or TT and start complaining about how high the cost of living is and how the government should be doing more to help "working families".

middle class welfare wouldn't be necessary if people weren't taxed so much. it's not only direct PAYG tax, small business owners get relentlessly screwed by provisional tax, and every single activity from fishing to driving a car to buying a chook has some level of government with their hand in your pocket requiring the payment of some sort of levy, fee, surcharge or tax. and god help you if you don't pay!

in some cases they even have the hide to double dip such as when you buy a car you pay GST, then when you register it you pay based on the purchase price, including GST. it's bullsh1t.

as far as i am concerned all physically abled welfare recipients should be picked up by the government bus and put to work breaking rocks or paving roads or planting trees or digging / filling in holes. there's some encouragement for further education and training right there. government and business crap on about skills shortages and the need for labour so turn to immigration when we have a MASSIVE pool of unemployed no one is tapping.

as for active old people / pension recipients - baskets need to be weaved, phones answered and the next generation minded and educated. be useful or it's dr. nitschke's needle for you!!

 

[Bill M]

The funny thing is, half the people who this sort of stuff appeals to are probably taking their fair share of middle-class welfare anyway.

People are quite happy to engage in this sort of rhetoric until they start losing out, at which point they go to ACA or TT and start complaining about how high the cost of living is and how the government should be doing more to help "working families".

That's exactly right McLovin, I am totally relient on myself, I take nothing from the government other than say my 2 medicals a year through medicare, cost $70. Yet I don't mind my tax paid dollars going to a good cause like supporting those who can't support themselves.

People forget, our current 85 year olds didn't have super and if you were a woman god help you, you were paid less and you couldn't even borrow money from a bank. They worked their guts out putting in for the family and then when society deemed them too old for employment there was only the pension left. Some idiots would like to remove their only means of survival, their pension. I prefer an Australia where we take care of these people, not some backward fascist state.

 

[Judd]

Strange how this thread has drifted to welfare issues as opposed to the original question of financial astuteness.

On that particular subject, I think it has been a gradual thing. Many years ago, it was work, pay bills (if possible) and go on the age pension. Only a lucky few had superannuation and they were, in the main, public service.

So there was no real need to have financial awareness; the Government looked after you.

However, over time, financial risk has been transferred from the Government to the individual. You are a responsible adult so here you go. Sadly, I don't believe that many even understand what was and is happening.

Even before this gradual change, very few were financially savvy and that probably still holds true today. How else can you explain individuals getting involved in financial disasters? (don't start a rant about the "greed" hypothesis)

You can bang on about common sense all you like but what is common sense to me may not be common sense to you. All that form of argument is doing is an attempt to apply your beliefs to another person and you can only do that provided you have fully accounted for their actual beliefs and preferences. A most difficult thing to do and fraught with danger because your own bias will get in the way.

So why aren't the majority financially astute? Maybe it is because their focus is elsewhere: studies, work, family, children, mortgage, the minutia of day-to-day living. A myriad of other things which occupy their existence to the exclusion of planning their financial life.

Be grateful if you not in that group.

 

[Tyler Durden]

Strange how this thread has drifted to welfare issues as opposed to the original question of financial astuteness.

On that particular subject, I think it has been a gradual thing. Many years ago, it was work, pay bills (if possible) and go on the age pension. Only a lucky few had superannuation and they were, in the main, public service.

So there was no real need to have financial awareness; the Government looked after you.

However, over time, financial risk has been transferred from the Government to the individual. You are a responsible adult so here you go. Sadly, I don't believe that many even understand what was and is happening.

Even before this gradual change, very few were financially savvy and that probably still holds true today. How else can you explain individuals getting involved in financial disasters? (don't start a rant about the "greed" hypothesis)

You can bang on about common sense all you like but what is common sense to me may not be common sense to you. All that form of argument is doing is an attempt to apply your beliefs to another person and you can only do that provided you have fully accounted for their actual beliefs and preferences. A most difficult thing to do and fraught with danger because your own bias will get in the way.

So why aren't the majority financially astute? Maybe it is because their focus is elsewhere: studies, work, family, children, mortgage, the minutia of day-to-day living. A myriad of other things which occupy their existence to the exclusion of planning their financial life.

Be grateful if you not in that group.

I agree.

I thought of another example - I remember my friend once telling me he was trying to pay off his credit card, and would achieve that in about 6 months. I suggested he do a balance transfer to a 0% interest credit card, and he said something like "nah, can't be bothered".

I explained to him that it would be much easier to pay off the debt without having interest being added on every month at the exorbitant rates charged by credit card companies, but it went in one ear and out the other.

I just get annoyed that even when you try to help people, they don't see it and don't want to be helped.

 

[Julia]

The funny thing is, half the people who this sort of stuff appeals to are probably taking their fair share of middle-class welfare anyway.

People are quite happy to engage in this sort of rhetoric until they start losing out, at which point they go to ACA or TT and start complaining about how high the cost of living is and how the government should be doing more to help "working families".

True. What's so silly about Joe Hockey's declaration that 'the age of entitlement is over' and that they will be considering pensions etc., is that they are promoting the unreasonably generous maternity leave scheme which will encompass quite well off people, and refusing to means test the private health subsidy.
If they actually have a policy where they will not raise the woefully inadequate Newstart allowance e.g., but persist with their ridiculous maternity payment, I doubt I'll be able to vote for them.

That's exactly right McLovin, I am totally relient on myself, I take nothing from the government other than say my 2 medicals a year through medicare, cost $70. Yet I don't mind my tax paid dollars going to a good cause like supporting those who can't support themselves.

My situation also. Totally agree as regards people who are genuinely disadvantaged, but I worry that benefits are also going to those who are simply lazy and who need to be pushed harder to take some responsibility for themselves.

People forget, our current 85 year olds didn't have super and if you were a woman god help you, you were paid less and you couldn't even borrow money from a bank. They worked their guts out putting in for the family and then when society deemed them too old for employment there was only the pension left.

So true. So many women remained in miserable marriages because there was no sole parent pension.
Now a single mother can decide not to work, yet still put the kid(s) in taxpayer subsidised childcare several days a week! That's simply wrong imo.

Some idiots would like to remove their only means of survival, their pension. I prefer an Australia where we take care of these people, not some backward fascist state.

+1.

Strange how this thread has drifted to welfare issues as opposed to the original question of financial astuteness.

On that particular subject, I think it has been a gradual thing. Many years ago, it was work, pay bills (if possible) and go on the age pension. Only a lucky few had superannuation and they were, in the main, public service.

So there was no real need to have financial awareness; the Government looked after you.

However, over time, financial risk has been transferred from the Government to the individual. You are a responsible adult so here you go. Sadly, I don't believe that many even understand what was and is happening.

So how long are we going to excuse people for "not understanding what's happening"?
There's plenty of publicity about how necessary it is to provide for our own old age.
There has to be a time when we stop making excuses for people.

Even before this gradual change, very few were financially savvy and that probably still holds true today. How else can you explain individuals getting involved in financial disasters? (don't start a rant about the "greed" hypothesis)

OK, fine. Ignore all the admonitions to make provision for retirement. At some stage (probably not that far away) the simple demographics will mean the age pension will be like the Newstart allowance now, e.g. not enough to live on.

People have a choice: make the effort to understand how money works, or have a miserable old age.

 

[Judd]

....I thought of another example - I remember my friend once telling me he was trying to pay off his credit card, and would achieve that in about 6 months. I suggested he do a balance transfer to a 0% interest credit card, and he said something like "nah, can't be bothered".

I explained to him that it would be much easier to pay off the debt without having interest being added on every month at the exorbitant rates charged by credit card companies, but it went in one ear and out the other.

I just get annoyed that even when you try to help people, they don't see it and don't want to be helped.

At least your friend had a plan to get out of debt. True, it may not have been the best one but it was a plan. Hope he succeeded and remains out of debt.

 

[Starcraftmazter]

I fear that when they do take office they may wreak social havoc in the name of getting the finances under control.

I really hope that is precisely what happens. But even more so, I'd love a common sense government that would both tax the miners AND get rid of welfare (or significantly downsize it). Why must we be forced to choose between them

Also, to quote Joe Hockey's speech which I have finally had time to read in full (it is pretty damn massive):

Without a social safety net, Hong Kong offers its citizens a top personal income tax rate of 17% and corporate tax rates of 16.5%. Unemployment is a low 3.4%, inflation 4.7% and the growth rate still respectable at over 4%. Government debt is moderate and although there is still poverty, the family unit is very much intact and social welfare is largely unknown.

That is the ideal Australia must strive for, if it is to be a vibrant and competitive economy.

I just get annoyed that even when you try to help people, they don't see it and don't want to be helped.

Story of my life