Superannuation Discussion + market volatility

All this complexity is amazing
Iirc ( it was aeons ago) all our super contributions ( to our smsf ) came from pre tax company profits and were therefore tax free. The eventual pension receipt is tax free as well as all the capital gains and earnings
It has been an amazing ride and i am fairly sanguine about the fiscal fiend getting a bit back so late in the game

Posted courtesy of airnz wifi
Even though an SMSF there were still the usual taxes listed above that had to be paid. You likely just didn't see them.
 
You are correct pushka , time dims my memory swmbo advises that the company paid 15% tax on the contributions which were some years quite substantial . We could have taken the profits personally, paid top marginal rates and bought a mercedes . As youngsters setting out we were well advised and listened to it.
 
I am one of the, self acknowledged, very fortunate people who were able to make very good use of the 54/11 option. Fifteen very happy years so far. Most of the people of my age group cohort in Customs changed our Super options to the basic 'cash' rate very early on in 2007. We were a large group of people obsessively discussing our Super returns and an early consensus that problems were coming convinced most of us to change our earning option. before the full losses from the GFC materialised. It was surprising and sad to attend CSS/PSS seminars afterwards and hear from a number of people who hadn't realised that the same changes that allowed some years of double digit returns also meant that double digit losses were possible.
 
hear from a number of people who hadn't realised that the same changes that allowed some years of double digit returns also meant that double digit losses were possible.
that's because until around 2000-01, losses were not passed onto members, but they were announced around then that they would.

(I note the income smoothing mentioned sometime earlier, which in effect meant as a member contributor you didn't have the investment risk, until they changed it to pushing the risk to the members)
 
that's because until around 2000-01, losses were not passed onto members, but they were announced around then that they would.

(I note the income smoothing mentioned sometime earlier, which in effect meant as a member contributor you didn't have the investment risk, until they changed it to pushing the risk to the members)
That is true but the changes, which I think happened sometime in the 1990's, had been widely advertised. I thought most members would have been aware that while they offered the chance of better returns they also opened up the possibility of negative outcomes.
 
That is true but the changes, which I think happened sometime in the 1990's, had been widely advertised. I thought most members would have been aware that while they offered the chance of better returns they also opened up the possibility of negative outcomes.
Yea they were well advertised

IMG_6644.jpeg
They did see negative losses in 2002

These snippets
IMG_6642.jpeg
No risk of negative returns

So within 4 years
IMG_6643.jpeg
And removal of complete guaranteed capital But as from 30 June 2003

Resulting in getting slammed in 2008-09
IMG_6646.jpeg
 
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Aren't negative losses profits? I remember hearing a US fund manager on the radio once calling a year of losses 'negative profits'.
Yes
In 2001 and 2002 the profits were 0…
Post automatically merged:

Wow @CaptJCool
Do you have a whole room with library dedicated to superannuation. Impressive
Just kept a few of these statements to track projected results
Boy they were so far off the reality of the final finish - way underestimated
 
Yes
In 2001 and 2002 the profits were 0…
Post automatically merged:


Just kept a few of these statements to track projected results
Boy they were so far off the reality of the final finish - way underestimated
I can remember getting estimates from the CSS on-line calculator in the late 1990's/early 2000's that underestimated my final figures in 2009 by close to 50%. Those years of double digits returns made my retirement pension and lump sum much healthier
 
Yes
In 2001 and 2002 the profits were 0…
Post automatically merged:


Just kept a few of these statements to track projected results
Boy they were so far off the reality of the final finish - way underestimated
Always happy I was with PSS — never needed the lump sum and indexed pension for life far more attractive for me
 
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Will be interesting for anyone long on BHP (I have quite a few, but <10% by value)

BHP lobs offer for Anglo American (The Oz, Paywalled, sorry)

Mining giant BHP has made a takeover bid for $56bn British resources giant Anglo American in what could shape up to be one of the biggest global resources deals this year.

A statement from the London-listed Anglo American said the proposal comprises an all-share offer by BHP, describing it as an “unsolicited, non-binding and highly conditional combination proposal”.

The offer price has not been disclosed but would be preceded by separate demergers by Anglo American of its entire shareholdings in Anglo American Platinum Limited and Kumba Iron Ore Limited to Anglo American shareholders.

The two parts of the proposal would be inter-conditional and need multiple regulatory and other approvals.


AFR (also paywalled)
BHP lobs takeover bid for $56b Anglo American

Shares of Anglo American have fallen 12 per cent over the past 12 months, giving the company a market value of £27 billion. BHP has a market value of about $230 billion.

Anglo American reported a steep fall in profit and lowered its dividend after a slump in key commodities it produces. In recent months, it has written down the value of its De Beers diamond unit by $1.6 billion and dramatically slashed its copper production goals.

The company has also proposed cutting 3700 jobs across its South African platinum operations and took a writedown on its nickel business.
 
I don't dare comment on the pros and cons but for interest/education, in last weekend The Australian (Edit, not The Aust, think was the AFR I'll check) is an article on the proposed>$3m super tax changes:
1. postulate that even most of the affected persons don't think a 30% rate is unfair. Yet even for them...
2. strategies include transfer excess super funds to a company structure; very telling as that is the same proposed headline tax rate 30%
3. the Greens in the senate are saying they will only agree to pass it if the super tax threshold is reduced to $2m from $3m.
 
I don't dare comment on the pros and cons but for interest/education, in last weekend The Australian (Edit, not The Aust, think was the AFR I'll check) is an article on the proposed>$3m super tax changes:
1. postulate that even most of the affected persons don't think a 30% rate is unfair. Yet even for them...
2. strategies include
There’s plenty of time to develop strategies to get around the tax challenge

The actual over $3 million problem is a relic of a time when the system was open ended as far as contributions go and didn’t anticipate speculative property nor share investments that garnered massive windfall profits

Now with contributions capped and excess contributions tax and 30% tax on those above $250,000 pa it’s all hindered the growing of big balances.
Plus then the transfer balance cap

The two big annoyances in the proposed new regime are

1. Unrealised capital gains (where losses if they occur can only be offset against future gains)

2. Calculation of the balance figure st end of year
Defined benefits will be done via the family law calculations which means women will have higher balances at the same age as they live longer and a reducing notional balance over time as age prunes the balance to below $3 million. In any event many of these folk keep paying income tax til the day they die (unlike private sector super who ONLY pay a lot for aged care support)
 

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