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Superannuation, the ultimate government cash cow?

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kashtrade said:
Get ready for a battle royale over superannuation - Thoughts?
there were plenty of suggestions in both directions...Unions want super increased to 15% with a fast track for women while Winding down super would boost the economy
Click to expand...
I’m 33m for reference for the rest of my post.

The idea that people should get a $20k pension for whatever they've contributed to super I think is very short sighted.

All the back & forth on this topic is crippling to actual citizens retirement planning. Just imagine, recent retirees fretting about whether they should take a lump sum or draw down. It's very favourable to have your super in pension mode and get your income tax free. Younger people actually attempting to plan for retirement, how are we supposed to make significant investments towards our older years when each side of the aisle cannot sit still on policy for more than 1 term?

On balance, I think a higher super guarantee is better in the long run but getting there might be painful in the short term.
 
CBerg said:
I’m 33m for reference for the rest of my post.

The idea that people should get a $20k pension for whatever they've contributed to super I think is very short sighted.

All the back & forth on this topic is crippling to actual citizens retirement planning. Just imagine, recent retirees fretting about whether they should take a lump sum or draw down. It's very favourable to have your super in pension mode and get your income tax free. Younger people actually attempting to plan for retirement, how are we supposed to make significant investments towards our older years when each side of the aisle cannot sit still on policy for more than 1 term?

On balance, I think a higher super guarantee is better in the long run but getting there might be painful in the short term.
Click to expand...
IMO the super system will take a long time to fully mature, at your age 33, I would guess your generation will get to see it at the end of its transformation.
Whether that is better than what there is now, who knows? But it is something that young people should think about a lot, my personal feelings are, adding more than required to super may not be as good as investing any excess outside of super.
Then the funds aren't locked away, and at the mercy of future Government whims.
The big question to ask, is super and your contributions, designed to give you a better retirement? ATM the last election indicated, there isn't a cut a dried answer.
Just my opinion
P.S the thread Superannuation the Government cash cow, has a lot of discussion regarding super.
 
sptrawler said:
adding more than required to super may not be as good as investing any excess outside of super.
Then the funds aren't locked away, and at the mercy of future Government whims.
Click to expand...

Cant agree more.

If your entrepreneurial this could kill the access to any number of opportunities.
While Im at retirement age its been a constant battle as Im self managed.
With enough super to never need the pension banks wont consider it for
development or Business.

If I had it all in accounts and Under my names not the super fund Id have
access to much much more than I can now.
 
I tend to agree that adding more than necessary is a big gamble that not much changes between now & turning 60.

I definitely favour having control over what I do with my assets and invest significantly outside of super but I understand folks who might choose super because of the tax implications.
 
sptrawler said:
IMO the super system will take a long time to fully mature, at your age 33, I would guess your generation will get to see it at the end of its transformation.
Whether that is better than what there is now, who knows? But it is something that young people should think about a lot, my personal feelings are, adding more than required to super may not be as good as investing any excess outside of super.
Then the funds aren't locked away, and at the mercy of future Government whims.
The big question to ask, is super and your contributions, designed to give you a better retirement? ATM the last election indicated, there isn't a cut a dried answer.
Just my opinion
P.S the thread Superannuation the Government cash cow, has a lot of discussion regarding super.
Click to expand...
"Superannuation the government cash cow" has been going extremely well,now for years.Does this forum really need another brilliant thread like that, going off at a tangent yet again? Jeebus Mr.Administrator,what's the point?
 
dyna said:
"Superannuation the government cash cow" has been going extremely well,now for years.Does this forum really need another brilliant thread like that, going off at a tangent yet again? Jeebus Mr.Administrator,what's the point?
Click to expand...
Yes, agree completely.
 
sptrawler said:
The technology is improving very rapidly, the Government needs to introduce a tax on volume to offset the loss in income tax as jobs reduce, or beef up the royalties system.
Click to expand...

You will recall that Brendan Grylls had a crack at that in the 2017 WA state election. The chamber of Minerals & Energy (Mining company lobbying group) spent $2 million on advertising to oust him from office.
https://www.abc.net.au/news/2017-03...der-brendon-grylls-and-his-mining-tax/8367508
I daresay they won't be trying that again.
 
Considering his electorate
Pretty dumb really
After all the good work he did for royalties for the region
Political suicide in one horse towns
Big miners start talking layoffs bingo
Job security big mortgage
Bye bye Brendan
 
kashtrade said:
Get ready for a battle royale over superannuation - Thoughts?
there were plenty of suggestions in both directions...Unions want super increased to 15% with a fast track for women while Winding down super would boost the economy
Click to expand...
Interesting but would what union want, ever arrive? Who will fund?
Just for women - few court cases for discrimination now could be filed by men and the gay couple made by two men . already there is a disparity of skills and ability by giving gender diversity in the forefront. All managers are keen to fulfil the KPI and letting a few women also unhappy because beholders could think, they got the promotion only because of gender bias and no merit. Short time gain for some but long term loss when skills and abilities are denied.
 
At last, even Ross Gittins has the penny drop, I've been saying this since this thread started. The first time Gittins has talked sense IMO. The super compulsory contribution is becoming just another indirect tax on workers IMO. Why low paid workers should have their contributions lifted to 12%, when they are struggling ATM, why the hell not give them a 3% pay rise?
https://www.theage.com.au/business/...-make-you-pay-more-super-20200209-p53z31.html
From the article:
The main reason compulsory super isn’t a particularly good deal for most union members is that when forced to pay super contributions, employers reduce their workers’ pay rises to fit. This has been understood from the outset, but last week’s report from the Grattan Institute convincingly demonstrates its truth.

The second reason is that, by design and above certain limits, super savings reduce workers’ eligibility for the age pension. Treasury and independent analysts have repeatedly discredited the industry’s claims that the present contribution rate is insufficient to provide workers with a reasonably comfortable retirement.

The present legislated plan to raise the contribution rate to 12 per cent represents the industry funds’ gift to the army of ticket-clippers making their living off the super industry. It’s origins lie in the Rudd government yielding to industry fund pressure because it believed the huge cost to the budget would be more than covered by its wonderful new mining tax.

But, as an earlier Grattan report has shown, raising the contribution rate as planned would force many workers to accept a lower-than-otherwise standard of living during their working lives so their living standard in retirement could be higher than they ever were used to when working.

This is the union movement protecting its members’ interests? Sounds to me more like union officials expanding the union institution at the expense of their members – and delivering for the banks’ "retail" super funds while they’re at it.
 
Hiddens and the Gratten institute have made a good case in their submissions to the Treasury's review into the adequacy of current retirement incomes,but I can't see the feds Not going ahead increasing the SG to 10% just after the next election,then up to 12% by 2026. Even former Labor PM Keating seems to be in favour.So that's something.Remember,Paulie's compulsory saving for retirement scheme started off at just 3% and only really got started10 years later at 9%.The present cohort of retirees just haven't had enough time in the super system,so are feeling the full brunt of the limited value in the government pension.If future generations start early enough,take full advantage of gov. co-contributions, spouse contributions, home deposit off-sets,tax tricks(let's not forget them) etc,they should get to that magical $1.6 Mill TBC.Sadly,probably not much can be done now, for those destined to miss out.It's going to be tough for them,no doubt about it.
 
I think 10% is enough.
You don't need to be better off when you retire than when you are working.
When you are saving to buy a house, got kids etc. That is when you really need the money.
 
Knobby22 said:
I think 10% is enough.
You don't need to be better off when you retire than when you are working.
When you are saving to buy a house, got kids etc. That is when you really need the money.
Click to expand...
The other thing is low income earners, don't get much of a tax break on their contributions anyway, so it may be more beneficial to leave theirs at 9% and give them a 3% pay rise.:2twocents
 
At last some commentators are starting to see sense regarding super, they are saying what has been said on ASF for years.

https://www.macrobusiness.com.au/2020/02/forget-superannuation-lift-the-aged-pension/
From the article:
In its submission to Treasury for the Retirement Income Review, Mercer has called for a universal non-means tested Age Pension to be considered in place of raising the superannuation guarantee:
The submission said the universal Age Pension would:

  • Ensure financial decisions made by retirees were not informed by how to best maximise their access to the Age Pension;
  • Provide retirees with greater security of income with the knowledge of longevity protection, leading to a better quality of life;
  • Provide stronger incentives to downsize from the family home, improving housing affordability for younger families; and
  • Enable a simpler, more efficient system with reduced administration costs incurred by the Government from the means-tested Age Pension.
“While the universal Age Pension may not be a viable option in the current political environment, it is a compelling proposition for a simpler, more effective system with a clear objective that delivers stronger long-term retirement outcomes for older Australians,” Knox said.

Jeez at last Hooray.:xyxthumbs
 

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