Money Magazine July 2017

“Wealth is not about having a lot of money; it’s about having a lot of options.” CHRIS ROCK, ACTOR/COMEDIAN We had some great feedback on last month’s cover story, “Why you only need $275k in super to retire”. The sweet spot to retirement is certainly a soft spot for a lot of our readers. Some feedback was good, such as that from Kerry on Twitter who described it as “a practical approach to retirement”. Others, like Martin on email, were not so positive: “As a hardworking gen Y taxpayer I am aghast at the thought of all my annual taxes going towards older generations who have failed to adequately provide for themselves.” You can read more reader comments below. Good or bad, last month’s issue got us talking about…

Make super a priority As a super junkie, I really enjoyed last month’s cover feature, “Why you only need $275k in super to retire,” taking us through the maths of what a modest super balance can fund in retirement. Even if you feel you are behind, or have not had a chance to build a substantial balance, there is a great case for prioritising super and increasing contributions, no matter your age or work situation. Susan, Vic Burden for gen Y I understand the intent behind the story, but as a hardworking gen Y I am aghast at the thought of all my annual taxes going towards older generations who have failed to adequately provide for themselves, or gamed the system to the point where it is unsustainable. It is…

Unhealthy obsession with real estate As a recently arrived migrant (three years now) and a qualified accountant, I am perplexed to see the Australian obsession with real estate (notwithstanding the irony that despite being a continent with so much land, there exists a housing crisis), and virtually no discussion on equity/managed funds on prime-time television or from the government. Time and again, it has been proven that the best asset class over a long period is equities. The Buffetts and Vanguards of the world became rich investing in businesses. Even in developing countries such as India, the government encourages investment through mutual funds that yield high double-digit returns. These investments in managed funds (equity linked) with a lock-in period of three years lower tax liability in the year of investment,…

ADRIAN RAFTERY Adrian, Mr Taxman, is an associate professor at Deakin University and author. Adrian says: “I always wanted to sip beers, eating lobster on a crystal-clear beach in the Caribbean. However, since super became so tax attractive in recent years, I am staying in Australia. Best country in the world with next to no tax. Utopia!” CATHERINE SHAR-PLES-RUSHBROOKE Catherine is a strategic financial planner and director at Advice Services Australia. Catherine says: “In my dream retirement I am physically, mentally and financially fit enough to enjoy life – spending time with family and friends, travelling and learning new things.” LAURA MENSCHIK Laura is a financial planner and director of WLM Financial Services. Laura says: “It includes continuing to be mentally stimulated, for example in using my skills in volunteering…

What do you think our most popular password is for all those accounts we have online? I guessed incorrectly. I thought we might be marginally original and use our dog's or cat’s name, or our birth date. These are about as secure a wet paper bag. But no, the most popular password for our personal information and key data is 123456. I nearly fell off my chair when I found out. We hear so much about online fraud and the critical role that passwords play in protecting us, yet many people do the equivalent of leaving the keys in the car and the front door open, with a wad of cash in easy view. We all know the problems of myriad passwords. And I do agree that many of the…

For the past decade, Australian electricity consumers have endured continuous price increases, and this year hasn’t been any different with rises between 7% and 20%, depending on which state you’re in, resulting in obvious negative impacts on family budgets and business competitiveness. These July energy price hikes have come off the back of the closure of the Hazelwood power station in Victoria in March, combined with a tripling of wholesale gas prices over the past three years. A perfect storm really, which has resulted in baseload wholesale electricity prices in effect doubling in NSW, Victoria and Queensland since this time last year – a crisis that could have been avoided with better planning and governance. For instance, establishing a domestic gas reserve, which would electricity generated, which is an achievable…