Superannuation/Salary Sacrifice

[kriles76]

Anyone throw extra money into their Super?

If so has it been worthwhile as opposed to other investment options etc etc

Yes. I salary sacrifice as much as I can into my SMSF while staying below the concessional contributions cap.

I’d much rather pay 15% tax on my salary as super contributions than pay the marginal tax rate on taxable income.

As for the second question, it’s hard to say. Super is a conservative investment approach, but my wife and I have grown the balance of our SMSF by 250% since it’s inception in May 2012. We also purchased an industrial property for her business to operate from so the asset mix is property heavy compared to most funds. While the property hasn’t appreciated significantly in value, the income yield has been reasonable; and it’s allowed her to operate her business while it pays rent to our fund. The current asset mix is 55/35/10 shares/property/cash.

 

[Happy Mastenator]

Yes. I salary sacrifice as much as I can into my SMSF while staying below the concessional contributions cap.

I’d much rather pay 15% tax on my salary as super contributions than pay the marginal tax rate on taxable income.

As for the second question, it’s hard to say. Super is a conservative investment approach, but my wife and I have grown the balance of our SMSF by 250% since it’s inception in May 2012. We also purchased an industrial property for her business to operate from so the asset mix is property heavy compared to most funds. While the property hasn’t appreciated significantly in value, the income yield has been reasonable; and it’s allowed her to operate her business while it pays rent to our fund. The current asset mix is 55/35/10 shares/property/cash.

This doesn't say much (and i mean this nicely). Has the amount you put into the SMSF increased by 250%, or has that amount, plus your contributions since then increased by 250%?

For example my Super (in an Industry Fund) has gone up 650% since 2012 (a lot of that is driven by contributions as well). The ASX itself has only gone up from ~4,000 to ~7,000 (approx 170% increase).

The one thing I'd recommend to young players, is that if you're in a position when you are starting your career out where you can live without a couple of percentage points of your salary consider whether you can funnel it into salary sacrifice. I wouldn't want to do so if it would impinge unduly on your ability to save for a property, but if it is ultimately just a little less drinking money that you'd blow (this is my regret), putting it into super in your 20's will pay off long term.

Super goes through exponential growth, so the more you put in earlier the more bang you'll have at retirement.

Here's how my super balance has changed over the last 10 years (noting that my salary has gone up approx. 270% over this time (basically my 30's which is where you'd expect to see your salary jump the most).




You can already start to see the curve impacting as per the typical balance (as per chart below). What stands out though, is the more you can get in earlier, the quicker you can get to the bigger growth phase.

What really drives your super balance?

Understanding what drives the growth of your super balance over time can be helpful when reviewing your investment strategy.

qsuper.qld.gov.au

 

[kriles76]

This doesn't say much (and i mean this nicely). Has the amount you put into the SMSF increased by 250%, or has that amount, plus your contributions since then increased by 250%?

For example my Super (in an Industry Fund) has gone up 650% since 2012 (a lot of that is driven by contributions as well). The ASX itself has only gone up from ~4,000 to ~7,000 (approx 170% increase).

The one thing I'd recommend to young players, is that if you're in a position when you are starting your career out where you can live without a couple of percentage points of your salary consider whether you can funnel it into salary sacrifice. I wouldn't want to do so if it would impinge unduly on your ability to save for a property, but if it is ultimately just a little less drinking money that you'd blow (this is my regret), putting it into super in your 20's will pay off long term.

Super goes through exponential growth, so the more you put in earlier the more bang you'll have at retirement.

Here's how my super balance has changed over the last 10 years (noting that my salary has gone up approx. 270% over this time (basically my 30's which is where you'd expect to see your salary jump the most).


View attachment 1470909

You can already start to see the curve impacting as per the typical balance (as per chart below). What stands out though, is the more you can get in earlier, the quicker you can get to the bigger growth phase.

What really drives your super balance?

Understanding what drives the growth of your super balance over time can be helpful when reviewing your investment strategy.

qsuper.qld.gov.au

You’ve done well.

I agree with your comments about contributions when you are young - those dollars provide you the greatest ROI over time.

 

[Happy Mastenator]

You’ve done well.

I agree with your comments about contributions when you are young - those dollars provide you the greatest ROI over time.

I’ve been fortunate to have good paying jobs. That helps a lot given haven’t contributed an extra cent myself.

Sadly do have a lot of work to do to pay the mortgage off…

 

[PT Bar None]

Yes. I salary sacrifice as much as I can into my SMSF while staying below the concessional contributions cap.

I’d much rather pay 15% tax on my salary as super contributions than pay the marginal tax rate on taxable income.

As for the second question, it’s hard to say. Super is a conservative investment approach, but my wife and I have grown the balance of our SMSF by 250% since it’s inception in May 2012. We also purchased an industrial property for her business to operate from so the asset mix is property heavy compared to most funds. While the property hasn’t appreciated significantly in value, the income yield has been reasonable; and it’s allowed her to operate her business while it pays rent to our fund. The current asset mix is 55/35/10 shares/property/cash.

How do you find managing your own super fund?

I think I remember reading somewhere that the same reporting regulations are applied to self managed funds as are applied to commercial funds. Do you find complying with the regulatory requirements of SMSF to be overly onerous or complicated? Do you have an accountant help you with it?

Thanks

 

[kriles76]

How do you find managing your own super fund?

I think I remember reading somewhere that the same reporting regulations are applied to self managed funds as are applied to commercial funds. Do you find complying with the regulatory requirements of SMSF to be overly onerous or complicated? Do you have an accountant help you with it?

Thanks

How do I find it? Liberating in many respects, but it does require some ongoing bookkeeping, organisation and attention to detail. It's fortunate that I don't mind all that. It's not for everyone.

We only went down the SMSF path because my wife - on a whim - decided to start up a small business. She required a premises to operate from that wasn't our house. We decided to buy a commercial property to lease to the business. We didn't quite have the cash sitting around to do that at the time, so creating a SMSF to buy the property was the most pragmatic solution at the time. We rolled over our industry funds, tipped in a bit of cash into the fund and we were up and running.

The property generates rental income with GST applied, which requires a quarterly BAS to be submitted to the ATO. Our accountant does that. But I need to do some basic bookkeeping such as compiling cash flow statements and keeping statements, receipts and invoices. That's probably 1-2 hours work per quarter on my part. None of that would be necessary if we were just invested in shares/ETFs.

Each year, the accountant must prepare a tax return and financial statement. That's probably about 3-5 hours work on my part compiling all the receipts, invoices, share statements, bank statements etc.,

The financial statement is then audited by a third party to ensure that the fund is complying.

The annual costs of accountants and auditing is about 0.35-0.4% of fund worth in our case. The property inflates our management fees.

There are alternative platforms which are significantly cheaper and less onerous if you want to solely invest in shares, gold, ETF's, crypto or other tradable equities. They'll do all the accounts and auditing; and annual costs are in the $0.5k to $2.0k range.

I wouldn't recommend somebody consider a SMSF unless they have at least $200k as the MER will likely be more than an industry fund. If not for the commercial property, I'd likely still be in an industry fund. I could vent a lot about industry funds, but they're okay for the majority of the population.

I wouldn't waste a cent on retail funds given the high management fees. There's some noise about Vanguard opening a superannuation vehicle which I find very interesting. Being a big believer in passive investment (low MERs) vs. active investment (higher management fees), I would be all over something like that in a heartbeat if not for the property we own - disclosure: my SMSF has ownership in several Vanguard ETF's.

 

[PT Bar None]

How do I find it? Liberating in many respects, but it does require some ongoing bookkeeping, organisation and attention to detail. It's fortunate that I don't mind all that. It's not for everyone.

We only went down the SMSF path because my wife - on a whim - decided to start up a small business. She required a premises to operate from that wasn't our house. We decided to buy a commercial property to lease to the business. We didn't quite have the cash sitting around to do that at the time, so creating a SMSF to buy the property was the most pragmatic solution at the time. We rolled over our industry funds, tipped in a bit of cash into the fund and we were up and running.

The property generates rental income with GST applied, which requires a quarterly BAS to be submitted to the ATO. Our accountant does that. But I need to do some basic bookkeeping such as compiling cash flow statements and keeping statements, receipts and invoices. That's probably 1-2 hours work per quarter on my part. None of that would be necessary if we were just invested in shares/ETFs.

Each year, the accountant must prepare a tax return and financial statement. That's probably about 3-5 hours work on my part compiling all the receipts, invoices, share statements, bank statements etc.,

The financial statement is then audited by a third party to ensure that the fund is complying.

The annual costs of accountants and auditing is about 0.35-0.4% of fund worth in our case. The property inflates our management fees.

There are alternative platforms which are significantly cheaper and less onerous if you want to solely invest in shares, gold, ETF's, crypto or other tradable equities. They'll do all the accounts and auditing; and annual costs are in the $0.5k to $2.0k range.

I wouldn't recommend somebody consider a SMSF unless they have at least $200k as the MER will likely be more than an industry fund. If not for the commercial property, I'd likely still be in an industry fund. I could vent a lot about industry funds, but they're okay for the majority of the population.

I wouldn't waste a cent on retail funds given the high management fees. There's some noise about Vanguard opening a superannuation vehicle which I find very interesting. Being a big believer in passive investment (low MERs) vs. active investment (higher management fees), I would be all over something like that in a heartbeat if not for the property we own - disclosure: my SMSF has ownership in several Vanguard ETF's.

Thanks heaps for taking the time to write up this fantastic and detailed reply!

Appreciate it. Really great info.

Cheers

(Yes, I too have low fee Vanguard ETFs in my portfolio, and also prefer the passive investment approach)

 

[Happy Mastenator]

It’s hard to go past ETF’s. Outside of super my wife and I have vanguard etfs, plus have an account for each of my children. They get $100 a month into that, plus Nona pays $250 each Christmas and each birthday which goes in. They are young at moment but when get older will explain to them and show them what’s happening.

 

[sabre_ac]

It’s hard to go past ETF’s. Outside of super my wife and I have vanguard etfs, plus have an account for each of my children. They get $100 a month into that, plus Nona pays $250 each Christmas and each birthday which goes in. They are young at moment but when get older will explain to them and show them what’s happening.

I'm a big fan of EFTs as well.

Though part of me wonders what happens to EFT returns when the vast majority of money is in them, isn't a fundamental part of returns scarcity and future demand?

Also, EFT's are usually secondary markets (post a company going public), again when most money is flowing to EFTs in a secondary market, wouldn't that imply that future growth will be limited?

All very theoretical and I could be way off.

I was listening to one of my usual financial podcasts the other day and was surprised how long it takes some of those funds that seed startups to generate a return, if ever.

 

[Happy Mastenator]

I'm a big fan of EFTs as well.

Though part of me wonders what happens to EFT returns when the vast majority of money is in them, isn't a fundamental part of returns scarcity and future demand?

Also, EFT's are usually secondary markets (post a company going public), again when most money is flowing to EFTs in a secondary market, wouldn't that imply that future growth will be limited?

All very theoretical and I could be way off.

I was listening to one of my usual financial podcasts the other day and was surprised how long it takes some of those funds that seed startups to generate a return, if ever.

ETF's are just going to track the broader market. So if money goes in, the value will go up as they buy shares in the various companies that are included in the ETF, driving the value of those companies shares up in the meantime.

I guess theoretically that the growth could be limited, but only in the sense that the sharemarket itself stops growing. It's a catch 22 in that though, ETFs would have to stop pumping money in for that to happen. It's like Super in that regard, there is a natural growth that will occur over the long term in the ASX because each month 10% of peoples salaries is getting pumped into it. THere might be downturns as various funds rip money out and convert to cash, but at some stage the money will go back into it.

That's why investing in shares is a long term game, and best done through ETFs. If you want to trade the market then you risk volatility, potentially better short term returns but also greater risk. That's fine if you think you can beat the market. Not many can though, especially unsophisticated investors, like I'd consider myself.

 

[Nothing]

For those who are currently in passive funds, some info to consider:

Product Type	APIR Code	Asset Class/Type	Subsector	Return % (1 Year) (Cumulative)	Return % (3 Year) (Annualized)	Return % (5 Year) (Annualized)	Return % (10 Year) (Annualized)
Managed Fund		Australian Equity	Large Cap - Core	-2.49%	7.84%	9.13%	10.85%
Managed Fund		Australian Equity	Large Cap - Value	5.68%	3.11%	6.40%	10.84%
Managed Fund		Australian Equity	Large Cap - Core	-6.89%	4.45%	7.13%	9.76%
Managed Fund		Australian Equity	Large Cap - Value	8.21%	3.72%	5.65%	9.57%
Managed Fund		Australian Equity	Large Cap - Value	-3.49%	6.44%	6.87%	9.01%
Managed Fund		Australian Equity	Large Cap - Core	0.00%	4.33%	6.99%	8.94%
VAS	VAS	Australian Equity	Large Cap - Passive	-9.11%	2.57%	6.32%	8.86%
Managed Fund		Australian Equity	Large Cap - Multi	-3.86%	3.37%	5.65%	8.47%
OZR	OZR	Australian Equity	Large Cap - Passive	3.08%	7.09%	14.62%	6.80%
A200	A200	Australian Equity	Large Cap - Passive	-5.87%	3.61%	-	-

Returns sorted by 10yr returns (to June 30), the funds selected are some of the bigger names in managed funds. OZR included as reference but they are different because they are resources only. There are better performing Aus share funds but usually with a slant (resources, long/short, concentrated, boutique) that I haven't included.

Good active managers can (and do) outperform passive.

 

[Happy Mastenator]

For those who are currently in passive funds, some info to consider:

Product Type	APIR Code	Asset Class/Type	Subsector	Return % (1 Year) (Cumulative)	Return % (3 Year) (Annualized)	Return % (5 Year) (Annualized)	Return % (10 Year) (Annualized)
Managed Fund		Australian Equity	Large Cap - Core	-2.49%	7.84%	9.13%	10.85%
Managed Fund		Australian Equity	Large Cap - Value	5.68%	3.11%	6.40%	10.84%
Managed Fund		Australian Equity	Large Cap - Core	-6.89%	4.45%	7.13%	9.76%
Managed Fund		Australian Equity	Large Cap - Value	8.21%	3.72%	5.65%	9.57%
Managed Fund		Australian Equity	Large Cap - Value	-3.49%	6.44%	6.87%	9.01%
Managed Fund		Australian Equity	Large Cap - Core	0.00%	4.33%	6.99%	8.94%
VAS	VAS	Australian Equity	Large Cap - Passive	-9.11%	2.57%	6.32%	8.86%
Managed Fund		Australian Equity	Large Cap - Multi	-3.86%	3.37%	5.65%	8.47%
OZR	OZR	Australian Equity	Large Cap - Passive	3.08%	7.09%	14.62%	6.80%
A200	A200	Australian Equity	Large Cap - Passive	-5.87%	3.61%	-	-

Returns sorted by 10yr returns (to June 30), the funds selected are some of the bigger names in managed funds. OZR included as reference but they are different because they are resources only. There are better performing Aus share funds but usually with a slant (resources, long/short, concentrated, boutique) that I haven't included.

Good active managers can (and do) outperform passive.

Vanguard Managed retail APIR: VAN0010AU Vanguard Index Australian Shares Fund. This is the Index I've been in the longest, but doesn't take new investors. Benchmark is S&P/ASX 300 Index

The YTD has dragged it all down at the moment.


In regards to active managers outperforming passive funds, this can be true in the short term, but normally doesn't hold up the long term you go as it's impossible to beat the mark each and every year. So if you're more interested in short term returns you can try beat the market with active investing or if after longterm go passive.

My wife and I have a mix. We probably have 60%-70% in passive, 30%-40% in active management.

Noting that this doesn't count our super which is passive and a lot higher than our non-super investments.

 

[Nothing]

Vanguard Managed retail APIR: VAN0010AU Vanguard Index Australian Shares Fund. This is the Index I've been in the longest, but doesn't take new investors. Benchmark is S&P/ASX 300 Index

The YTD has dragged it all down at the moment.
View attachment 1489465

In regards to active managers outperforming passive funds, this can be true in the short term, but normally doesn't hold up the long term you go as it's impossible to beat the mark each and every year. So if you're more interested in short term returns you can try beat the market with active investing or if after longterm go passive.

My wife and I have a mix. We probably have 60%-70% in passive, 30%-40% in active management.

Noting that this doesn't count our super which is passive and a lot higher than our non-super investments.

Do you consider 10 years long term? Your 10 year net of 8.79% is beaten by 6 of those funds. Over my available numbers (which is not the entire funds universe), there are 76 funds that outperformed the Vanguard ETF (which is a mirror of the fund you are in) over 10 years. Some of them are variants (geared, long/short, etc) but there's significant out-performance over the long term.

Active managers don't have to beat the mark every year (or quarter) they just have to beat it consistently over the long term. There are a LOT of rubbish active managers out there, if you can avoid them the task is much easier to generate out-performance.

My 10 year return on my managed fund investment (to 22nd August) is 11.06%pa - I haven't added (or taken) from this fund in that time and the total return is ~185% across that time. Excluding a small amount in cash the worst performing fund was 7.4% pa for a global property fund and 8.36% for an Aus share fund. My other Australian share funds were 10.37% and 10.52%. So your Vanguard outperformed my worst fund by 0.4%pa but underperformed my average by 1%pa. The global shares were 16.62%, 13.66%, 16.73% and 10.42%.

My super (which has had contributions) is -0.59% for last year and 10%pa for 10 years. The contributions are inconsistent so can be skewed to "normal" returns.

All returns are after fees and other costs.

The furphy of index funds and industry funds is that they compare to the average. If you can avoid the crap, you can significantly outperform that average. Finally, index funds (and industry funds) absolutely have a place but they are not necessarily the right option for most people.

 

[sabre_ac]

For those who are currently in passive funds, some info to consider:

Product Type	APIR Code	Asset Class/Type	Subsector	Return % (1 Year) (Cumulative)	Return % (3 Year) (Annualized)	Return % (5 Year) (Annualized)	Return % (10 Year) (Annualized)
Managed Fund		Australian Equity	Large Cap - Core	-2.49%	7.84%	9.13%	10.85%
Managed Fund		Australian Equity	Large Cap - Value	5.68%	3.11%	6.40%	10.84%
Managed Fund		Australian Equity	Large Cap - Core	-6.89%	4.45%	7.13%	9.76%
Managed Fund		Australian Equity	Large Cap - Value	8.21%	3.72%	5.65%	9.57%
Managed Fund		Australian Equity	Large Cap - Value	-3.49%	6.44%	6.87%	9.01%
Managed Fund		Australian Equity	Large Cap - Core	0.00%	4.33%	6.99%	8.94%
VAS	VAS	Australian Equity	Large Cap - Passive	-9.11%	2.57%	6.32%	8.86%
Managed Fund		Australian Equity	Large Cap - Multi	-3.86%	3.37%	5.65%	8.47%
OZR	OZR	Australian Equity	Large Cap - Passive	3.08%	7.09%	14.62%	6.80%
A200	A200	Australian Equity	Large Cap - Passive	-5.87%	3.61%	-	-

Returns sorted by 10yr returns (to June 30), the funds selected are some of the bigger names in managed funds. OZR included as reference but they are different because they are resources only. There are better performing Aus share funds but usually with a slant (resources, long/short, concentrated, boutique) that I haven't included.

Good active managers can (and do) outperform passive.

Good information provided.
Are the returns quoted inclusive of fees?

 

[sabre_ac]

Active managers don't have to beat the mark every year (or quarter) they just have to beat it consistently over the long term. There are a LOT of rubbish active managers out there, if you can avoid them the task is much easier to generate out-performance.

There are also a lot of "active managers" that have effectively created market indexes at higher fees.

 

[Nothing]

Good information provided.
Are the returns quoted inclusive of fees?

Yes. All returns are net.

There are also a lot of "active managers" that have effectively created market indexes at higher fees.

Yep. There are a lot of rubbish ones.

 

[Happy Mastenator]

Do you consider 10 years long term? Your 10 year net of 8.79% is beaten by 6 of those funds. Over my available numbers (which is not the entire funds universe), there are 76 funds that outperformed the Vanguard ETF (which is a mirror of the fund you are in) over 10 years. Some of them are variants (geared, long/short, etc) but there's significant out-performance over the long term.

Active managers don't have to beat the mark every year (or quarter) they just have to beat it consistently over the long term. There are a LOT of rubbish active managers out there, if you can avoid them the task is much easier to generate out-performance.

My 10 year return on my managed fund investment (to 22nd August) is 11.06%pa - I haven't added (or taken) from this fund in that time and the total return is ~185% across that time. Excluding a small amount in cash the worst performing fund was 7.4% pa for a global property fund and 8.36% for an Aus share fund. My other Australian share funds were 10.37% and 10.52%. So your Vanguard outperformed my worst fund by 0.4%pa but underperformed my average by 1%pa. The global shares were 16.62%, 13.66%, 16.73% and 10.42%.

My super (which has had contributions) is -0.59% for last year and 10%pa for 10 years. The contributions are inconsistent so can be skewed to "normal" returns.

All returns are after fees and other costs.

The furphy of index funds and industry funds is that they compare to the average. If you can avoid the crap, you can significantly outperform that average. Finally, index funds (and industry funds) absolutely have a place but they are not necessarily the right option for most people.

The trouble is that there are so many active funds out there, that avoiding the crap, and picking the winners is in itself a risky proposition. Yes, if you pick the right one you might get better returns.

ETF's though will outperform the majority of them and come with a lower element of risk. If you're just interested in pumping money into them over the long term they are perfectly acceptable as a way of driving reasonable returns.

 

[kriles76]

With my SMSF, I was heavily invested in VDHG up to about 12 months ago. I only later became aware that VDHG albeit had strong returns - and I was happy with the investment mix - was really just invested in Vanguard's own managed funds. It meant that the MER was 0.27% - which while comparatively cheaper than many active funds, was still higher than it otherwise might be.

It was also considered somewhat tax inefficient due to locking in capital gains when other investors were buying and selling VDHG units. That meant that capital gains were also attributed to those holders of VDHG that were not selling and you paid more in tax despite holding. That particularly annoyed me.

So, I decided to liquidate my VDHG units and just buy the core ETF's in the same ratio held by VDHG. So it's 40% VAS, 29% VGS/VTS, 18% VGAD, 7% VISM, 6% VGE - and I keep 10% as cash rather that in bonds. The MER for that mix is 0.19%, so a saving of $800 annually per $1m invested in management fees.

Some might consider my cash weighting too heavy, but I keep that there for insurance in case the market tanks; and it also provides me with sufficient capital to buy further ETF's should prices drop. When I reach my buy trigger, I just buy into the ETF that is furthest below it's target holding.

 

[Nothing]

The trouble is that there are so many active funds out there

Agreed.

that avoiding the crap, and picking the winners is in itself a risky proposition.

Disagree. With a little research you can avoid a lot of the crap. There are a few really strong active managers, that are robust with downside protection one of their goals. You don't get downside protection in an index.

Yes, if you pick the right one you might WILL get better returns.

On the assumption that passive returns are all the same (they aren't) then your passive return is going to be index less (very low) cost. If all of the active managers are distributed in a bell shaped curve, then the average of the active will be similar but with a higher fee - therefore net they will be worse than passive. This is the crux of the passive investor's mantra. But if you can avoid those that are consistently in the bottom quartile (and they are a fair few that are consistently bottom quartile) your average of the remaining 75% is much better.
Of the funds I have easy access to (once again not the entire funds space - a lot of the crap has already been filtered), the 10 year average of bottom quartile (across all styles) is 7.74%. The average of the top 75% is 10.06%.
The average of the investment grade space I deal with is 9.71% (of the funds with 10 year track record).

ETF's though will outperform the majority of them

Yes or at lest close to the majority.

and come with a lower element of risk.

Disagree. You have nobody making decisions on the future of the company. You have nobody making decisions on known facts. Passive funds are reactive to market change.

If you're just interested in pumping money into them over the long term they are perfectly acceptable as a way of driving reasonable returns.

Yes. I'm not saying that passive is not an option. But the furphy that they are better than active has been laid out with stats. They are perfectly acceptable as a way of driving reasonable returns. I want more than reasonable returns and for the last 10 years I've got an additional 22% (total) return over an index fund.

 

[kriles76]

The property generates rental income with GST applied, which requires a quarterly BAS to be submitted to the ATO. Our accountant does that. But I need to do some basic bookkeeping such as compiling cash flow statements and keeping statements, receipts and invoices. That's probably 1-2 hours work per quarter on my part. None of that would be necessary if we were just invested in shares/ETFs.

I'm quoting myself here but I had a win today with respect to this gripe I had regarding quarterly BAS.
As it happens, you can submit annual GST statements if the turnover is less than $75k.
That'll save me a few hundred dollars in accounting fees annually and probably about 3-5 hours of bookkeeping.

The next task I have is to complete the ATO contribution splitting election form. You are able to apportion up to 85% of your concessional contributions to your spouse's super. That's a priority for us because my share of the SMSF is significantly above that of my wife.

 

[kriles76]

I’m out because of my SMSF, but Vanguard finally have approval from APRA to proceed with creating own super fund. I wonder what the fees will be like.

 

[GreyCrow]

Moving away from salary sacrifice to a couple of general questions

Background

My general health deteriorated over the last year to the detriment of work and I quit. I had hoped to keep going as long as possible but physically couldnt do it and awaiting an operation (still) means my return to work is going to be at least October this year (at best)

I looked into my meagre super amounts and wondered if I could take some out - Hardship call. But I found I would be taxed at 22% - I read that to drag 10k out I give away 2200 of that. I havent reached 60

Is that correct?

The 2nd question is in regards to the Labour commentary about shutting this avenue down. How long will this take to legislate and would I be better off doing what I can now?

I do want to try and hold off but recognise taking a chunk out and paying down most of my loan will help reduce my payments or at least increase the amount paid off each month.

I have 12 months before I can access my super fully

 

[Nothing]

Moving away from salary sacrifice to a couple of general questions

Background

My general health deteriorated over the last year to the detriment of work and I quit. I had hoped to keep going as long as possible but physically couldnt do it and awaiting an operation (still) means my return to work is going to be at least October this year (at best)

I looked into my meagre super amounts and wondered if I could take some out - Hardship call. But I found I would be taxed at 22% - I read that to drag 10k out I give away 2200 of that. I havent reached 60

Is that correct?

The 2nd question is in regards to the Labour commentary about shutting this avenue down. How long will this take to legislate and would I be better off doing what I can now?

I do want to try and hold off but recognise taking a chunk out and paying down most of my loan will help reduce my payments or at least increase the amount paid off each month.

I have 12 months before I can access my super fully

Yes, if you are under 60 lump sum withdrawals are taxed. There are different components within super that can affect how much tax you actually pay. Once you are 60 withdrawals (from most funds) are tax free. Do you have any insurance within the fund (I assume not based on age), you may be eligible for payout if you have.

 

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Anyone run an SMSF? Who do you use to set it up, the legal etc?

 

[ash_1050]

Anyone run an SMSF? Who do you use to set it up, the legal etc?

Yep, I set it up through Stake for $990. Entirely hassle free process, highly recommended if you're going down the SMSF route.