Work for the dole

[Hewy54]

I am recently retired (14 months now) and am lucky enough to be self funded. I will never get any govt help as I have too many assests. I do not view my taxes as a "bank account" that I pay into while working and draw on in retirement. I am quite happy that my taxes from 40 years have gone into govt coffers to provide health, welfare, emergency services and education.
In a welfare state those of us who earn a good wage contribute more to those not so lucky. Unfortunately there is always the minority who will rort the system. The idea of work for the dole has merit if we were able to target the right ones.
I do agree with Paceman that it is quite reasonable to be expected to sell some assests to help fund short term unemployment.

[IanC]

I do agree with Paceman that it is quite reasonable to be expected to sell some assests to help fund short term unemployment.

The issue I have is that you have two identical people with identical opportunities, wages etc etc etc.  One is the saver puts money away pays off their house etc.  The other lives it up, has nothing, rents etc.

Why should the saver be penalised having to sell assets etc and the other is entitled to government benefits immediately when they both find themselves out of work on the same day?

[stabicraft]

I believe that everyone deserves a pension, those who have worked deserve it because they bloody well paid for it.

Just a quick question to ant self funded out there.

I have just had a looooong talk with my financial adviser, If I pool all my cash and use my super I can be self funded to the tune of $45k a year.
Is $45k enough to live on and have a reasonable standard of life.
We own everything we have, our cars are less than 6 years old and there is no pressing repairs needed on our house.
We dont drink, somke or have any expensive hobbies.

But Id like to be able to get away occasionally and have a comfortable life without eating dog food.

If I cant get work in the next 4 months, Ill have to go down this path.

Cheers

[Hewy54]

One of the huge problems I had looking to retirement was trying to work out how muck I will need as an income in retirement. People are very shy when it comes to revealing their financial situation. In the time I have been retired we have moved house and spent a lot on the new house and have bought our Vista. Now that things have settled down a bit, I find that the $52k a year is ample. At the moment I drink and smoke (much to the disgust of my GP). Only concern I can see is if later on I want to change or upgrade any of the big ticket items.

[paceman]

The issue I have is that you have two identical people with identical opportunities, wages etc etc etc.  One is the saver puts money away pays off their house etc.  The other lives it up, has nothing, rents etc.

Why should the saver be penalised having to sell assets etc and the other is entitled to government benefits immediately when they both find themselves out of work on the same day?

the only question i have is this:

what's the point of accumulating assets through your life, if they don't provide a benefit later (ie: financial independence)

obviously, it depends on the asset, but if you have accumulated a large property portfolio (for example), but are unable to gain financial stability from that, what's the point?

[Hewy54]

the only question i have is this:

what's the point of accumulating assets through your life, if they don't provide a benefit later (ie: financial independence)

obviously, it depends on the asset, but if you have accumulated a large property portfolio (for example), but are unable to gain financial stability from that, what's the point?

x2

[edz]

[quote

Is $45k enough to live on and have a reasonable standard of life.

Cheers
[/quote]
If you own everything and cant live on $870 a week somethings wrong ..

[gronk]

One of the huge problems I had looking to retirement was trying to work out how muck I will need as an income in retirement.

Can be very complicated......depending on how long you live for....are you only spending interest......or dipping into funds as well....??

Most self funded retirees grapple with these questions......especially if the share market dives ( if you have super etc )..

If you have assets ( say property ), when is the best time to sell some of it ??

A financial adviser ( one that doesn't actually touch your money ) is probably essential if you want to maximize returns.....even a talk to one for assurance you are doing everything right ??

I figure I've got 20 yrs of "good" life left ( if I live that long ), so in that time if funds allow, at least one new 4wd and a new van will probably be needed, so you have to add that on top of the annual "wage " as well !

[cruiser 91]

I remember Packer's famous words.

Anyone who doesn't try to reduce their tax is an idiot.

I have also seen plenty of wealthy organisations reap as much free cash from the government as they legally could.

I can say from experience..............gold bullion is a excellent way to "hide" hard earnt cash to top up welfare payments or to escape paying tax.

Life has absolutely nothing to do with fairness. Its about how good you are at playing their ever changing game. 

Why do you think they wants us to head in a direction of a cashless society?

I say.................rage against the machine in my own way....................I control my life............."NOT THEM" 

I remember many decades ago........my father once said to me as a teenager, "It's not much $$$ you earn in your job, it's what you do with it afterwards that will determine your life stlye"

Sorry about the rant.

    

[Nifty1]

I kinda like the system they have in NZ. When you get to retirement age, you get the pension. But it's part of your assessable income and you pay tax on it. Imagine what we could save if we got rid of the hordes of public servants, computer systems and consultants who are currently checking up on your assets and income so they can adjust your pension payment twenty-six times each year. I reckon such a system might actually cost less overall and everyone would think it fair.

[stabicraft]

Ill open up
The "assets are a boat , a camper, 2 cars and 100k in the bank plus my household furniture and my wife's antiques and tools.
They did an estimate and it just goes over the threshold...........of course.

The two years is based on my redundancy and payout which They say I can live on for two years.

I have my own home, and own everything, owe nothing to no one.

I have saved and slaved to own these things, including my boat and would like very much to get to use it, not sell it.

After yet another knock back today, not even an interview .....again, its looking like I have little choice.

Should have gone into politics or the public disservice, bummer

[krisandkev]

stabicraft,  a good financial adviser would be your best friend.  (Most advisers do not charge for a first visit.)  We spoke to a few prior to my retirement almost 5 years ago, at the old age of 55. Found one and he and his firm have been looking after mine and my wife’s super since then.  He does everything, including our tax returns and so much more.  We have a Self Managed Super Fund (SMSF) and although a SMSF does not suit some it has worked well for us.  I just reached the 60 mark and now my withdrawals are tax free. I hate the share market but without it our fund would not be in such a good position, and we are very cautious investors believe me! It was extremely hard to hand over all of our hard earned money but you just have to trust someone sometimes.   We know how volatile the market is and still worry because the world could get hit by another financial collapse anytime.  We also do not qualify for any assistance but our SMSF does get tax concessions, so that is a real plus. And a good adviser is not cheap.  Our adviser works on a percentage that is held in our fund basis, so the more our fund increases the more he gets. He is totally independent and receives no commissions from the businesses we have shares in. We can call him anytime to ask advice at no extra charge and that is very helpful.  Kevin

[rotare]

I guess a lot of this discussion depends on what you believe you pay / paid tax for, and whether paying tax for X years automatically entitles you to receive monetary assistance to live, once you retire.

One thing that I've come to learn recently is that as a Nation generally, we're living beyond our means.  Everyone wants more and a better standard of living, but no-one wants to make any sacrifices or pay a cent more for it.     

[gronk]

Ill open up
The "assets are a boat , a camper, 2 cars and 100k in the bank plus my household furniture and my wife's antiques and tools.

Mine is 2 cars, a van and 50K in the bank........and I believe I'm eligible.....when my waiting period is up ( is nearly 1 1/2 yrs.....this december )

I really hope I can get a job before dealing with the centrelink robots, but it's not looking good..

[Kangaron]

Ill open up
The "assets are a boat , a camper, 2 cars and 100k in the bank

I hope your wife doesn't develop a gambling problem and chews through $10K a week for 10 weeks.

[stabicraft]

As for paying tax and expecting things, that was one of the reasons taxes were introduced in the first place, to support the aged past retirement.
Govco bet on us dying before we cash in, and in many cases this is true.
But as we live longer, and as they suck more and more from the system for their own benefit, the cash is drying up.

But over the years, the reason for taxes has changed, with the impost and excessive expenses that our elected leaders expect and unfortunately get.
Why does a politician or senior public servant get asset test free pensions which are far in excess of that "enjoyed" by those who have paid for it?
I can understand paying some public servants a higher pension, military, police, nurses etc, those who have given freely of their lives to help us.
But politicians, fat cats and judges? what have they done to deserve tax free, excessive pensions when in many cases they are multi millionaires anyway? and the only giving they do is giving to themselves.

Other parasites on the system, aid for other countries, illegal immigrants and blood sucking organisations such as the United Nations are all a worthless drain on the system, stop it now.

Simple to fix really.
One pension for all, regardless of who you are or what you do, with a full asset test for all, However if one is an essential service such as military, nurses, police, ambulance drivers and firemen, a special dispensation for the work they do.
All overseas aid to stop NOW, no more immigrants until everyone in Australia is working
Finally all multinationals to pay the ta they owe or they leave and we keep the assets from their business, including copyright.
All politicians and public servant to travel using the same model as used by "real" organisations. pay first, claim expenses for all travel and be reimbursed IF applicable. With seriously clear and suitable rules about travel expenses and entitlements.
Seriously reduce the levels of government to two, and cut the numbers considerably, there are too many of them.

Australia would be in a much better position and all this kicking the poor sod without a job because of moronic government policy and "Free trade" will stop.

[paceman]

Other parasites on the system, aid for other countries, illegal immigrants and blood sucking organisations such as the United Nations are all a worthless drain on the system, stop it now.

a fair chunk of the aid that we provide to other countries does a lot of good and so does the work of the UN... and if you happened to live in those countries, rather than our own country, you would quickly see that we are doing pretty well considering.

at least a lot of us earn enough money to pay tax and accumulate luxuries like boats, cars and camper trailers...

as a first world country, we have a responsibility to help other countries that cannot help themselves.

but, by the same token, we should also be helping our own people first and not provide aid to countries that do not require it...

[gronk]

Trouble with the system is they want you to be self funded, but then make it hard to pump heaps into your super so you CAN be self funded..

Tax you on the way in and again on the way out..

[stabicraft]

Its called greed.
and unfortunately it is lorded over by the stupid.

So we have greedy, stupid people running the stuff.
That's why, if you have enough money, you can beat the stupid and pay little or no tax to the greedy.

The guy up the road from me owns his own business, has big boats, Jags and harleys.
lives in a big house on two blocks and has an overseas holiday every year.

His daughter was eligible for aus study though, and he told me he pays tax on $25k a year, thanks to his accountant.
Everything is claimable, from his house to the trips overseas, work expenses.
His parties are also claimed.

Suckers like me have no way to do this so I pay more tax than he actually claims as a wage.

The system is sick, broken and cant be fixed by the impotent, stupid, greedy bribe taking pollies and public servants we currently have.
And getting them out would be harder than getting a bush tic out of a a wool bound sheep.
Cant beat the system, I'm going to try and join it..............if I can

[paceman]

Trouble with the system is they want you to be self funded, but then make it hard to pump heaps into your super so you CAN be self funded..

Tax you on the way in and again on the way out..

definitely agree on this point...

[Hewy54]

Its called greed.
and unfortunately it is lorded over by the stupid.

So we have greedy, stupid people running the stuff.
That's why, if you have enough money, you can beat the stupid and pay little or no tax to the greedy.

The guy up the road from me owns his own business, has big boats, Jags and harleys.
lives in a big house on two blocks and has an overseas holiday every year.

His daughter was eligible for aus study though, and he told me he pays tax on $25k a year, thanks to his accountant.
Everything is claimable, from his house to the trips overseas, work expenses.
His parties are also claimed.

Suckers like me have no way to do this so I pay more tax than he actually claims as a wage.

The system is sick, broken and cant be fixed by the impotent, stupid, greedy bribe taking pollies and public servants we currently have.
And getting them out would be harder than getting a bush tic out of a a wool bound sheep.
Cant beat the system, I'm going to try and join it..............if I can

My daughter and her husband are in this position. They got there by hard work and taking a risk. Thanks to them now 24 of their employees have a job.
As to being controlled by the stupid and greedy - rather than complaining about how they get too much, maybe we should pay our pollies more so we can get some quality people to run the country properly.

[BaseCamp]

To answer a couple of questions in the last few posts...

I have been told by my FA that if you own your own home and are otherwise debt free; then:

Approx $50pa allows a single to have a good lifestyle in retirement..
(This is defined as OS trips; restaurant meals; etc...).

For a couple - the price is approx $80Kpa..

AMP has a really good website that explains all of this in a very clear way...

But that means you need between $1M and $2M in your super....

This is if you have it invested conservatively (say earning 5% return) - and are retired (at age 65 and paying no tax on your income streaming from your SMSF or other vehicle).

I understand the family home is not calculated for the purposes of assesing whether you fall into the "Self Funded" camp...

I think once you have other assets that add up north of $900K - you are totally on your own, BUT between $900K and zero - you are eligible for some Govtco pension (pro rata) for your retirement...

Assuming you have "windfalls" along the way (before you hit 55yo or 60 - 65yo...) --    once the "normal" tax is paid on it at your marginal rate - you can chuck the rest into your super...   (No more than $450K over 3 years and up to a max of 150Kpa...)    ...Or has Govtco recently mucked with this one??     

[Oldandslow]

The problem with the "system" we live under is that everyone wants to get more out of it than they are prepared to put in to it.

The pension system can not work, it's simple mathematics. If people only lived for a few years after they retire then it would have a chance but with our present life expectancy the numbers don't work out. Basically we are living under a pyramid scheme where future generations will be called upon to pay for our excesses.  We think we can work for thirty years and then get a free ride for thirty more because we put away 5% of our wages into a retirement fund. How can that work? Some even think if they pay a few dollars in tax then they should also be entitled to support for 30 years of retirement. Throw in the ridiculous amount of money that goes into medical care to keep most retiree's alive and even blind Freddie can see it can't work. The US does not have anywhere near the retirement and medical privileges that we have yet they are very close to imploding. If any other country was in the financial position of the US it would have collapsed years ago.

I live in a retirement area and can honestly say I don't know anyone that has truly financed their retirement but everyone seems to be living very comfortably. History has shown that civilizations last about 200 years before they collapse, glad I am not starting out now.

[Troopy_03]

My daughter and her husband are in this position. They got there by hard work and taking a risk. Thanks to them now 24 of their employees have a job.
As to being controlled by the stupid and greedy - rather than complaining about how they get too much, maybe we should pay our pollies more so we can get some quality people to run the country properly.

I think this is the bit Stabicraft is disgusted with, and quite rghtly so

"  His daughter was eligible for aus study though, and he told me he pays tax on $25k a year, thanks to his accountant.
Everything is claimable, from his house to the trips overseas, work expenses.
His parties are also claimed. "
Basically just rorting the system

[Nomad]

I think this is the bit Stabicraft is disgusted with, and quite rghtly so

"  His daughter was eligible for aus study though, and he told me he pays tax on $25k a year, thanks to his accountant.
Everything is claimable, from his house to the trips overseas, work expenses.
His parties are also claimed. "
Basically just rorting the system

Then at some point he or his accountant is going to have to pay the piper. Sounds like a bit of bragging going on there.

I agree that our whole government structure, taxation and welfare need overhauling. In fact companies like EY have come up with some seriously impressive discussion papers on better ways we can run the country but as if the existing hierarchy are going to change the status of that.