what would you do with 200k cash lotto winning?

[sanj]

That's the mistake people make with super. It's a separate legal entity with its own rules. It's not 'your' money. Similarly, money that you contribute to a trust, say, isn't 'your' money either. You have to play by the rules of trust law.

Super was created to lower the government's costs of providing for people (especially those on lower incomes) in their old age. Try to make it do something else at your peril.

we arent talking legalese here

similarly money in one of my trusts or one of my companies is mine. it isnt technically mine but for all intents and purposes im controlling it

it is the same with super. yes there are additional rules to contend with but ultimately the money is indeed mine. who knows, maybe ive got s different perspective on it because i know some very successful people who do pretty well out of super. ultimately we all need to contribute to it so why not make it work instead of languish? in no way am i suggesting focusing on super at the expense of other vehicles, it will just one day be yet another income stream and i think it's important to have multiple streams.

 

[ok180]

Take responsibility yourself and change how's its invested.

Me I'm 25 I'm not planning on having any super, it will just be a bonus... Therefor mine is in the highest risk...

Whereas my father is over 50 so through the GFC he changed to cash investment and timed it nicely back to growth

Stop complaining and take control of your life.

I have done that, my super is in good order. Go and ask the average person though if they know where their super is invested, the vast majority havent got a clue. The government shouod be protecting people better rather than letting fund managers gamble with it so they can get a bigger cut. In the end the ones who are going to rely on super need the most protection.

 

[ok180]

sounds like you are all no responsibility too

why should the govt decide how we invest our money??

Sanj, your going around in circles!!! I know what to do eith my money, what i keep saying is why should the government decide my future if im clearly capable of handling myself.

 

[alexlee]

we arent talking legalese here

similarly money in one of my trusts or one of my companies is mine. it isnt technically mine but for all intents and purposes im controlling it

it is the same with super. yes there are additional rules to contend with but ultimately the money is indeed mine.

Actually, it's ALL about the legalese. Who controls the money, how the money can be used. Legal entities are created by law. You have greater freedom with money in your own name, than money held in a trust or company, even if you 'control' it. It's all subject to laws and regulations. Your control is always subject to legislative risk.

Better to understand what the legal definition is of 'my' money, because that's what you're subject to.

So what if you think money in your super is 'yours'? If the laws say you can't do something with that money, you can't.

 

[atti]

while we are on the topic of trusts which i have no idea about.

can i ask if its a good entity for someone with what i have to start a trust to built investment properties ? are trust going to borrow money are subject to same conditions as "me" it seems even though i have capital and combined income of over 60k i am struggleing to borrow any more because "part time work" and "300k debt" i dont understand how to get over this hurled of getting more then 1-3-5 IP maxed out on my "me income" but with trust as some books i read would suggest seems to go much further with some investers as young as 25 age -30 building portfolios of 15-20 - 50- 100 properties.. not that i am aiming to get that high but i would be happy to get to 5-10.

my intial goal as a determined 19 year old was to get to 2 by 35 freehold is that abit of a low standard goal ?

 

[Brady]

I have done that, my super is in good order. Go and ask the average person though if they know where their super is invested, the vast majority havent got a clue. The government shouod be protecting people better rather than letting fund managers gamble with it so they can get a bigger cut. In the end the ones who are going to rely on super need the most protection.

The average person also likely doesnt know where the rest of their income has gone.


It's not the governments job to hold people's hand

 

[sanj]

Sanj, your going around in circles!!! I know what to do eith my money, what i keep saying is why should the government decide my future if im clearly capable of handling myself.

Yet youre saying the govt should only allow cash investments for super. Youre the one talking in circles mate.

 

[sanj]

Actually, it's ALL about the legalese. Who controls the money, how the money can be used. Legal entities are created by law. You have greater freedom with money in your own name, than money held in a trust or company, even if you 'control' it. It's all subject to laws and regulations. Your control is always subject to legislative risk.

Better to understand what the legal definition is of 'my' money, because that's what you're subject to.

So what if you think money in your super is 'yours'? If the laws say you can't do something with that money, you can't.

For god sake we arent in a competition over who has read more textbooks. Im well aware of the difference between ownership and control. Ultimately it is all out of the same pot. If I get dividends from my business or my trust I do developments through or if I later on get money from my smsf it is still mine and im the one making the decision what to do (obviously with a hell of a lot less flexibility with super).

Super is just another vehicle, albeit with a lot more restrictions but it suits some people.

 

[ok180]

It's not the governments job to hold people's hand

Agree 100% So let me invest my money the way i want and dont lock it away from me.

 

[ok180]

Yet youre saying the govt should only allow cash investments for super. Youre the one talking in circles mate.

If the government must take 9% from you then they shouldnt be giving it to suits to gamble with. Like i said, go and speak to someone who had a meagre super balance ready to retire pre gfc and see what they think of the governments retirement scheme.

 

[sanj]

Yup I agree. There is too much govt interference in smsf so there should be more. That makes perfect sense

 

[Hoffy]

Agree 100% So let me invest my money the way i want and dont lock it away from me.

But the govt should make everyone else hold their super in cash???

 

[ok180]

But the govt should make everyone else hold their super in cash???

You took that out of context. Learn to ready Hoffy.

For the 5th time, if one can demonstrate they know what they are doing with their money (via a means test) the government shouldnt be holding funds from you until your ready to drop off the perch. If you want to lock extra funds away like that go for but it defies logic to me. And yes, i believe the government shouldnt be letting corpoorations basically gamble with uneducated investors money and taking no responsibilty for it.

 

[baby blue eyes]

If you are in business and receive your income as a sole trader/partnership no super required to be paid.

Be careful with your assets as both Sole trader and partnership are fully exposed to creditors

 

[china]

Be careful with your assets as both Sole trader and partnership are fully exposed to creditors

I have pondered this a lot but have found no solution. I am a sole trader with no family nor dependents. My main assets are my PPOR and cash in the bank, with small holdings in first state super and stockmarket.

I don't see any effective legal means of protecting any of my assets from any predators, employees, litigants. I have thought of trying to keep some overseas bank accounts but I don't think that this is practical nor effective.

 

[Terry_w]

I have pondered this a lot but have found no solution. I am a sole trader with no family nor dependents. My main assets are my PPOR and cash in the bank, with small holdings in first state super and stockmarket.

I don't see any effective legal means of protecting any of my assets from any predators, employees, litigants. I have thought of trying to keep some overseas bank accounts but I don't think that this is practical nor effective.

A pty ltd company for starters. Liability rests with the company, separate from the individual.

Overseas bank accounts would provide no safety as this is property available to creditors.

 

[china]

A pty ltd company for starters. Liability rests with the company, separate from the individual.

Overseas bank accounts would provide no safety as this is property available to creditors.

I used to have PTY LTD but discontinued this for a few reasons.

The main beneficiaries seemed to be:

ASIC: company registration fees annually
accountant: extra fees to lodge a company tax return
government: having to pay nsw state government payroll tax yearly.


Furthermore, the pty ltd did not provide protection as i am the sole director and solo generator of income in my pty, classed as personal services income. Therefore, for any creditor seeking to pursue me, it would be obvious that whatever belonged to me arose from the pty and vice versa.

Hence I have reverted to sole trader for cost savings but feel vulnerable.

 

[Terry_w]

Furthermore, the pty ltd did not provide protection as i am the sole director and solo generator of income in my pty, classed as personal services income. Therefore, for any creditor seeking to pursue me, it would be obvious that whatever belonged to me arose from the pty and vice versa.

This is incorrect.

I am not sure of your situation but there would be a number of strategies you could do to increase asset protection. If you have PSI income then this may be weakened in some aspects but not in all situations.

 

[Ed Barton]

This is incorrect.

I am not sure of your situation but there would be a number of strategies you could do to increase asset protection. If you have PSI income then this may be weakened in some aspects but not in all situations.

That's what I thought. While the ATO might 'see through' a company structure in determining tax, the ability of creditors, people suing etc is far more limited.

Generally, if China operated under a company structure and was paid wages or directors fees or dividends etc then these could generally be safe from creditors, people suing etc. The biggest exception being trading while insolvent.

So simplistically lets asume China has been doing consulting under a company structure successfully for a number of years and had been transferring the profits (via wage/dividends/directors fees etc) to his personal name. He stuffs up (working under his company China P/L) - the complainant will sue China P/L and wind the company up if necessary taking all the assets of China P/L. But his Mosman home, twelve IPs and learjet all held in his name are off limits?

Is this broadly and generally correct?

 

[Peter 14.7]

Just put it in offset account of IP with 300k debt.
Once you find out what you want to do, you can take it if required.

Agree. Lock it away mentally and then think.

Having cash at call is a very big tool to low ball with when the time is right.

Peter