I have had access to and contributed to Super for about 30 years; in the early days because I worked for the government. My father taught me about the rudimentary benefits as he had been paying into it successfully for considerably longer prior to that.
Super rules have provided an opportunity over the years to undertake some extremely effective tax minimization strategies if you put your mind to it. I had a great mentor in Kerry Packer (even though he didn’t know it) once I stopped getting angry about how he paid very little tax legally, yet as a PAYE employee, I theoretically had no similar options.
In the last decade or so, I have treated it as a wonderful low tax environment for building assets for retirement. If you are an employee, you have limited (legal) tax minimization strategies compared to someone who owns a business (pay all business bills and then pay your tax on the remainder).
I have friends who derided me over the years for being involved in Super for all the reasons and more stated in this thread; they will change the rules, you could be dead by 55, you will be too old to use the money, they will take your money, the managers will rip you off, property is better, I want to use the money how I see fit (consume crap), etc, etc. Like others have indicated here, the vast majority are still working and will be for years.
I fortunately learned very early that, sure, they change the rules, but not retrospectively. They provided occasional one-off opportunities to put in huge amounts of cash, allow you to put in $450K over 3 years of ‘undeducted’ amounts of capital into it, enabled you to salary sacrifice up to $100K p.a., etc. There have been many incentives provided and then withdrawn, but when the opportunity was there, anyone who paid the required attention to the rules of the Super system and utilized it to the ‘nth’ degree got the legal tax minimisation benefits from it. And no doubt will into the future.
People don’t plan to fail, they just fail to plan and undertake the required hard yards when necessary. I worked out many years ago how much capital I needed to fund our lifestyle and at what age, took responsibility for the outcome and used an SMSF to effect the required outcome. If you have made plans to be self-sufficient by the time you are ~55 and can get access to your Super, you are fairly bullet-proof job-wise if you don’t feel like continuing as an employee, or would rather just share trade because managing your assets have actually now become your main business. If you have to wait longer than 55, you just need to plan for the gap to be filled with cashflow outside Super.
A low tax environment is great for trading in and compounding your capital more rapidly over the years. I am now teaching my own kids about the benefits and getting them to think long-term about when they want to be generating enough passive income to be self-sufficient and how much they need in today’s money. I don’t want to ever have to rely on the government and I am teaching my kids the same. And like others in this thread, I am here to tell you at 55 you don’t feel too dead and are confident you still have a few months left to travel and spend some money.
My experience is that those that deride Super, who don’t plan and ignore the tax benefits offered, do so at their financial peril.
Super rules have provided an opportunity over the years to undertake some extremely effective tax minimization strategies if you put your mind to it. I had a great mentor in Kerry Packer (even though he didn’t know it) once I stopped getting angry about how he paid very little tax legally, yet as a PAYE employee, I theoretically had no similar options.
In the last decade or so, I have treated it as a wonderful low tax environment for building assets for retirement. If you are an employee, you have limited (legal) tax minimization strategies compared to someone who owns a business (pay all business bills and then pay your tax on the remainder).
I have friends who derided me over the years for being involved in Super for all the reasons and more stated in this thread; they will change the rules, you could be dead by 55, you will be too old to use the money, they will take your money, the managers will rip you off, property is better, I want to use the money how I see fit (consume crap), etc, etc. Like others have indicated here, the vast majority are still working and will be for years.
I fortunately learned very early that, sure, they change the rules, but not retrospectively. They provided occasional one-off opportunities to put in huge amounts of cash, allow you to put in $450K over 3 years of ‘undeducted’ amounts of capital into it, enabled you to salary sacrifice up to $100K p.a., etc. There have been many incentives provided and then withdrawn, but when the opportunity was there, anyone who paid the required attention to the rules of the Super system and utilized it to the ‘nth’ degree got the legal tax minimisation benefits from it. And no doubt will into the future.
People don’t plan to fail, they just fail to plan and undertake the required hard yards when necessary. I worked out many years ago how much capital I needed to fund our lifestyle and at what age, took responsibility for the outcome and used an SMSF to effect the required outcome. If you have made plans to be self-sufficient by the time you are ~55 and can get access to your Super, you are fairly bullet-proof job-wise if you don’t feel like continuing as an employee, or would rather just share trade because managing your assets have actually now become your main business. If you have to wait longer than 55, you just need to plan for the gap to be filled with cashflow outside Super.
A low tax environment is great for trading in and compounding your capital more rapidly over the years. I am now teaching my own kids about the benefits and getting them to think long-term about when they want to be generating enough passive income to be self-sufficient and how much they need in today’s money. I don’t want to ever have to rely on the government and I am teaching my kids the same. And like others in this thread, I am here to tell you at 55 you don’t feel too dead and are confident you still have a few months left to travel and spend some money.
My experience is that those that deride Super, who don’t plan and ignore the tax benefits offered, do so at their financial peril.