Superannuation is a Dud for Young Australians

[sptrawler]

Great topic, and the reason I don't contribute to Super - in my short 23 years of working full time, the "goal posts" have been moved more times than I can count, and bearing in mind I could be working another 40 years I'm sure they will be moved again!

Some people have over $100,000,000 in their SMSF and might be earning $5-10million a year in investment returns and paying 15% tax on that income and they are complaining that it might be increased! If that cash was in their own name they would be paying 45c to the dollar.

Not necessarily - if they are putting the money (for example) into the stock market, the capital gains won't be taxed at all until the shares are sold, and during those years that untaxed return could be re invested at more profit. If they are paying 45% tax, the dividend will already be most likely taxed at 30% - therefore 15% more tax paid - though I do realise the benefit of franking credits.
Somehow I doubt someone with 100 million stashed away for retirement will struggle in retirement, regardless of how much tax they are paying.

Firstly how would someone get $100million in super, with the old RBL's and the new contribution caps?

Secondly why would you bother if you had that sort of money there are less transparent and onerous vehicles to park that sort of money.
I think your blowing wind up my ###, or your talking about someone with dementia, the other option they may have a financial planner.

Talking about financial planners, I love how Michael Pascoe thinks people with $2m in super are fat cats and should be hammered harder.
Why would I pick him as my financial planner? he's meant to make me money?
Doesn't he realise, 10 years ago I could buy a house in Perth for about $140k in a resonable suburb.

Now it will cost $500k, applying the same logics $2m, in house terms is now worth about $600k.

Also not a good advert for the Eureka Report, investment paper, I think he writes for them.LOL

This is the whole problem no one takes into account inflation, 10 years ago $1m was a lot of money, today it's not someone would throw their job in for.

Anyway here's Pascoe's, IMO, silly blurb.
http://www.smh.com.au/business/super-still-gold-for-the-fabulously-wealthy-20130405-2hb5q.html

This from someone who wants to protect your wealth for the next, 30,40 or 50 years.lol

He should probably get a job in the mines.
If he thinks that someone who has sold assets to get $2m in super, makes them fabulously wealthy, what a dick.
Yep, I'd choose him as my financial planner, obviousl $2m is a bling amount to him.lol
My opinions only, but I think people don't think enough on inflation, the forward buying power of your money.

 

[sptrawler]

Sorry I was interupted,

To continue on, most financial planners say you require approx 60% of you final salary in retirement.

Well most fifo workers are on $160k apparently, well to get to get $96k pension(60%) at 5% is approx $2m.

So who is telling the porky's. LOL

It all appears to be 'rope a dope' to me.

Why the reporters aren't demanding the tax be 15% on pensions above $100k, just highlights their ignorance or lack of vision.

 

[stewiejp]

couldn't agree more, hence my reply - the 100 mil figures and tax rates were the previous poster's - I was just replying to them. Should have used the quote thingy.. sorry - late

 

[Vixs]

Sorry I was interupted,

To continue on, most financial planners say you require approx 60% of you final salary in retirement.

Well most fifo workers are on $160k apparently, well to get to get $96k pension(60%) at 5% is approx $2m.

So who is telling the porky's. LOL

It all appears to be 'rope a dope' to me.

Why the reporters aren't demanding the tax be 15% on pensions above $100k, just highlights their ignorance or lack of vision.

You can't take a rule of thumb and apply it to an exceptional circumstance. Most people don't have salaries or day rates inflated for inconvenience and danger pay.

 

[Smurf1976]

I don't understand this argument at all. Think of it from an opportunity cost perspective.

The argument is quite simply that I don't want government deciding when and under what circumstances I can withdraw *my* money.

If I have enough to retire at 55, 58, 60 or whatever then that's exactly what I'll do. Super doesn't allow this, therein lies the problem. I'm not seeking to end up with a huge balance remaining on the day I die.....

 

[sptrawler]

The argument is quite simply that I don't want government deciding when and under what circumstances I can withdraw *my* money.

If I have enough to retire at 55, 58, 60 or whatever then that's exactly what I'll do. Super doesn't allow this, therein lies the problem. I'm not seeking to end up with a huge balance remaining on the day I die.....

Jeez smurph it must come with the territory, I have scrimped and saved all my working life to ensure I'm not beholden to anyone.
I was quite fortunate I did, because I've suffered from really bad arthritis requiring several joint replacements.
What I would say now is people should really think about tax effective investment outside of super.