This article by the SMH promises a golden age for superannuation thanks to reforms adopted by the government. Ultimately the idea of saving is great. But the problem I have with it:
1. Why would I want to simply get average earnings from a super fund that can only invest in large companies
2. Why would I want average returns? Fund managers manage billions, and many of them, whom I don't know are not even very good. They often don't even invest their own money. History is no indicator of future performance.
3. Why would I want restrictions on how I spend the money? There are tax advantages and disadvantages with super. The big problem is the risk of expropriation. Its a pool of money that can be taxed. No wonder small biz with the discretion to use it, don't bother.
4. Why would I want a pool of funds, locked into government control for 10-40 years, which the government can tax if it manages the economy so bad, or they think I made too much profit? That's the implication I can draw from their opportunistic grab at miners with the Resource Rent Tax. Of course this tax was sunk by opponents, but 40% of people supported it, and we are not in any dire economic situation.
I did not even read the article. Unless super funds are investing in a fighting fund to severely restrict the powers of 'arbitrary government' I am not interested. Alas, they are middlemen like government professing to offer some service and taking a fee in the process. Savings and investment are important. Too important to leave your savings to others. If you are less than 40yo you ought to be developing your own investment skills. Trust me, even if you don't make exemplary gains, at least you will have enjoyed it, and added to your job skills. It might even help you avoid Alzheimer's Disease. Most certainly it will protect you from the biggest, most vilest people you are even to come across - your 'representative' in Canberra.
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Author
Andrew Sheldon
