(03) 9020 2905It’s official! You don’t care about your super. You’re too stupid to learn. But you shouldn’t have to know anything about it.
Even if that’s untrue, best to take the “Don’t worry, be happy” route, because nobody is prepared to teach you.
So the new plan is … the government will just make super totally moronic. Twitter super.
Sound like a good plan?
Well, no. It’s disturbing rubbish. But this is the basis upon which Jeremy Cooper wants to overhaul Australia’s superannuation system.
Cooper says Australians have a right to be ignorant of their own money. (I think he wants a referendum to enshrine it in the Constitution.)
Don’t believe me? It’s right there in point one, on page one, of Cooper’s report. “Members should not have to be interested, financially literate, or investment experts to get the most out of their super.”
They … WHAT? They shouldn’t have to be interested in their own money? (Super is your money – you just can’t touch it until you’re older.)
Cooper believes that because superannuation is compulsory, you shouldn’t have to be “interested” in it.
Well, super isn’t alone. Other things are compulsory in Australia, including schooling, elections and eating.
Let’s run Cooper’s super logic through some of them.
Education? “Students shouldn’t have to be interested, literate or learning experts to get the most out of their schooling”.
Eating properly? “People shouldn’t have to be interested, nutritionally literate, or sustenance experts to get the most out of their food”.
Compulsory voting? “Voters shouldn’t have to be interested, politically literate or democracy experts to get the most out of their government.”
Despite governments’ best efforts, Australia is full of dummies, fatties and voting abstainers.
But Cooper actually wants to cocoon stupidity. He’d like to encourage you to wrap yourself up in a cozy blanket of ignorance, with a warm glass of don’t care and let you dream about a worry-free retirement.
Let’s get this straight. That’s bollocks.
Cooper’s super will worsen Australia’s retirement incomes. Follow it and you’ll wake aged 65 midway through a fiery nightmare, covered in sweat, wondering how the hell you’ll afford to live until you’re 80.
Okay, enough cracks at Cooper and his stupid super plan.
Australians need their government to educate them about their super. Seeing as they’re not interested, let me do my bit with the rest of this column.
Here’s why you should care about super. And if you still don’t, why you should see a financial adviser about it.
A huge asset: Superannuation will be your biggest or second biggest asset when you retire. But your home won’t produce an income.
Assets determine returns: Holding more shares and property will give you better performance over the long term (10+ years).
Use your youth: Choose the right assets early. If you’re young, choosing more shares and property could double your super by retirement.
Contribute more: Put in extra every now and then. It will add up. The Government will give you tax breaks!
Older Australians: Those over 55 should be on a transition to retirement strategy, or you’re donating extra to the tax office.
Okay, the Queen sends you a card at 100. How about the Australian government send birthday cards every 27 years?
At 27: The card says “Now you’ve been working for a few years, here are the facts about how investment assets perform and why making a small change to your super investments could, potentially, double your retirement nestegg”.
At 54: “Next year, it’s magic pudding time. Start accessing super, salary sacrifice some pay and end up with more money in your pocket AND in super. Magic!”
At 81: “Wow, you’re still alive! Because we helped you with your super, you’ve probably still got plenty. If you don’t, that’s okay. We’ve got a backup called the age pension. It’s not brilliant, but it’ll help get you through.”
Cooper’s super plan attacks super from the complete opposite direction to what it should have.
Memo to Superannuation Minister Chris Bowen: Please throw it out and start again. Give Australians more credit. This proposal is rubbish.”
As that’s unlikely to happen, here’s my message: Paying lower super fees is great. But if you don’t know what you’re doing, a professional could make you far more than lower fees will save you.
Bruce Brammall is the author of Debt Man Walking (www.debtman.com.au) and a licensed financial adviser. bruce@debtman.com.au .