Superannuation Discussion + market volatility

[NM]

Cynical me says that a lot of those in Treasury are the WFH class not tradies

and members of Government Supper Funds, likely with Defined Benefits agreements. Things the workers can only dream about.

 

[CaptJCool]

and members of Government Supper Funds, likely with Defined Benefits agreements. Things the works can only dream about.

Until 2005

CSS closed in 1990



PSS closed in 2005



So the lifetime contributors (35-40 years) CAN be a hefty superannuation

the politicians (their DB scheme closed in 1994)

Average CSS is around $45,000 pa

PSS even less because there’s lots of people who quit after 10-15 years so they can’t get the “pot of gold” results that lifetime employment could produce

 

[Happy Dude]

Yet the medicare levy remains at 2%....

There is a hidden tax on "self funding retirees" of up to $1500/week when they need aged care.
Nursing home: : the people who pay the most at the ones who are not supported by government. My mother paid $900,000 for nursing home accommodation (refundable accomodation deposit) . - that's is an interest free loan to the facility. At the current commercial interest rates of 6% she is effectively paying approximately $1000 per week. She also pays an additional $403 per day until the annual cap of $35238 and a lifetime cap of $84571 (means test fee). Then there is a daily fee equivalent of 85% of the aged pension which she does not get which is approx $26k/year or $500 per week. All up its about $1500 per week not including means test fee.

If someone does not have the full accomodation deposit then the govt says they can pay the equivalent of 7.6% of accomodation deposit not paid divided by 365.

From October the refundable portion of the accomodation deposit is reduced from 100% to 90%. So if $900,000 was paid, her estate will only get 90% when she dies.

For someone who has zero assets and only has the aged pension, all they have to pay is 85% of the aged pension. Which is provided by the government. Thats fine but we can't say "rich" retirees don't pay....

Really interesting post, thanks. As someone who has only had a brief view of the aged care system from the outside but is likely to be forced to engage soon, this info is utterly frightening. I'm sure a separate thread for aged care discussion would be useful and well patronised.

The thing that startles me the most is the mandate that has been given to AC providers to require large RADs (lets give a private company an interest free loan to do with as they wish!!), then to only have to give 90% of it back, all while charging profitable fees for services provided by notoriously underpaid workers. It's some business model.

 

[Brissy1]

and members of Government Supper Funds, likely with Defined Benefits agreements. Things the works can only dream about.

That gov super pension is not the money for nothing scheme that many people think. Bear in mind in this scheme:

- on pension payout it's taxable income to the recipient (unlike pension phase super coming from the 12%sgl), so not only pay tax but affects eligibility for other benefits which the $100,000pa tax free superannuants get;
- it's in lieu of the 12% sgl, gov doesn't contribute that;
- if you break the TBC because of an artificial deemed valuation, you MUST pay extra penalty tax, no transfer to accumulation account option;
- it reduces, or prevents, having a tax free pension phase super account even though it's a taxable income;
- the employee also contributes 5% (AFTER TAX! so maybe about 7½% of their net) from their salary for their entire career (making it even more difficult to purchase a home).

Many employees particularly younger ones with mortgages, when given the option as some were, elected to exit the scheme. Very telling.

Politicians define benefit scheme (closed/grandfathered) is different.