Superannuation Discussion + market volatility

[QF WP]

I will need to check that with him - he did have a valid one but there have been some changes since Christmas- I might ask him to change it to my address.

A very wise idea - once mail has been returned twice the super fund must advise the ATO.

Wasn’t there something with inactive accounts of less than x dollars being swept away from the funds and into the “care” of the government?

Yes, my recollection is a bit sketchy on details at present - both because I’m overseas on holidays plus I never let my clients get into such a position

 

[Cossie]

A slightly different question, the boss has retired and her previous advisor has retired as well so we took the oportunity to close that super account and open one with Aus super, that's where my private one is as well, so we did this to tidy things up.
Anyway, her money from the old account was rolled over into the new one, interestingly enough there is a difference of several thousand dollars from what was meant to have been rolled over and what is now in the new fund.
Is this normal? Would it be worth questioning this or would I be correct in asuming that the difference has gone in 'fees' somewhere?

Thanks for the replies, it looks like my mistake (why am I not surprised!), one number was the 'estimated' amount, not the actual final amount, so what was in the closed account went over to the new one.

 

[Buzzard]

An example of a 70%/30% growth/defensive "market benchmark" fund would be the Vanguard Diversified Growth Fund which presently allocates to Aus large caps (28%), Aus small caps (5%), international shares (33% hedged and unhedged), emerging markets (4%), international bonds (21%) and Aus bonds (9%). Relative to that, your allocation would be underweight international shares (and by default, US which makes up 60% of the international shares index), emerging markets, Aus small caps and bonds (significantly); and overweight Aus large caps and cash (significantly). No right or wrong answer here.

A competent financial advisor would take into account your assets outside super (how correlated are their performance relative to the asset classes above), your risk tolerance, access to super, etc. For example, all the following factors would impact how I invest my super: a large cash balance outside super; a business dependent on the US economy; $300k worth of NAB and BHP shares; two investment properties; me being able to access super in 5 years vs 15 years.

I like Vanguard myself. I hold VDGR .

 

[exceladdict]

Saw this interesting article today (based on a lecture a few months ago) about withdrawing from (or going to) any particular sector, and it not being as perilous as I would've thought: The mythical peril of divesting from fossil fuels - Grantham Research Institute on climate change and the environment

... there is no advantage to an investor of choosing the high-growth information technology sector over, say, utilities. Utilities are priced down and information technology is priced up, but they produce the same returns. It is amazing....It means that if investors take out fossil fuel companies from their portfolios...[the] starting assumption should be until proven otherwise that it will have very little effect and is just as likely to be positive by 17 basis points as negative.... That is an amazing contradiction to what every investment committee has ever said, as far as I am concerned.

 

[JohnK]

Saw an article this week regarding superannuation accounts with the major banks. The top superannuation product offered by each of the banks has returned 3.1% in the past 10 years where as the no risk cash rate has been 3.8%.

Anyone see the article?

 

[Buzzard]

Didn't see the article nut it seems like the banks super should have just bought shares in said bank

 

[andye]

Saw an article this week regarding superannuation accounts with the major banks. The top superannuation product offered by each of the banks has returned 3.1% in the past 10 years where as the no risk cash rate has been 3.8%.

Anyone see the article?

If so that's as big a scandal as any in the Royal Commission

 

[Freq Flier 2013]

Didn't see the article nut it seems like the banks super should have just bought shares in said bank

Bought bank shares through the superfund of course

 

[rogerkambah]

Just like some clarification on the treatment of post tax contributions to superannuation for 2018 and ongoing years.
I understand that the ATO has changed the rules to enable employees to claim a tax deduction on post tax contributions to superannuation for 2018.
I understand there is a requirement to complete a form NAT71121 and send to the super fund.
Will the ATO refund the marginal rate of tax paid on those contributions and the super fund then deduct 15% of the contributions paid as tax, or;
Will the ATO refund the marginal rate of tax paid minus 15% contributions tax.

 

[QF WP]

@rogerkambah, yes the ATO firm must be lodged with the super fund - within various time constraints.

Once lodged and processed by the super fund, it is then obligated to remit 15% contributions tax to the ATO.

The person will then be required to lodge their tax return and claim the tax deduction, thus reducing their taxable income on which they pay tax.

 

[Pushka]

We’ve stopped drawing down from our Suoer Fund as new rules don’t make it worthwhile to do so. We will still salary sacrifice as much as we can to keep topping it up. We are a few years of being 65.

 

[cove]

Hoping to get about $50,000 in a tax refund to our SMSF this year from franking credits. The alternative government wants to grab those credits and spend them.

 

[Pushka]

Hoping to get about $50,000 in a tax refund to our SMSF this year from franking credits. The alternative government wants to grab those credits and spend them.

To think I was almost tinkering with voting for them because I was angry with Turnbull limiting pre tax contributions to 25k.

 

[tgh]

The franking credits are looking a little less in peril as Shorten is increasingly seen as a grub and Albanese is seen as electable.
Albo could dump this unpopular tax and earn a heap of brownie points

 

[Pushka]

The franking credits are looking a little less in peril as Shorten is increasingly seen as a grub and Albanese is seen as electable.
Albo could dump this unpopular tax and earn a heap of brownie points

I think Turnbull is dead scared Labor will dump him before he gets the chance to announce the next election. If Labor lose that seat then a new election will be announced very rapidly. I like Albanese. I’m not a Turnbull fan but compared with Shorten, well, no brainer.

 

[Flying mermaid]

I actually liked Shorten initially, but yeah - bit of a sleaze bag. Wouldn’t trust anything he says tbh and I think this class war thing he’s got going is quite harmful.

 

[tgh]

I actually liked Shorten initially, but yeah - bit of a sleaze bag. Wouldn’t trust anything he says tbh and I think this class war thing he’s got going is quite harmful.

Drifting a bit , but it passes my mind that Shorten is the test dummy for the current class war spin.
If/when it has bombed they may take the opportunity for a fresh face, the byes add some inertia so he is looking very shaky indeed atm.

 

[JessicaTam]

[mod hat]
Just a reminder that this is a thread for superannuation discussion.

Please limit political comments to the topic at hand.
[/mod hat]

 

[cove]

Changing the tax treatment of franked dividends could mean an exodus of funds from Australia to the rest of the world. I don’t see that as a good plan.

 

[burmans]

Changing the tax treatment of franked dividends could mean an exodus of funds from Australia to the rest of the world. I don’t see that as a good plan.

Apart from a general mistrust of things not Australian, not really sure why you'd say that. If you'd invested in the "rest of the world" over the last few years you'd almost certainly have done better than investing in Australia. So not good for who?