fergal007 Posted August 20, 2013 Share Posted August 20, 2013 Hi everyone, I noticed the MX in Melbourne last week stated that an "average" person would need $535,000 to retire at the end of their working life in Australia. This amount seems about right with the current cost of living today here, I know I wont be retiring here! my company currently pays about 9k a year into my super, I am 33, do the maths! it does not look good! I know the government are going to bump it up to 12% in the near future, but even at that, the cost of living in in 30-35 years time will be much higher! Do you think the government will privatize the Superfund in the future as the population gets older and the funds dry up? Is it even worth paying into? (I know its compulsory) I don't think it should be. I think its a big scam TBH, like the 401k in the US that many people lost their life savings when the stock market crashes, and there is nobody held accountable! I feel Superannuation is the same wolf in sheep's clothes! Maybe I am over skeptical! In other news, while driving to work today a doctor was being interviewed and i picked up oh him where he referred to prescriptions for "consumers" being 10x the price of what people pay in the UK. I could not believe that patients are now being referred to as consumers! Do you think the healthcare system here will become as bad as the US in years to come? I would love to hear other peoples views on the subjects Link to comment Share on other sites More sharing options...
VERYSTORMY Posted August 20, 2013 Share Posted August 20, 2013 I totally agree. I think there does need to be a system to pay for retirement. But, i dont think this is it. Link to comment Share on other sites More sharing options...
Parley Posted August 20, 2013 Share Posted August 20, 2013 I'm aiming for a million as a lump sum and think the $535,000 seems way too low in my opinion. If you can invest $1M at 5% a year you get $50000 a year interest which should be enough to live comfortably on. It really depends on the lifestyle you want to lead in retirement. And the biggest factor, will you own your own home and be debt free at retirement. But personally I don't think the figure you quoted is enough. Also I think it is crazy to just rely on your employer contributions to Super to get you there. I have always matched my employer contributions. So if they put in 9% I salary sacrifice another 9%. Link to comment Share on other sites More sharing options...
Peach Posted August 20, 2013 Share Posted August 20, 2013 Do you think the government will privatize the Superfund in the future as the population gets older and the funds dry up? Super funds are already private... What kind of retirement are you expecting back in the UK? Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 Super funds are already private... What kind of retirement are you expecting back in the UK? I wont be retiring Peach, I will keep going till the bitter end I love work anyways wouldn't have it any other way, suppose if it gets bad enough, hopefully euthanasia will be legal by then! So who runs the Superfunds so? I thought the government did? please enlighten me! Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 I'm aiming for a million as a lump sum and think the $535,000 seems way too low in my opinion. If you can invest $1M at 5% a year you get $50000 a year interest which should be enough to live comfortably on. It really depends on the lifestyle you want to lead in retirement. And the biggest factor, will you own your own home and be debt free at retirement. But personally I don't think the figure you quoted is enough. Also I think it is crazy to just rely on your employer contributions to Super to get you there. I have always matched my employer contributions. So if they put in 9% I salary sacrifice another 9%. I currently live relativity debt free (10k on a car loan for another 2 years) and don't plan on taking anymore debt after that, I don't own a home yet, but hoping to buy one for cash in the near future back in Europe. I have no kids (well not that I know of yet) LOL!! if i salary sacrificed another 9% I would have to live on SPC beans and cheapo white bread full of nasty preservatives! I live within my means and save half of my monthly income, every month Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 Super funds are already private... What kind of retirement are you expecting back in the UK? UK retirement = Sainsburys home brand baked beans and cheapo white bread full of nasty preservatives! Link to comment Share on other sites More sharing options...
NickyNook Posted August 20, 2013 Share Posted August 20, 2013 Do you think the government will privatize the Superfund in the future as the population gets older and the funds dry up? Is it even worth paying into? (I know its compulsory) I don't think it should be. I think its a big scam TBH, like the 401k in the US that many people lost their life savings when the stock market crashes, and there is nobody held accountable! I feel Superannuation is the same wolf in sheep's clothes! Maybe I am over skeptical! Don't think you understand what super is.. It is money held in an account in your name. It is not held centrally anywhere where the government can get it or 'privatise' it (whatever that means). You can decide how it's invested. You can put it in shares where it's at the mercy of the stock market or - if you don't want the risk you can put it somewhere super safe (like in cash). It's entirely up to you where it's invested - you decide what sort of risk you want to take with your money so YOU are accountable if the stock market crashes and you lose the lot. If your employer continues to put $9k a year into super for you, then (assuming a modest 5% growth) you'll have over $600k in 30 years time. That probably won't be quite enough to retire comfortably - but it's a darn sight better than nothing. Link to comment Share on other sites More sharing options...
NicF Posted August 20, 2013 Share Posted August 20, 2013 I wont be retiring Peach, I will keep going till the bitter end I love work anyways wouldn't have it any other way, suppose if it gets bad enough, hopefully euthanasia will be legal by then! So who runs the Superfunds so? I thought the government did? please enlighten me! No the government doesn't run the super funds. Various companies run them. That's why you can decide whether to transfer your super to your new fund when you move jobs. Or take on a self managed super fund. My OH used to have one with Colonial. We've both now got one with Unisuper. Two completely different companies. Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 Don't think you understand what super is.. It is money held in an account in your name. It is not held centrally anywhere where the government can get it or 'privatise' it (whatever that means). You can decide how it's invested. You can put it in shares where it's at the mercy of the stock market or - if you don't want the risk you can put it somewhere super safe (like in cash). It's entirely up to you where it's invested - you decide what sort of risk you want to take with your money so YOU are accountable if the stock market crashes and you lose the lot. If your employer continues to put $9k a year into super for you, then (assuming a modest 5% growth) you'll have over $600k in 30 years time. That probably won't be quite enough to retire comfortably - but it's a darn sight better than nothing. Cheers NickyNook, I have an Australian Superfund, I have spread it out 3 ways, high, medium and low (i think), maybe I should put it all in low risk? If I was to move back to Europe will they pay my super into my European account? 600k will buy a lot of jamon,cheese and beer in Spain Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 No the government doesn't run the super funds. Various companies run them. That's why you can decide whether to transfer your super to your new fund when you move jobs. Or take on a self managed super fund. My OH used to have one with Colonial. We've both now got one with Unisuper. Two completely different companies. Who are theses company's and who do they answer to? if it all goes **** up, (which it will at some point) Link to comment Share on other sites More sharing options...
Mongrel Posted August 20, 2013 Share Posted August 20, 2013 You'll have to wait till you're 65 first Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 Don't think you understand what super is.. It is money held in an account in your name. It is not held centrally anywhere where the government can get it or 'privatise' it (whatever that means). You can decide how it's invested. You can put it in shares where it's at the mercy of the stock market or - if you don't want the risk you can put it somewhere super safe (like in cash). It's entirely up to you where it's invested - you decide what sort of risk you want to take with your money so YOU are accountable if the stock market crashes and you lose the lot. If your employer continues to put $9k a year into super for you, then (assuming a modest 5% growth) you'll have over $600k in 30 years time. That probably won't be quite enough to retire comfortably - but it's a darn sight better than nothing. Hmmmm looks like the same wolf to me please take a look at the link and inform me on the difference. http://guides.wsj.com/personal-finance/retirement/what-is-a-401k/ Link to comment Share on other sites More sharing options...
NicF Posted August 20, 2013 Share Posted August 20, 2013 Who are theses company's and who do they answer to? if it all goes **** up, (which it will at some point) Colonial are a large insurance company I think. Answerable to shareholders probably. Not sure about Unisuper - I know they provide pensions to Universities and related sectors. The Australian super market is very similar to the UK pensions market. Only difference is that the Australian government make you have a super but the UK government haven't made having a pension fund law yet. Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 You'll have to wait till you're 65 first Knowing my luck I will probably be dead by 65 :mad: Link to comment Share on other sites More sharing options...
starlight7 Posted August 20, 2013 Share Posted August 20, 2013 HESTA aren't bad. I think you would need at least 1,000,000 - that is conservative. Link to comment Share on other sites More sharing options...
fergal007 Posted August 20, 2013 Author Share Posted August 20, 2013 HESTA aren't bad. I think you would need at least 1,000,000 - that is conservative. Jesus, everyone's saying a million bucks! I wont be retiring here, its a million today, two million tomorrow! fair dinkum! Link to comment Share on other sites More sharing options...
NickyNook Posted August 20, 2013 Share Posted August 20, 2013 You'll have to wait till you're 65 first No - if you were born before July 1960, you can access your super at age 55. If you were born after June 1964, you can access your super at age 60. People born in between the dates above can access their super at ages 56-59. Link to comment Share on other sites More sharing options...
Guest Guest26012 Posted August 20, 2013 Share Posted August 20, 2013 No - if you were born before July 1960, you can access your super at age 55.If you were born after June 1964, you can access your super at age 60. People born in between the dates above can access their super at ages 56-59. Good to know! Link to comment Share on other sites More sharing options...
Mongrel Posted August 20, 2013 Share Posted August 20, 2013 No - if you were born before July 1960, you can access your super at age 55.If you were born after June 1964, you can access your super at age 60. People born in between the dates above can access their super at ages 56-59. But you pay tax on it before 60 Link to comment Share on other sites More sharing options...
NickyNook Posted August 20, 2013 Share Posted August 20, 2013 But you pay tax on it before 60 True. You do. But only on some of it (anything over $180k of the taxable component) and the tax rate is a lowish 16.5%. Link to comment Share on other sites More sharing options...
Bobj Posted August 20, 2013 Share Posted August 20, 2013 [h=1]Australia in 10 years time???[/h] Stufftifiknow...But hope to see it in 10 years' time; what with falling R sover tittlemouse on the rocks when fishing, stepping on poisonous snakes etcetera... Been retired 14 years already. And if I knew how good it was then, I would have retired the day I left skule.:yes: Cheers, Bobj. Link to comment Share on other sites More sharing options...
Petals Posted August 20, 2013 Share Posted August 20, 2013 What will be will be, might as well live now not in the future. A lot never make it to retirement. I remember a guy my oh worked with he saved every penny, played the stock market, was on big super anyway and retired early at 58. He was going to have a long retirement playing the stock market. Well unfortunately the big C had other thoughts, went to the doc with what he thought was flu and he had end stage prostate cancer and died. So why worry about it. It depends entirely on the life you want to lead in retirement how much money you need. Personally as I am retired, you might have had ideas about what you were going to do in retirement but unfortunately you forget on thing, we are old in retirement and what we wanted to do many years ago is not what we want to do now. Life is toooooooooooooooo short to worry about long times ahead. Link to comment Share on other sites More sharing options...
Bobj Posted August 20, 2013 Share Posted August 20, 2013 Have seen that quite a few times Petals, people working to the bitter end and karking it in the first few months of retirement.:sad: Cheers, Bobj. Link to comment Share on other sites More sharing options...
Parley Posted August 20, 2013 Share Posted August 20, 2013 I disagree with that view of Petals, I believe you can easily do both. It doesn't take a lot of effort to plan for retirement. If you spend everything and don't plan for retirement you are destined to be fully dependent on the Old Age Pension. All you need to do is set up your Superannuation account (compulsory anyway), start young and if you can salary sacrifice some of your salary to your super. Review your investment mix once a year and that should be it. That way you will have a large sum at retirement. It means the difference between living for 25 years in retirement frugally on the pension or being able to live comfortably with overseas holidays every few years, new car every so often etc. Link to comment Share on other sites More sharing options...
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