Election 2016

[mnewbery]

Perhaps the pilots would glow in the dark yes. Don't forget a sack of Brazil nuts to be sure of making the grade

 

 

[fly_tornado]

Matthew, invest in M61a1's new Oakey spring water plant, Pauline Hanson drinks it every day and she will live to 100

 

 

[dutchroll]

I'll get back to topic. I was extremely amused to see the Libs being turned on a spit over their superannuation policy by their own paymasters. If the IPA and the LNP's regular donors are stridently denouncing a policy, you can be sure it's a good one.

Just goes to show who the real backers of the LNP are (as if we didn't already know). For the life of me though I can't understand why anyone who isn't rich or running a multinational company would vote for them.

I think both parties need to learn that you attack super at your own peril. Super is retirement savings for when people stop working, and whether you have a small super account or a big super account, most people find it equally objectionable to pay substantial tax on it (and they're talking about slugging large super accounts at the top rate). It's particularly annoying when your qualifications apply to a very specialised profession where you'll be compulsorily retired at 63 or thereabouts, yet you may well live until you're 90 these days. If they're serious about not wanting you to be on the pension while simultaneously not qualifying for any pensioner rates or discounts on anything at all, then they need to have a long hard think about restraining themselves from slugging even large super accounts.

 

Not only that, but as soon as they start slugging large super accounts at high rates, I think it's a better than even bet that the threshold for taxing it will creep downwards as successive Governments scramble for revenue. People need to be careful what they wish for.......

 

I pay a lot of income tax and that's fair enough, though I wish they'd spend my contribution more wisely. I don't whinge about it - we all have to contribute if we want roads, medicare etc and high income earners should contribute more than low ones. But I do object in principle to heavy taxes on super, especially when they're expecting you to draw it down (as opposed to living mostly on the interest) over the rest of your lifespan after retirement.

 

 

[jetjr]

Agree, I do think super/pension needs to be considered together including exemptions, tax and allowances.

 

I know of several retirees who spent all their super and savings on a very elaborate house, and still claim pension.....not fair in many eyes.

 

The tax changes they are proposing are removing exemptions which encourage extra investment into super. At worst its the same as you would have paid were it income.

 

A real issue is the seeming constant changing of the system, people make plans based on the rules then they change and there is winners and loosers.

 

 

[Bruce]

Yes I wish they spent mine more wisely too. Is there anywhere in the world where they do spend taxpayer's money wisely?

 

It makes me angry to see some of the more stupid expenditures they make, like excessive CASA policing of recreational aviation.

 

I actually wrote to the new treasurer months ago to say that this expenditure could be cut back,with cheers from the recipients instead of howls.

 

So far no reply. A similar letter to the previous treasurer was ( from the reply) forwarded to CASA for advice, with the result that the expenditure was going to continue. Yet I had told him that we had our own organizations, the RAAus and the GFA, which did little else but look after our safety.

 

 

[dutchroll]

The tax changes they are proposing are removing exemptions which encourage extra investment into super. At worst its the same as you would have paid were it income.

That's the bit which I believe is fundamentally wrong. A lot of people don't realise how quickly super accounts can be drawn down when retirement or forced retirement hits even if the super balance appears very healthy at the time. So as it dwindles and the wonders of modern technology and drugs keep you kicking along seemingly forever, people can get into real strife towards the end of their lives and the whole idea of keeping them off the pension falls apart, then we're back where we started.

 

Extra investment into super should be encouraged, not discouraged. Ok, maybe if your super account is $5 million it's probably over the top but as a high income earner I don't know anyone who has super approaching even 1/4 of that. As for people who blow the lot on a luxury home when they retire, well that's just dumb. Therefore I don't have a problem with counting certain assets in pension means-testing if it's within reason. However it should be balanced against the cost of housing and living where you are. Living anywhere in Sydney for example, the median house price is $700k and it's a bit ridiculous to tell someone they have to sell up and move to Gagebrook in Hobart if they own a $700k property (which would be stratospherically luxurious by Gagebrook standards - they may as well be a multibillionaire) but don't have any super income. Sheesh, move to Gagebrook and get a cheaper house. Why not just send them straight to prison?

 

 

[Marty_d]

I think both parties need to learn that you attack super at your own peril. Super is retirement savings for when people stop working, and whether you have a small super account or a big super account, most people find it equally objectionable to pay substantial tax on it (and they're talking about slugging large super accounts at the top rate). It's particularly annoying when your qualifications apply to a very specialised profession where you'll be compulsorily retired at 63 or thereabouts, yet you may well live until you're 90 these days. If they're serious about not wanting you to be on the pension while simultaneously not qualifying for any pensioner rates or discounts on anything at all, then they need to have a long hard think about restraining themselves from slugging even large super accounts.

Not only that, but as soon as they start slugging large super accounts at high rates, I think it's a better than even bet that the threshold for taxing it will creep downwards as successive Governments scramble for revenue. People need to be careful what they wish for.......

 

I pay a lot of income tax and that's fair enough, though I wish they'd spend my contribution more wisely. I don't whinge about it - we all have to contribute if we want roads, medicare etc and high income earners should contribute more than low ones. But I do object in principle to heavy taxes on super, especially when they're expecting you to draw it down (as opposed to living mostly on the interest) over the rest of your lifespan after retirement.

Fair point, but the intention of superannuation, as you say, is to give you something to live on after retirement that isn't the age pension. It was never intended to be a low-taxed investment option for people who put more money in it than they could possibly need to support themselves at very comfortable levels for the rest of their lives.

 

The big points of the proposed LNP changes are (as I understand it):

 

- $1.6 million cap on the total amount of super that can be transferred into a tax-free retirement account

 

- Reducing the annual cap on concessional contributions to $25,000 and allowing catch up contributions of unused caps over 5 years for balances of $500,000 or less

 

- A $500,000 lifetime cap will be applied to after-tax concessions on super to reduce the capacity for super to be used for wealth accumulation effective immediately and backdated to 2007.

 

These changes don't mean you CAN'T top up your super to stratospheric levels - it just means you don't get a tax break for doing so. If you retire at 63 and live til 100 that's 37 years. If you have 1.6 mil tax free to use over that time, that's $43,243 pa (what's that, around $70k gross if you were paying tax & super on a salary?) on the principal alone. I'm no financial wizard but I'm pretty sure that if you had 1.6 big ones stashed away you'd get a shedload of interest on that.

 

The point is, you're not going to be needing the pension on that. If you've got more than that invested - then why should you get a tax break on it, when someone earning $70,000 is paying 32.5% on anything above $37,000?

 

If I've somehow misread the impact of the changes, feel free to correct me.

 

 

[fly_tornado]

If you have been divorced and your ex took half your super they have also taken half your lifetime cap :/

 

 

[dutchroll]

Yeah marriage breakup is one thing (there are more) which can and often does massively impact the super equation.

 

Now you can make the argument "well you should've stayed with your first one" but it isn't always that simple. I've seen guys who do only have themselves to blame but I've also seen guys who have been knowingly and ruthlessly shafted and who will now work until they physically are booted out of the workforce from necessity, not desire, and who won't have much spare income afterwards by anyone's definition of "adequate"!

 

But the pollies don't think of these or any other factors (eg super fund management, property volatility, interest rates, etc etc) when they attack super. They grab it when it goes in and they grab it when it comes out without so much as a whimsical care in the world about the retiree's circumstances now or in the future.

 

 

[M61A1]

. I'm no financial wizard but I'm pretty sure that if you had 1.6 big ones stashed away you'd get a shedload of interest on that.

You are aware of interest rates of late aren't you? Wouldn't really call it a "shedload" if that's what you've got to live on. Especially if you've worked your arxe off to try and stay off the govt pension.

 

Then if you have to start drawing on it to live, then it's even worse.

 

With long term things like super, it's of no help when you try and build a retirement plan on the rules, and then they go and change the rules halfway through, because they blew the budget.

 

 

[fly_tornado]

The $1.6m goes up $100000 a year

 

 

 

[dutchroll]

That interest Marty will reduce every time you draw it down, which could be every week. Just as you can be surprised how much compounding interest can build up a lump sum, you'll be equally surprised what it does when everything operates in reverse!

 

Throw in a bad decision by your fund manager 3 months before you retire and it's easy to be up sh*t creek without a paddle when you're planning on self funding your retirement (seen it happen). So it's just not so simple to say 20 years before the event "well you'll have one and a half million so you'll be rolling in it!"

 

Yes people retiring on super may end up with much more than the average wage and certainly more than a pension. But they also carry a lot of financial risk. Way more than an employee and way more than a pensioner. That's why I think pollies should be very careful before they stick their hands into it.

 

The $1.6m goes up $100000 a year

Well that depends on a lot of things, doesn't it?

 

 

[fly_tornado]

Super was never designed to be anything more than a replacement for the pension, Howard turned it into a tax dodge and a golden parachute. Taxpayers would be better off just paying the pension and scrapping super as its the largest discretionary item in the budget now.

 

 

[Marty_d]

Comes down to fairness. Just because the superannuant is taking on more risk doesn't mean that there should be no upper limit on the tax breaks. At some point you have to call it what it is... "high class welfare". You may disagree with the LNP on precisely where that point is (jeez, I disagree with them on almost everything else) - but it must exist. If they have extra money they can go put it in blue chip investments or property in Sydney or innovative startups or any other investment they want, and pay tax on it like everyone else.

 

 

[jetjr]

I think maybe risks in self managed super are poorly understood by many going that path

 

If you are sitting in a $700 K house, why shouldnt it be used as funds for your retirement?

 

Otherwise its a form of super gifted to your heirs upon departure.

 

 

[fly_tornado]

There's never been a more exciting time to start selling Oakey spring water...

 

Pauline Hanson takes up Oakey contamination fight

 

 

[Marty_d]

There's never been a more exciting time to start selling Oakey spring water...

Pauline Hanson takes up Oakey contamination fight

What sort of rag is that?? There's a link to another story on the bottom of the page "Woman gives up job to breastfeed boyfriend".

 

 

[fly_tornado]

APN is a dog that Fairfax bought thinking it could consolidate and syndicate news, its for sale if you are interested.

 

 

[M61A1]

What sort of rag is that?? There's a link to another story on the bottom of the page "Woman gives up job to breastfeed boyfriend".

Well, you described it pretty accurately. We get three papers every day at work, that is one of them. The letters page is the best read, someone wrote in the other day (after an article on how to use a roundabout), to tell them that the rules were all wrong, and we should do it differently. The only surprising thing about the region's road toll, is that it is as low as it is.

 

I think maybe risks in self managed super are poorly understood by many going that pathIf you are sitting in a $700 K house, why shouldnt it be used as funds for your retirement?

 

Otherwise its a form of super gifted to your heirs upon departure.

When you consider that a lot of people earn good money and p1ss it against the wall (and I have worked with a lot of them), while others manage their funds better and go and buy a house which increases in value, live frugally and puts money away for retirement. How is it fair that the person with the house is viewed as "wealthy" and the other clown is viewed as "poor old battler", and expects a govt pension for the rest of his days, because "I've paid taxes all my life y'know".

 

I've not met too many genuine battlers, but they call themselves that all the same.

 

 

[storchy neil]

yeh she has been swigging fts water and that's Teflon turnbull sucking your supper I mean super with fairfaxs dog paper making a news neil

 

 

[fly_tornado]

hen you consider that a lot of people earn good money and p1ss it against the wall (and I have worked with a lot of them), while others manage their funds better and go and buy a house which increases in value, live frugally and puts money away for retirement.

Looking around Toowoomba there are hundreds of vacant properties and hundreds more in the building phase, there just aren't enough battlers to rent them.

 

 

[Marty_d]

When you consider that a lot of people earn good money and p1ss it against the wall (and I have worked with a lot of them), while others manage their funds better and go and buy a house which increases in value, live frugally and puts money away for retirement. How is it fair that the person with the house is viewed as "wealthy" and the other clown is viewed as "poor old battler", and expects a govt pension for the rest of his days, because "I've paid taxes all my life y'know".

 

I've not met too many genuine battlers, but they call themselves that all the same.

If we're talking about the 1.6 million cutoff for tax free Super status, then it's not the ones who live frugally and put money away for retirement that are jumping up and down about this - it's the ones who use the Super scheme as a low-tax investment strategy for large amounts of wealth. As I keep saying you can have as many millions as you like in Super - but why should you not pay tax on whatever is over the cutoff?

 

As for the ones who don't put money away - yes there's some who p1ss it away, there's also some that never have it in the first place (if you're at the lower end of the wage scale, you know, the ones who just got the $6 / week pay rise that the Business Council of Australia is complaining so bitterly about - then all your money is going on just living rather than being put aside for retirement). Mind you, "p1ssing it away" is also a valid lifestyle choice - it drives the economy when people spend their money rather than save it. Certainly better for the economy than investing in existing housing stock and artificially increasing house prices.

 

 

[M61A1]

There's never been a more exciting time to start selling Oakey spring water...

Pauline Hanson takes up Oakey contamination fight

When are you putting a claim in for the damage Oakey water has done to your health? Must have affected you somehow FT

 

Mind you, "p1ssing it away" is also a valid lifestyle choice - it drives the economy when people spend their money rather than save it. Certainly better for the economy than investing in existing housing stock and artificially increasing house prices.

While it may be a valid "choice", it doesn't give them the right to demand what they couldn't be arxed saving and complaining that others are better off. If bottleshops, takeaway and medical are the economy, then maybe you're right. (oops, forgot big screen tv suppliers).(oops again...tattoo shops)

 

 

[fly_tornado]

Do you have any concept of how the economy works? Have you wondered why Antonio wants all those refugees in the Toowoomba region? That welfare money they bring with them is pure gold, fills all those empty houses, schools and shops.

 

I can guarantee you people will buy Oakey spring water because they are sick of the nanny state and the government telling them that everything is dangerous and they can't do it.

 

 

[dutchroll]

......the reason we are a nanny state is because there are so many stupid people, and those stupid people invariably cost the community (me, you, everyone else) a lot of money to fix up the crap they cause.

 

When we can cull the stupid people, we will cease being a nanny state.