Superannuation Help

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brocky05

Hi Everyone

Im 33 years old and really starting to worry about my funds for retirement. At the moments I have 50K in super with Australain Super. I have chosen Australian Sustainable shares and the high growth option. Over the past month or so the shares have lost me $4K. I get sick and tired of swapping and changing investment strategies all the time. Is there a better super fund out there and what should I be investing in the last couple of year I have hardly made any gains at all pretty dismal. I would like a pretty aggressive strategy to boost my super up while im still young so it can compound for the next 30 or so years. Just to get where iam today in super when I was about 23 I cut all insurances to reduce fees etc and I think at 33 yrs of age $50K is quite dismal.
Should I be swapping funds? For retirement I do plan on owing 1 x IP and 1 x PPOR so I guess this will help/supplement my super in retirement if I ever make it......
 
At 33 I just put the money in Super and forgot about it. If you keep watching the numbers it will drive you mad.

At one stage I used to watch my super every month; some months it made a bigger return than my wage sometime it dropped by more than my wage. Over the long term it gained enough that at 60 I am semi retired.

If you keep changing options you will run up fees and may be selling out of an option just before it rises again.
 
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Hello Brocky05

Respectfully, I suggest you are in the prime of your investing life. Every $ you sock away now will repay you when you can no longer, or chose not to, work.

None of us old folk on this forum can accurately predict what the smart investing choice should be. Shares, property, bonds, bullion. Or a mix. Or cash under mattress if you are very very very bearish.

Please get in the habit of saving now. Compound interest is your friend. So is time. Google some early retirement websites. Super may not be the right vehicle.

Just do it my friend and Future Brocky will thank you
 
Sustainable shares & high growth options are both high risk options, quite possibly higher risk than the preferred options for your age group. Constantly changing does not benefit you at all - if you are concerned take advantage of the financial planning service offered by your super fund (this may even be free).

If you aren't contributing extra to your super, there is no chance of it amounting to anything reasonable - a contribution of about 15% of your wage (ie employer contribution + an additional 6% of your own as salary sacrifice) is generally recommended to provide a reasonable standard of living upon retirement - try using one of the calculators available online eg: Cbussuper.com.au has a range of calculators to determine your position upon retirement (assuming no changes between now and 37 years time).
 
Terry_w said:
Shares go up and down, you have to expect that. They are a long term investment.
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So does property but as it takes much longer to transact, the ingoing & outgoing costs are higher and they are traded at a much more infrequent timeframe we don't tend to notice the movements (other than movements to the median).
 
I dont really change that much over the last 10 years I have probably switched 3 or so times im at the point now where I dont really bother with it. Is Australian super though just an ameture super fund. For example is there a fund where you can individually pick which shares you want your super invested in ie CBA shares not just pick shares and they invest it in a mix of what they feel is best and return the %p.a that they feel fit to. Most years as well I have been lucky to get 3%pa returns whats the point.....
 
I empathise, and if its any consolation I'm ten years down the track and at 43 only have $90K in super as I only moved to Australia when I was 26, haven't had great paying jobs, and one employer that just stopped paying the super leading up to his business going broke.

So what to do? My own sentiment is that I won't be able to rely on super so I have to look after myself by accumulating several properties that can provide passive income when I'm old. This means saving and sacrificing now. I basically don't regard super as something I can live off. If I'm still able to draw a lump sum I will probably use to to reduce debt/loans but not to actually live off hopefully.

I shifted my super a few years ago, I check on it probably once a year and compare, but so far have not had to move it again as its doing okay if not brilliantly. Set and forget. Depending on what you are earning you might consider doing a co-contribution and getting the government top up if you are on a lower income. I used to put extra into super when I worked for an employer that also made a top up contribution, but now I prefer to put the extra into offset.

Good luck with whatever you decide to do, you are right to be concerned about super as its only going to be enough to have a very basic retirement. But try not to dwell on it, set and forget, and focus on other strategies so you don't have to rely on super only.
 
Terry_w said:
Shares go up and down, you have to expect that. They are a long term investment.
Click to expand...

Indeed they do - had a client who invested $500k in one mining stock - lost it all, and that was his super.

Great to hear people concerned about their super and thinking about retirement and how much you need to retire.

For me, SMSFs is one way to go - there are tax concessions and a number of strategies to minimise your tax and create wealth over the journey.

If you use a retail / industry fund, look at their returns and strategies and determine if that fund is right or if you want to switch to a better performing funds with more competitive fees.

As I say, I am biased to SMSF.

Cheers, Ivan
 
I had a client in my law practice that invested $1mil of his super in the sharemarket trusting a stranger he met (who was supposedly a share trader) to trade it for him. A few years ago the sharemarket dropped and it went down to $700,000. He then retook control of his shares selling them all and moving the cash to a savings account. A mfew months later the shares jumped again and are probably worth more than $1mil now.
 
Terry_w said:
Shares go up and down, you have to expect that. They are a long term investment.
Click to expand...

Some shares I have went down about $5k over a week then shot back up to where they were in just two days. I think it's kind of fun watching such a roller coaster of prices and the only way I react is to buy more if its really down.
 
I think super is a rort anyway. I probably wont even live to 70 so what is the point. I should be able to take the full 50K now and buy another IP stuff the governemtn and their taxes, how dare they take 50% when its not theirs so annoying.... I only earn 65K a year so im a low wage earner yet I don't qualify for the co contribution in the last year I have started putting $50 a week salary sacrafice. I think I might stop it and just put the $50 a month into my offset account to pay down my mortgage.

I hate how Iam a low wage earner but at the top threshold of a low wage earner so I miss out on the governemtn co contribution. My family also misses out on any family tax benefit from the government because apparently my wage is to good lol what a joke. The other half only works at Woolies and is lucky to pull $400 a week. That is a combined BEFORE TAX income of $86,000 pa no benefits ehich I find sus I have heard of people working in the mines on $100,000pa still receiving family tax benefit.
 
I think super is brilliant, people confuse it for what it is, it a just another structure and not an investment.

You may be one of the few people % who would be better off with the 50k in your pocket now but the vast majority of australians aren't good money managers which is why this is important. On top of that if you don't live til 70 you will be an even smaller % of the population so I don't see how the govt can regulate for that.

People leave money in super blindly and look at it once a year or less, of course it isn't going to do well. What investment would do well with that level of inattention?

Also, 65k is not, at least in any definition I've seen, considered a low income earner.
 
brocky05 said:
I think super is a rort anyway. I probably wont even live to 70 so what is the point. I should be able to take the full 50K now and buy another IP stuff the governemtn and their taxes, how dare they take 50% when its not theirs so annoying.... I only earn 65K a year so im a low wage earner yet I don't qualify for the co contribution in the last year I have started putting $50 a week salary sacrafice. I think I might stop it and just put the $50 a month into my offset account to pay down my mortgage.
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Since when are you losing 50% to the gummint? At best, you might be paying 20% of your total income to paye tax + medicare. Based on the table below, if you earn $180k, you barely hit 30% as your marginal rate of tax - hard to take considering the tax free threshold sits at $18,000


If you want co-contribution, make an after-tax contribution to your wife's super.

What's stopping you getting a higher paid job?

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brocky05 said:
I hate how Iam a low wage earner but at the top threshold of a low wage earner so I miss out on the governemtn co contribution. My family also misses out on any family tax benefit from the government because apparently my wage is to good lol what a joke. The other half only works at Woolies and is lucky to pull $400 a week. That is a combined BEFORE TAX income of $86,000 pa no benefits ehich I find sus I have heard of people working in the mines on $100,000pa still receiving family tax benefit.
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brocky05 said:
Your wife's $400/wk is pretty close to tax free - stop whinging. 2 lots of tax-free thresholds for $86,000 pa income. You're better off than your mate in the mine who has one threshold and pays tax on $72k of his income.

Looking at rough numbers - you/your wife net $73k from your $86k and your mate nets $75k from his $100k - you get $2k less than he does :eek:

You only get family benefit if you have kids, you haven't mentioned any. Part A isn't means tested (AFAIK), part B is tested. See an accountant or go to Centrelink to find out what you can qualify for.
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brocky05 said:
I think super is a rort anyway. I probably wont even live to 70 so what is the point. I should be able to take the full 50K now and buy another IP stuff the governemtn and their taxes, how dare they take 50% when its not theirs so annoying.... I only earn 65K a year so im a low wage earner yet I don't qualify for the co contribution in the last year I have started putting $50 a week salary sacrafice. I think I might stop it and just put the $50 a month into my offset account to pay down my mortgage.

I hate how Iam a low wage earner but at the top threshold of a low wage earner so I miss out on the governemtn co contribution. My family also misses out on any family tax benefit from the government because apparently my wage is to good lol what a joke. The other half only works at Woolies and is lucky to pull $400 a week. That is a combined BEFORE TAX income of $86,000 pa no benefits ehich I find sus I have heard of people working in the mines on $100,000pa still receiving family tax benefit.
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You are not a low wage earner. There are plenty of people out there with full time jobs earning just $37,000 pa before tax. You earn almost double this.

How is the government taking 50%? Super is taxed at a max of 15%.
 
Have one child. We get nothing tax a or tax b which I dont agree with I beleive we are being screwed. Over. With the 50% tax on super didnt explain myself to well I meant if I had to pull it out due to financial hardhsip they tax you 50%..
 
brocky05 said:
I think super is a rort anyway. I probably wont even live to 70 so what is the point. I should be able to take the full 50K now and buy another IP stuff the governemtn and their taxes, how dare they take 50% when its not theirs so annoying.... I only earn 65K a year so im a low wage earner yet I don't qualify for the co contribution in the last year I have started putting $50 a week salary sacrafice. I think I might stop it and just put the $50 a month into my offset account to pay down my mortgage.

I hate how Iam a low wage earner but at the top threshold of a low wage earner so I miss out on the governemtn co contribution. My family also misses out on any family tax benefit from the government because apparently my wage is to good lol what a joke. The other half only works at Woolies and is lucky to pull $400 a week. That is a combined BEFORE TAX income of $86,000 pa no benefits ehich I find sus I have heard of people working in the mines on $100,000pa still receiving family tax benefit.
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You aren't a low income earner. This article should help you put things into perspective. Note particularly the discussion of median income.

http://mattcowgill.wordpress.com/2013/05/13/what-is-the-typical-australians-income-in-2013/
 
- make one last switch to a low-fee balanced or growth index fund then stop fiddling with it and reacting to price swings
- stop insult those on truly low incomes (<$30K) and be thankful for earning a good income
- if a good income is not good enough for you, invest in yourself to improve it
- realise that with great income often comes great work life imbalance - be careful what you wish for
- spend time with your wife and child now - even the healthiest super balance won't correct this later in your life
 
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