More super control
I’d just like to make comment on the superannuation issue. I have always believed that there should be other options to manage your own superannuation funds, along with the ability to choose your own fund (and not your employer – thank god that rule changed!). It took me ages to piece mine together as I was a casual of about three or four businesses, then long-term with two more before I got the chance to consolidate my super. Phew!
But I’m now trying to manage my super better than before. I have found that unless you take a firm approach with your fund’s advisor they bung your money into whatever they think is good value or blue-chip. I would like to have the time to be more proactive and choose my own investments better, but being a novice at the SMSF I’m a bit nervous about that.
I would really like to have the ability or option to have the superannuation offset my mortgage as I believe that as an absolute return on investment your money is totally safe and as a compound interest saver this would give me even better returns (or am I flawed in this thinking?).
Other than the simple benefit of reduced cost of living over the life of the mortgage, it also gives the balance of equity in the mortgage greater value overall, allowing for other investment opportunities utilising that equity.
If the super is sitting under your own bricks and mortar I would feel much more secure financially than having it being gambled by the stock market jockeys of the super funds.
Myopic super strategies
Your article on the abysmal performance of the superannuation industry I believe only touches the tip of iceberg.
There’s something deeply wrong with the industry and its attitude when an amateur investor like myself buying on value principals can beat the market, and yet these highly paid and supposed experts get it so wrong. Apart from the bias to equities there is the mind bogglingly stupidity of the Future Fund to balance its investments by selling Telstra, not only losing value but income (and presumably they reinvested to ‘balance’ their portfolio in such stellar performers as the mining and retail sector further losing investors’ money). If I was a federal public service I would be outraged at this strategy and attitude. They may as well buy an index fund and further reduce fees.
The other point of concern is that there is a real risk of over-investing in Australia as European funds have done in Europe and are now paying dearly for not diversifying. This increases risk for those who don’t know foreign markets but surely to truly diversify, and take advantage of a high dollar and the low PEs of international markets, super funds should move past their myopic equities bias and parochial investing.
More needs to be made of this abuse of peoples retirement funds.
Comfort from cars
I have only ever bought one new car (a 63 VW Beetle) and bought it tax free in Germany. After driving all over Europe for a year I shipped it home with no duty or tax as I had owned it by arrival for a year.
Since then, whenever I have needed a car (about every four-six years) I go to the auctions and pick one up, usually a government owned car (they are cheaper because government hasn’t paid tax on them and as well usually has not spared the maintenance – often they are barely run in with sometimes only 25km on the clock).
Until I read Scott Francis’ article I did not realise why I am now comfortable.
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