What age should the pension be increased to and by when?

[Mooze]

The general feel on here is that most are investing to avoid having to use age pension or super at a set govt age. But from a taxation point of view (country can't really afford it) the below topic is of interest, especially as the country ages. I have specifically not made this a poll as I'd like to hear people's reasonings if they're happy to post them.

Had a bit of a debate with friends who said it should be staying at 65, no changes to super (ie no additional taxation on withdrawl of lump sum etc) - as they were aiming for this in 30 years time. (Bugger putting money in super or investing - they've got to travel as the Joneses went to NZ last christmas so above friends kids shouldn't miss out so they must now go)

Given medical advances etc since introduction of the age pension - when it was first brought in some people might be expected to live a few years of receiving it, the occasional few many years, now people are expecting to live off it for 20 odd years, having drawn a lump sum for their tour of Aus or the world etc.

Personally - I'd like to see it raised to 72 over the next 15 years (rather than simply 67 by 2023), and reviewed beyond that to possibly 75 within the ten years after that. Have super able to start five years prior, but no lump sum withdrawals without heavy taxation. More than enough time for people to top up their super or investments if they wish to retire earlier. (I'm 31).

 

[weg]

Personally - I'd like to see it raised to 72 over the next 15 years (rather than simply 67 by 2023), and reviewed beyond that to possibly 75 within the ten years after that. Have super able to start five years prior, but no lump sum withdrawals without heavy taxation. More than enough time for people to top up their super or investments if they wish to retire earlier. (I'm 31).

If it was raised to 72 or 75 who would employ them after 67 if they became unemployed?

That would force them on the lower Newstart with no prospect of employment, unlike the young on Newstart who can get a job.

What I would like to see is employer paid super prohibited from being withdrawn so this could make up the pension in the first few years.

It amazes me that people can access and spend this prior to going on the pension.

 

[chilliblue]

what i would like to see is employer paid super prohibited from being withdrawn so this could make up the pension in the first few years.

+1







.

 

[Shaneelastic]

Majority of gen x and geny y won't have an issue. The Sgc will provide a comfortable retirement for most.

 

[weg]

Majority of gen x and geny y won't have an issue. The Sgc will provide a comfortable retirement for most.

Agree.

We've discussed balances at work and some are already looking quite healthy in the 200K+ range and they only started getting super late in their working lives.

By retirement they would have a hell of a lot more than those that didn't work much and didn't invest.

A couple of staff that contributed themselves as well are near the 500K mark.

They still have a few years to retirement.

So agree the next generations should not be such a burden providing they have super over a lifetime.

I suspect the biggest burdens will be those that have always been heavily reliant on welfare and the self employed with no super.

 

[pully]

not everyone uses super only, for wealth creation. the constant changes in rules and conditions can be a disincentive.

if the rules change to prevent lump sum pay outs from super that may also be a disincentive to put extra in, why would you? can understand the rationale for wanting to control and limit access to govt welfare. do not doubt other changes will occur to limit access to only those who really need it.

for retirement planning diversification is essential, super is only 1 part. dislike the idea of the govt controlling what can or cannot be done with my funds. we do not see anytime in the future that we would be getting a govt pension, so that part is not on our radar.

good luck to others with their choices.

 

[weg]

if the rules change to prevent lump sum pay outs from super that may also be a disincentive to put extra in, why would you? can understand the rationale for wanting to control and limit access to govt welfare. do not doubt other changes will occur to limit access to only those who really need it.

Absolutely.

I wrote that i thought employer contributed super should be prohibited from being taken as a lump sum. That's what most people have and many have been blowing it on paying off debt, holidays, new cars, etc.

That component is not paid by the employee and should not be used for anything but supporting a person in place of a pension.

Self contributions are an employees funds which is different all together, and should be encouraged... and i'd go as far as saying that i think there should be some schemes in place similar to old pension schemes that are set up so governments can't undo what has been set up (like a contract/policy) enticing Mr. and Mrs. average who are not looking for tax incentives but an easy way to create a retirement fund to do so.

 

[Mooze]

Absolutely.

I wrote that i thought employer contributed super should be prohibited from being taken as a lump sum. That's what most people have and many have been blowing it on paying off debt, holidays, new cars, etc.

That component is not paid by the employee and should not be used for anything but supporting a person in place of a pension.

Agree with this.


In regards to Gen X and Y having enough super - I disagree with this - I used to agree living in Canberra and Sydney, having lived regional where a large number of people have well below average wages and salaries, I'd disagree - a lot of the 40 year olds I know around here would be lucky to have 75k in their super fund - halfway through their working life. Mean time most of the 40 year olds in capital cities are over the 200k mark already.

 

[weg]

Agree with this.


In regards to Gen X and Y having enough super - I disagree with this - I used to agree living in Canberra and Sydney, having lived regional where a large number of people have well below average wages and salaries, I'd disagree - a lot of the 40 year olds I know around here would be lucky to have 75k in their super fund - halfway through their working life. Mean time most of the 40 year olds in capital cities are over the 200k mark already.

Even that is good considering they have another 27 years of work to go... don't you think? That's all some have at retirement now .

Don't forget too, that those very low income 40yo would have started on 3% then 6% and eventually recieved 9%.

In the future it will be 9% then 12%. Over a life time even low income earners will be able to contribute a significant amount towards their retirement pension/income - if not allowed to spend it beforehand - and be much less of a burden than those with nothing.

Like i said, it's those that choose not to work much or those who are self employed and who won't contributed themselves that will be the biggest cost on the economy. I think these make up a large percentage of the population.