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Superannuation, the ultimate government cash cow?

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divs4ever said:
i am guessing $3 million will not be enough soon assuming you are in solid health
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I agree with you, $3m will be the min required to be self funded for life IMO, there is a reason the Govt picked that number for the recently announced cap.
They didn't just pull it out of a hat.
 
qldfrog said:
I know: it is deadful, was actually looking at going into it as sunsuper got swallowed
Better half uses sell invest..and pretty good returns so far.but I am afraid the next step will be to close existing accounts
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Sorry about that. An additional layer of stress which isn't good.

I was adamant I wasn't going for any self-invest option as it would have defeated the purpose of winding up the SMSF.


sptrawler said:
I agree with you, $3m will be the min required to be self funded for life IMO, there is a reason the Govt picked that number for the recently announced cap.
They didn't just pull it out of a hat.
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Probably. I don't know the actual value of my personal holdings as I'm not into looking at share prices very much. All I know is so far this FY, the holdings have provided me a considerable (by my standards only) cash income with distributions from two ETFs to come. Suffice to say my overall income is a multiple of the full married rate age pension. It is sufficient for me.

PS: Don't forget there is nothing wrong with progressively selling holdings - either in superannuation, personal holdings or a combination of both - in order to fund your retirement. It depends how long you will live (usually an unknown) but at the age of 85 or 95 will you be spending all that much anyway?
 
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Yes, this year is looking a hell of a lot better than 2021-2022, where term deposits were earning 1% and most companies withheld dividends.
 
sptrawler said:
Yes, this year is looking a hell of a lot better than 2021-2022, where term deposits were earning 1% and most companies withheld dividends.
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True but in my case the income was up slightly for 2022FY compared to the previous year due to continually putting funds into the share market via LICs and ETFs. As for cash, I have twelve months of expenditure plus a just in case buffer. I never assume cash will earn much in any case. To do so would be listening to the Siren's enchanting call.
 

Well, maybe not right now. But that is a good point. I definitely plan to travel as much as possible in retirement. I have lived in Canada and Europe, and lived in 3 different states in Australia though I'm only 35. Safe to say that travel and mobility is key for me.

And I'm in solid health, though a bit broken in some ways (just knees/ankle etc). Nothing too serious. I hope to live forever hahaaha.

And I think youre right about the 3mil. But it all changes. It was only a few years ago I thought 1mil was enough. In 10years maybe 4mil will be the goal, lol.
 

I'd be wary of being overwhelmed by negativity. Many posts on this forums, including some of mine in all likelihood, are in that vein.

Countless times over the past 40 years or so I have encountered pronouncements of the Prophets of Doom. If I had taken any notice of them, I doubt I would be in the position I am today.
 
I'm skeptical and cautious, but I'm not a cynic. I won't be retiring for 30yrs so man things can (and will) change in that time. I'm in a far better position for retirement, I think, given I am trying now. Others my age aren't paying attention. I'm not rich and no family wealth, but I won't be struggling in retirement.

I'm very weary of prophets of doom. I typically find it hyperbolic and ideologically driven.
 
I am by nature pessimistic..age and experience did not help there but fighting my nature is a must do, to arrive to balanced decisions.
Investing is first and foremost following if not fronting the herd and jumping off timely.australia has also a unique situation in term of the lucky country cruising past world crisis, and as an import it is very hard to even understand the psyche of Australians.
Which is way I also have a bit of super following the mainstream investment mantra as done by the super funds, not owning a SMSF
 

Yup. Once it is understood investing is one of the most selfish, self-centred things you can do, you can get to the position of not giving a rats about what others do or think you should do. After all, when you go to buy on market, you don't know if it's the sellers last dollar nor do you care. You don't even know who they are.
 
Good plan, all you have to do is stick to it and if your in a relationship get them onboard. Nothing builds a strong relationship better than common goals.
 
Forgot to mention there is at least one critical downside with going with an industry fund. It is the Retirement Income Covenant which came into effect last year. It requires superannuation trustees to develop a retirement income strategy for their members that helps members manage spending of savings through retirement.

I feel a lot of "Get Stuffed" will be be forthcoming with the likely bumph I'll receive attempting to tell me what they think I should do with my superannuation money. Yep, I'm obviously so stupid that I don't know how to handle my assets or income levels to fit my desired lifestyle. It's bloody insulting.
 
Probably just getting ammunition, to apply to the Govt, to bring back minimum and maximum withdrawl limits, as per pre Costello. Then the inflow of contributions will probably exceed the outflow of pensions and take the pressure off them to perform. ?
 
Regulations brought in by the previous government. It is stupid but if they didn't do it, someone would set up a court case for everyone who did something dumb.
 
Knobby22 said:
Regulations brought in by the previous government. It is stupid but if they didn't do it, someone would set up a court case for everyone who did something dumb.
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It's one of those things I'm afraid. A whole bunch of people involved in the various aspects of retirement got together and decided a lot of retired people could live better and be happier by spending more of their retirement funds. It seems reasonable and on the surface it is.

The possible flaw is "OK, say retirees, I'll take the money out as you want but it doesn't mean I have to spend it." Oops. Many probably will but a number will be quite content with their lives and either invest it, which actually defeats the intention, or give it to their kids which is what they would have done anyway.

My spending is likely to be considered horrendously low compared with my income which I have been told is, overall, towards the fifth quantile. Should one of the "whole bunch of people" commence to tell me I could do this or that my response would be along the lines of "Sure but I don't want to or need to."

By the same token, there would be retirees who would benefit with income options. I've no doubt of that.

My irritation with the concept is it is applied it across the board without consideration it may not be necessary for a number who are close to or in retirement.
 
Interesting article on pensions, a good read for those who go on about Australias pensions.

Our retirement age just went up — so why aren't we as angry as the French?

Since Saturday, Australians have been required to wait until the age of 67 until they can get the age pension. It has happened with little protest — a stark contrast to the demonstrations and riots that have rocked France, writes Peter Whiteford.
www.abc.net.au
 
A heads up if people decide to roll over their SMSF to another fund. I was aware of this before any action was commenced but if you are in pension phase when you do it, the maximum amount which can be rolled over is your transfer balance cap. Any excess needs to be withdrawn. An in specie transfer of some holdings to my personal name was done to comply with the TBC requirement. It'll do wonders for my personal income last year with the ETFs involved. As for 2024FY, yeh, it'll definately be higher but given the high level of franking involved across my holdings, I don't think it will be too bad. If it is, tough. I made the decision so I cop the outcome of that decision.

I also wanted to avoid any unlisted products where possible such as infrastructure or property. I was prepared to forego some performance for the 'peace of mind' factor and I am comfortable with the decision to go with the fund's index only approach despite the fixed interest component being too high in my opinion. I've never liked those unlisted products as the actual valuation isn't transparent to me. In the past a couple of industry funds got hammered on re-valuation. I think MTAA was one - I recall it was the 'darling' super fund of some commentators at one point - and it subsequently merged with another fund.

I directed the account-based pension to a bank from which my household costs (rates, maintenance, utilities, all insurances, car rego, internet, running away from home money, etc) are paid. I'll see how it goes as probably every few months I'll transfer an amount out for other purposes or invest it.

It feels as if a weight has been lifted from my shoulders. I feel bloody good as a result.
 
The first monthly payment of my account-based pension of $7k (slightly over the mandatory 5% withdrawal rate) appeared in my nominated bank account on Friday. Absolutely nothing for me to do as those funds will accumulate to cover my fixed household costs when they are due. The level of funds in the account could be viewed as excessive as the initial amount I left in there is $20k but that's my comfort level buffer. I'll review the amount in the account in six months time and probably transfer anything above that buffer to use for other purposes.

I did very well with the SMSF over the years. However, it's hard to describe the feeling the restructuring of my finance arrangements has brought to me. Being able to literally ignore one aspect - and the tedious one of bill paying - is an utter joy.
 
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