Superannuation Discussion + market volatility

[Pushka]

Not a loophole - the public expressing their democratic right to spend $ in their early retirement whilst they can still afford and have physical and mental health. Remember the percentage of people who have excess investment assets above the assets test threshold and are independent (self-funded) retirees, is very small. Feel fortunate if you are amongst them, generally due to good planning.

Assets Test thresholds: Age Pension: Assets test thresholds applicable since March 2018

So I’ve rarely seen a mention of mortgages. If the mortgage is on an investment property is that $ owing deducted from the calculation of the asset? And super amount is excluded?

 

[Flying mermaid]

I can understand all of that but what is the equation for how much you factor on nursing home care? How many years? How much per year taking into consideration that costs increase more than CPI?

Personally I don't have a lot of money. If I work until 60 I should have an income of around $55,000-$60,000/year. That should be enough for a comfortable life for our family, including trip(s) back to Thailand.

I'd expect a relatively active life until 75 years of age at which point costs should start to decrease each year even with increase in medical costs.

So that's the plan. But what about nursing home costs? If I start saving these over and above the income mentioned above then I may need to work another 5-10 years. I don't even want to consider that option.

Also with a family income of $60,000 are you eligible for health care card as if you were on pension? That could save some of the medical costs.

I guess we are all different and we all plan differently.

i think you would get the health card with that as a family income, so yes that would be a big help.

I have ignored the whole nursing home issue as well. We are currently pretty fit and healthy for our age (mid 60s), although that can change in a flash.

I suppose at the back of my mind I have viewed our current house as being enough to cover both of us to go into a nursing home, or whatever.

I agree you can’t plan for everything and we are fortunate to have safety nets in Australia. We didn’t retire though until we felt we had enough to cover a reasonable longevity, at the level we wanted to live, but I also think it is better to retire earlier than later. Everyone is different, so I think it is a very personal decision and probably no one can make it except you,

 

[QF WP]

So I’ve rarely seen a mention of mortgages. If the mortgage is on an investment property is that $ owing deducted from the calculation of the asset?

Yes they are, see here: Real estate assets - Australian Government Department of Human Services

"We subtract any loan amount you owe on the property we’re assessing. Your assets test only covers the percentage you actually own."

And super amount is excluded?

Amounts in super once one reaches Age Pension Age are counted towards the Assets Test.

Retirement products held before 31/12/14 are generally concessionally counted on the Incomes Test, those put in place after this date the income is fully counted towards the incomes test.

There are a small number where the assets test amount reduces in a straight line method (certain annuities) but I don't have a lot of time here to discuss. There are also those annuities that are totally excluded from the Assets Test, but they were taken out many many years ago and there are few of them left now and not likely to figure in your situation.

Full description here: 4.9.3.30 Income Test Assessment of Asset-Tested Income Streams | Guide to Social Security Law

 

[lovetravellingoz]

Yes, all of the above. I also don’t want my kids having to support me too much with their time or become my carers. I think that’s an awful waste for the younger person, jmo.

Family history is interesting. Life expectancy is all over the place in my family. Grandpa died at 52 from WWI complications and was ill from that for most of his adult life. His wife life until 92 but was in Nursing Home for several years before that. Their daughter Mum was in robust health until 85 until stroke and then death in Nursing Home 18 months later. On Dads side, Granny died at 87 after a lifetime of rheumatoid arthritis but as a country girl that didn’t stop her being on the roof when we visited her on our honeymoon at the age of 80. Her husband died at 78 from heart issues. Dad died at 74 from cancer. My thoughts - 85 seems the best I can hope for and I will not proceed to a Nursing Home.

Husbands history - all grandparents lived to their 90’s plus a couple of hundreds. His parents - His dad died at 57 from cancer, his mother at 66 from Cancer and he himself had cancer at 22 but obviously recovered.

So for us family history seems completely irrelevant. I’d expect to leave my family something. I intend to take action when the time is right. ‘Still Alice’ movie scared me. I have no family issues to work through unlike the character in that story so figure it’s my choosing. It actually helps with planning.

Yes family history is only a guide.

And also each generation is tending to live longer than the preceding one due to better health care, better knowledge of what is bad for us etc etc.

However there is also now a Catch 22 in this as more and more people are being affected by Alzheimer's before they pass. our bodies can outlast our minds. And like you that concerns me.


One of my grandmothers was an early frequent traveller, but of the Ox and Dray kind. Born at at the turn of last century on Cape York, the daughter of a Gold Prospector, she travelled before she was a teenager by Ox and Dray to the Victorian and Kalgoorlie Goldfields amongst other places on roads that were often little more than tracks before settling in wheat-belt territory in Victoria. No First Cabin, but lots of wide open vistas and amazing tales. She was still playing tennis in her 70's and lived a rich and vibrant life outlasting two husbands before passing on at 96. Her last 6 years though she just faded away due to Alzheimer's from a wild and rich soul to a sad, scared and unhappy lost soul.

 

[Pushka]

Yes family history is only a guide.

And also each generation is tending to live longer than the preceding one due to better health care, better knowledge of what is bad for us etc etc.

However there is also now a Catch 22 in this as more and more people are being affected by Alzheimer's before they pass. our bodies can outlast our minds. And like you that concerns me.


One of my grandmothers was an early frequent traveller, but of the Ox and Dray kind. Born at at the turn of last century on Cape York, the daughter of a Gold Prospector, she travelled before she was a teenager by Ox and Dray to the Victorian and Kalgoorlie Goldfields amongst other places on roads that were often little more than tracks before settling in wheat-belt territory in Victoria. No First Cabin, but lots of wide open vistas and amazing tales. She was still playing tennis in her 70's and lived a rich and vibrant life outlasting two husbands before passing on at 96. Her last 6 years though she just faded away due to Alzheimer's from a wild and rich soul to a sad, scared and unhappy lost soul.

That’s a sad tale. I don’t want that for me.

 

[Flying mermaid]

That’s a sad tale. I don’t want that for me.

At least she had an amazing life until she was 90. I have known a few who started declining badly in their 60s. Carpe Diem I think for our demographic.

Dr FM was working in a geriatric ward at one point and a family brought in their aged parent, who had Alzheimers and severe pneumonia. Dr FM advised against resuscitation if it was needed and the family got very angry with her and asked her how she would feel if it was her mother. Dr FM said I would come back and haunt her if she tries to resuscitate me under those circumstances. We have had the conversation about how I don't want to live with Alzheimers!

By the way Dr FM kindly pointed out a few days ago that I am now classed as a geriatric

 

[JohnK]

I agree you can’t plan for everything and we are fortunate to have safety nets in Australia. We didn’t retire though until we felt we had enough to cover a reasonable longevity, at the level we wanted to live, but I also think it is better to retire earlier than later. Everyone is different, so I think it is a very personal decision and probably no one can make it except you,

I think I have longevity covered. You're right that we can't plan everything and nursing home is definitely one. Medical costs are another.

Let's hope not too much goes wrong.

 

[lovetravellingoz]

That’s a sad tale. I don’t want that for me.

Well the first 90 years were all good.

 

[lovetravellingoz]

. Medical costs ate another.

.

Not sure this was deliberate. however is actually very appropriate as medical costs can be voracious

 

[rogerkambah]

Let's hope not too much goes wrong.

Are you generally a lucky person JohnK?

I tend not to be, so have to cover off as many things as I can, rather than just hoping not too much goes wrong.

One boss I had said to me: It's a good thing that there are two kinds of luck, otherwise you wouldn't have any.

 

[Denali]

Hubby spent a couple of hours with his Super guy today, he meets up 3 or 4 times per year but its happening more often these days.

Apparently "they" have plans for me and my super . I fail to pay attention to my super so Im glad he is.

 

[Flying mermaid]

Hubby spent a couple of hours with his Super guy today, he meets up 3 or 4 times per year but its happening more often these days.

Apparently "they" have plans for me and my super . I fail to pay attention to my super so Im glad he is.

in our family, I am the one who looks after it and Mr FM concentrates on his photography. However hopefully you have enough knowledge of what is going on, in case you have to deal with it in the future? I try and keep Mr FM enough in the loop that he knows my strategies as you never know what can happen.

 

[Pushka]

Well the first 90 years were all good.

Agree. I just don’t want memories of that to be mixed with others. Sadly am still haunted a bit my mums last days. I can’t shake that.

 

[andye]

I have a "what to do.." file on the computer. This includes the various FF accounts

 

[JohnK]

Are you generally a lucky person JohnK?

I tend not to be, so have to cover off as many things as I can, rather than just hoping not too much goes wrong.

One boss I had said to me: It's a good thing that there are two kinds of luck, otherwise you wouldn't have any.

Not known to be a lucky person. Can't plan for everything. I'll try to cover most things and if I fall short then can always work for 6 months or more.

 

[rogerkambah]

I have a "what to do.." file on the computer. This includes the various FF accounts

Yeah its one of those largish jobs we should all do.

 

[Hvr]

I have a "what to do.." file on the computer. This includes the various FF accounts

And can your family access the computer? I.e. do they have the appropriate log on?

 

[andye]

And can your family access the computer? I.e. do they have the appropriate log on?

We are joint everything-computer account, bank account, facebook so no prpblem

 

[Buzzard]

Oh yes. Best advice ever. I’m surprised that loophole hasn’t been slammed shut.

I can't remember who but some politician has already mentioned limiting access to super so that people don't spend it and then go on Centrelink.

 

[JohnK]

Yeah its one of those largish jobs we should all do.

That's not as easy as it sounds. Brother has no interest and wife doesn't know what to do and no interest in learning.