Author Topic: Australian Investment Advice  (Read 9277 times)

Pyrmont

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Australian Investment Advice
« on: September 13, 2016, 06:43:52 AM »
Hi,
it's my first time posting but I've been lurking here a long time. I've been planning to invest/save using what I've learned here for a long time but have procrastinated for a variety of reasons. I'd really like to get started and would appreciate some advice.

My ultimate goal obviously is financial independence but at the very least, I'd just to like to start saving and investing wisely to build a nest egg.

I'm 33, Irish but based in Australia for the foreseeable future. I'm currently working part time , partly because we've recently had our first baby but I'm hoping to increase my hours soon. I'm currently working 3 days and roughly making $70k p.a. after tax. I have a balanced super account with AustralianSuper, with very little in it - ~$10k so I know I need to step that up as well. I have pretty low expenses ( e.g. cycle to work etc ) and am trying to get them even lower again.

Myself and my partner are currently renting with a view to likely buying in the next year or 2. She sold her unit a couple of years ago and that income, which is in a long term deposit, will likely be used for the bulk of our mortgage/mortgage deposit.

I have ~€50k in an Irish bank account earning next to nothing and I plan on transferring that to my Australian accounts. I also have about $70k in an easy access online savings account.
My plan would be to start using a Vanguard fund of some description.

My main question is what fund? Originally I was looking at having 3 funds eg. Australian shares, international and maybe fixed interest, if that makes sense although I wasn't sure to allocate each asset. However I've been looking at the Vanguard life Strategy Growth Fund and that seems to accomplish the same diversification in one fund? While I'm motivated and trying my best to manage my finances,  I know I'm not always the best to keep on top of things and to do regular detailed analysis etc,  so that one fund seems like a solid way of investing for someone like me but I'm very open to advice/suggestions.

If I did go with that fund,  how much should I put in at the start e.g. if I have $50k should I deposit the entire sum and then add so much every month or should I put money in, in stages.

If I did open a fund/s, I was planning to do so in my partners name for tax reasons, as she is not working at present. I don't know if that makes sense?

I've read Bogle's book of Common Sense Investing. He seemed to be a bit iffy about ETFs but they seem popular on this site. Should I be looking at them rather than an index fund?

I hope I've explained things reasonably well and my questions aren't too silly. Thanks in advance for any help/advice

marty998

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Re: Australian Investment Advice
« Reply #1 on: September 13, 2016, 03:25:50 PM »
You've done well clearing $70k after tax only working 3 days a week. Also a little envious of the Pyrmont location :)

If I could do that I'd keep the 3 day week.

Where are you looking to buy a property? Lots of choice, but as you know you probably won't get much change for a million.

GT

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Re: Australian Investment Advice
« Reply #2 on: September 13, 2016, 04:52:18 PM »
I wouldn't be too concerned about your Super account balance, it's not going to be accessible until in your 60's or later (depending on law changes) and you'll be wanting to retire before it's available, so a source of funds outside Super is what you should be aiming at.  If you can switch it from AustralianSuper to SunSuper you'll be better off in the long term due to less fees.

Spreading your risk across different index funds is a good idea, whether that means you have Australian (some prefer keeping their Aussie funds in their Super for franking benefits) or International funds is a decision you'll need to make.  So long as you're buying into the Vanguard funds you'll do OK on MER.  You also have enough cash, if you get the Euro's over here, to buy directly into the Wholesale funds ($100K buy in not $500K if you call Vanguard) which will save you a little bit more in costs.

It may be that a Trust structure could be an option for you, even if your partner is currently off work, they will be returning eventually? and if so will you be saving much in taxes?  There's a post somewhere in bigchrisb's thread that has his preferred structure to do this.  I'll see if I can track it down.


misterhorsey

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Re: Australian Investment Advice
« Reply #3 on: September 13, 2016, 05:11:17 PM »
Hi,
Myself and my partner are currently renting with a view to likely buying in the next year or 2.

Just noting that investing in the stockmarket for the short term isn't always compatible with a firm plan to buy a house. If the property market tanks and your fund increases in value you are laughing. However, if the fund drops in value, at the time you want to buy, you'll have wanted to keep it in cash. 

So long as you accept that the timing of your house purchase now has a new variable, your willingness to cash out of the fund, then you'll be fine. This is the approach I've adopted. If the property market drops and it shows good value, but my funds stay the same or don't drop by as much, I may re-enter.  But it's an acknowledgement that the timing of a property purchase is now a little more dependent on other external factors.


I've read Bogle's book of Common Sense Investing. He seemed to be a bit iffy about ETFs but they seem popular on this site. Should I be looking at them rather than an index fund?

As you know, Bogle's investment philosophy is based on dollar cost averaging small amounts into an index fund representing the entire US market.  Doing this regardless of market conditions and holding for an eternity. Over time, this strategy should beat any active investment fund manager. 

My understanding of his concerns with ETFs is that it provides liquidity to an investment that previously wasn't.  ETFs are as easily traded as shares, and are sometimes marketed as such.  Bogle thought that making ETFs so liquid, made it possible for investors to try their hand at day trading indexes.  I'm summarising considerably here.  I read this in an interview with him and not sure if it's discussed in the book you read.

Most homeowners are fans of the wealth creating characteristics of real property.  But the fact is, most people seem to do well out of property due to the demands of their mortgages, the leverage entailed, but mainly the enforced savings they have to commit to to feed the mortgage. 

ETFs take away some of the discipline of a dollar cost averaging approach and make possible, and possibly tempting, a trading, market timing approach to indexes. 

Some people on this forum do enjoy a bit of market timing.  I myself have bought into VAS as  lump sum but have left it as a set and forget, with dividends reinvested.  The management fees are smaller than a lifestye fund. For regular small contributions over time ETFs aren't great however due to brokerage costs.

GT

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Re: Australian Investment Advice
« Reply #4 on: September 13, 2016, 06:13:23 PM »
Found roughly what I was looking for.

http://forum.mrmoneymustache.com/journals/bigchrisb's-journal/msg624764/#msg624764

Hopefully bigchrisb can post in here and clarify.

Chris-93AUS

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Re: Australian Investment Advice
« Reply #5 on: September 13, 2016, 11:29:46 PM »
Hi Pyrmont, good to see a fellow Aussie on MMM.

I would recommend that you research and reflect a bit on how you handle risk and what you would do if the market tanked the day after you invested and see what type of "Risk Profile" you fall into, as that has a lot to do with how you should invest.

From what you've stated it appears to me that you have growth preferences with the goal of also owning a home soon.

I'd go simple,

6 month emergency fund, and split your remaining funds between the "House Deposit" (a second savings account with your bank or some such that you eventually use when you find a place you want) and place the remainder with Vanguard.
I'd have a look at the "lifestyle" funds rather than straight ETF's.

Min $5,000 deposit, and you can bpay $100 min once open. They diversify across various funds depending on your choice, balanced, growth, high growth etc.

I myself am investing into the High growth fund, dividends paid out in July of 3.2% which was nice.


Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.

Edit - I forget to mention, as for the initial deposit into Vanguard, statistically better to invest now rather than dollar cost average however if you are a bit more conservative than dollar cost averaging is completely fine too.
« Last Edit: September 13, 2016, 11:31:35 PM by Chris-93AUS »

Pyrmont

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Re: Australian Investment Advice
« Reply #6 on: September 14, 2016, 05:52:09 AM »
Thanks for all the advice. Just getting a chance to read through it now. I really appreciate the effort and thoughfulness of the replies.

I'm not actually based in Pyrmont anymore unfortunately. It will most likely be Adelaide that we buy in. Not quite as expensive as Sydney but not cheap either.

I've previously been advised not to set up a trust just yet but it's something I'm aware of and probably will do down the line.

Anyway thanks again for the advice - just have to get down to it now :-)




Notch

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Re: Australian Investment Advice
« Reply #7 on: September 14, 2016, 06:05:56 AM »
I wouldn't be too concerned about your Super account balance, it's not going to be accessible until in your 60's or later (depending on law changes) and you'll be wanting to retire before it's available, so a source of funds outside Super is what you should be aiming at.  If you can switch it from AustralianSuper to SunSuper you'll be better off in the long term due to less fees.

I'm not so sure about that.  The last time I looked i thought AustralianSuper was one of the lowest cost industry funds.

marty998

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Re: Australian Investment Advice
« Reply #8 on: September 14, 2016, 06:48:58 AM »
Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.

Sounds like you have bought the over the top scare campaigns. I highly doubt they'll raise the age to 75 and no, it won't be taxed to buggery either. The Government is tying itself in knots over a proposal to have $1.6m tax free and only tax earnings above that... which is a level very few will get to anyway.

In his tax bracket he'll save 24% tax by salary sacrificing. It also means we won't get smashed on tax now by having investments outside of super. It's a huge benefit worth considering.

Juan Ponce de León

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Re: Australian Investment Advice
« Reply #9 on: September 14, 2016, 03:34:03 PM »
Too many threads asking about Australian investing, it should all be in the main thread.

Chris-93AUS

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Re: Australian Investment Advice
« Reply #10 on: September 14, 2016, 07:31:25 PM »
Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.

Sounds like you have bought the over the top scare campaigns. I highly doubt they'll raise the age to 75 and no, it won't be taxed to buggery either. The Government is tying itself in knots over a proposal to have $1.6m tax free and only tax earnings above that... which is a level very few will get to anyway.

In his tax bracket he'll save 24% tax by salary sacrificing. It also means we won't get smashed on tax now by having investments outside of super. It's a huge benefit worth considering.


No I haven't bought any scare mongering, but I find that for a nation with a growing elderly population and very low birth-rates/extreme immigration control, that  unless something drastic changes our social security will become increasing difficult to fund and Super, being one of the bigger asset pools available for the government to tap will be a target. Think about it, we have some of the highest income tax rates, business tax rates, so what's next? What's left.

Raising the age to 75 was more of a comment about how older people are finding they have to work longer and longer to be able to live above the poverty line. You only have to open the paper to see countless issues about pensioners being forced to make more of less.

Its also why I find MMM less about a lifestyle and more about necessity. For 90% of people, if they could live frugally earlier in their lives than the above wouldn't be such an issue. Social security would be far more tenable.

Fair point on the tax concession due to salary sac though. In fairness I forgot about that. My only argument would be that as super is locked away for such a long time and the OP wishes to buy a house in the near future, perhaps contributing super isn't the best allocation at this time.

Mark31

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Re: Australian Investment Advice
« Reply #11 on: September 14, 2016, 09:34:32 PM »
I would also say that Pyrmont should not put any extra into super, given his age and desire to buy a house in the near future, and I’m not concerned about the future of super.

I think when you hit 40 is a good time to consider boosting super, depending on your projected FI date. If you get an employer match however, that's a different story.

Super will be tweaked and modified, and maybe the age of access will go up a little but it will remain a pretty good investment vehicle for most people. It’s pretty politically difficult to raid super, and then more would have to be forked out on age pension.

bigchrisb

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Re: Australian Investment Advice
« Reply #12 on: September 14, 2016, 11:50:45 PM »
I'm in the make use of super camp - its too good a tax rort to give up.  You need to see a whole lot of regulatory harm to get back to a break-even perspective.

However, I'm a strong believer in diversification in holding structures, as well as diversification in asset allocation. 

My approach to try to hedge the tax man is:
- Own a PPOR.  No tax on imputed rent is one of the biggest subsidies going, followed by the CGT and land tax exemptions.  I use my home for investment leverage (I deferred buying a PPOR until I had the equity to buy outright, but took out a loan, then paid it out / re-drew to refinance my margin loans against the house).
- Take full advantage of salary sacrifice to super for the tax lurk.  I also use a SMSF, so I can optimise which tax bracket different different investment income is in.
- Invest the rest in a family trust with a corporate trustee.  I stream capital gains and tax deferred income to people (myself or family as needed), but standard income to a corporate beneficiary (28.5%, soon to be 27.5%).  Let that sit in the company compounding, with the franking credits stored until I need them.  Plan on this being enough to satisfy my SWR, with super later in life as a bonus, or as a form of self insurance.

I guess what I'm trying to get at is there are multiple tax baskets to allocate between, and an unknown regulatory risk of how this may (or may not) change in future.  I'm spreading my risk between these.

steveo

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Re: Australian Investment Advice
« Reply #13 on: September 15, 2016, 01:14:13 AM »
I don't really care about tax advantages in that I can't be bothered setting up a family trust but the advice on here is good.

I think though that you need money outside of super as well as in super.

1. Pay off the house if you have one. This is a tough one for me to recommend with house prices as high as they are now. I would do the maths on home ownership. I own my house though and it's a great advantage.
2. Work out how much you need inside and outside super. We don't put any additional funds into super but only because we need more outside of super. I do think super is great though.
3. Invest the minimum you need outside super in whatever you want. Personally I like the Vanguard lifestyle funds but I didn't have $100k to start a wholesale fund so I've gone the 3 fund ETF route - VAS, VGS & VAF.

marty998

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Re: Australian Investment Advice
« Reply #14 on: September 15, 2016, 01:52:16 AM »
Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.

Sounds like you have bought the over the top scare campaigns. I highly doubt they'll raise the age to 75 and no, it won't be taxed to buggery either. The Government is tying itself in knots over a proposal to have $1.6m tax free and only tax earnings above that... which is a level very few will get to anyway.

In his tax bracket he'll save 24% tax by salary sacrificing. It also means we won't get smashed on tax now by having investments outside of super. It's a huge benefit worth considering.


No I haven't bought any scare mongering, but I find that for a nation with a growing elderly population and very low birth-rates/extreme immigration control, that  unless something drastic changes our social security will become increasing difficult to fund and Super, being one of the bigger asset pools available for the government to tap will be a target. Think about it, we have some of the highest income tax rates, business tax rates, so what's next? What's left.

Raising the age to 75 was more of a comment about how older people are finding they have to work longer and longer to be able to live above the poverty line. You only have to open the paper to see countless issues about pensioners being forced to make more of less.

Its also why I find MMM less about a lifestyle and more about necessity. For 90% of people, if they could live frugally earlier in their lives than the above wouldn't be such an issue. Social security would be far more tenable.

Fair point on the tax concession due to salary sac though. In fairness I forgot about that. My only argument would be that as super is locked away for such a long time and the OP wishes to buy a house in the near future, perhaps contributing super isn't the best allocation at this time.

Old people die eventually. We won't have to fund their full age pensions forever. The oldies entering retirement in 15 years time will have a level of super that will supplement a part age pension.

Interesting you think we have extreme immigration control when over 140,000 immigrants arrived in Australia last year (admittedly down from 300,000 a few years back). Birth rate is still over 2.1 as well so not sure what you are getting at.

You're in Tasmania, which has a population the size of a small portion of Sydney. Come here and I can tell you the city is bursting at the seams. The last thing we need is more people, without the infrastructure to cope.

Tax rate is high because we hand out too many concessions to old people. Taxes on super should be raised as a matter of intergenerational equity more than anything else.

urbanista

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Re: Australian Investment Advice
« Reply #15 on: September 15, 2016, 02:14:19 AM »
I disagree that people close to retirement age have to work longer and longer. All they need to do is to downsize their house, the prices for detached houses are beyond ridiculous.

Also, it doesn't make any economic sense to increase the super preservation age. People who would otherwise use their super, would have to go on the dole, while super would go to their children upon death. It is very hard to force someone over 60 yo to work if they don't want to. Paid off house plus dole is enough to get through to the age when super will be available, even if it is 75.

marty998

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Re: Australian Investment Advice
« Reply #16 on: September 15, 2016, 02:30:12 AM »
I disagree that people close to retirement age have to work longer and longer. All they need to do is to downsize their house, the prices for detached houses are beyond ridiculous.

Also, it doesn't make any economic sense to increase the super preservation age. People who would otherwise use their super, would have to go on the dole, while super would go to their children upon death. It is very hard to force someone over 60 yo to work if they don't want to. Paid off house plus dole is enough to get through to the age when super will be available, even if it is 75.

Entitlement mentality is hard to shake in many oldies... spoke to one last week who downsized. She had to find a much nicer apartment than the house she was living in. Wanted to spend as much as possible so she could get the full pension.

She just could not see that she would be better off freeing up the capital. Maybe she could but wanted to keep the capital for inheritances for her family and live off the taxpayer in the meantime. As a taxpayer, I cried because my taxes are needlessly higher. As a lover of maths, I cried because she couldn't do the sums, and has probably made a few self defeating decisions in her lifetime in order to arrive at this position as well.

Or like I said maybe she did do the sums and is taking everyone for a ride.

potm

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Re: Australian Investment Advice
« Reply #17 on: September 15, 2016, 02:34:54 AM »
I suspect for most intelligent mustachians when they are 60, they will be more focused of how to get it in super, rather than when they can withdraw it.

Chris-93AUS

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Re: Australian Investment Advice
« Reply #18 on: September 15, 2016, 05:43:43 PM »
Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.

Sounds like you have bought the over the top scare campaigns. I highly doubt they'll raise the age to 75 and no, it won't be taxed to buggery either. The Government is tying itself in knots over a proposal to have $1.6m tax free and only tax earnings above that... which is a level very few will get to anyway.

In his tax bracket he'll save 24% tax by salary sacrificing. It also means we won't get smashed on tax now by having investments outside of super. It's a huge benefit worth considering.


No I haven't bought any scare mongering, but I find that for a nation with a growing elderly population and very low birth-rates/extreme immigration control, that  unless something drastic changes our social security will become increasing difficult to fund and Super, being one of the bigger asset pools available for the government to tap will be a target. Think about it, we have some of the highest income tax rates, business tax rates, so what's next? What's left.

Raising the age to 75 was more of a comment about how older people are finding they have to work longer and longer to be able to live above the poverty line. You only have to open the paper to see countless issues about pensioners being forced to make more of less.

Its also why I find MMM less about a lifestyle and more about necessity. For 90% of people, if they could live frugally earlier in their lives than the above wouldn't be such an issue. Social security would be far more tenable.

Fair point on the tax concession due to salary sac though. In fairness I forgot about that. My only argument would be that as super is locked away for such a long time and the OP wishes to buy a house in the near future, perhaps contributing super isn't the best allocation at this time.

Old people die eventually. We won't have to fund their full age pensions forever. The oldies entering retirement in 15 years time will have a level of super that will supplement a part age pension.

Interesting you think we have extreme immigration control when over 140,000 immigrants arrived in Australia last year (admittedly down from 300,000 a few years back). Birth rate is still over 2.1 as well so not sure what you are getting at.

You're in Tasmania, which has a population the size of a small portion of Sydney. Come here and I can tell you the city is bursting at the seams. The last thing we need is more people, without the infrastructure to cope.

Tax rate is high because we hand out too many concessions to old people. Taxes on super should be raised as a matter of intergenerational equity more than anything else.

I apologise to OP as this thread has turned into a discussion about social and economic issues and has strayed from answering the original question lol.

Marty998, hopefully you aren't taking anything personally. Living in Tasmania doesn't mean I don't understand population density. I've added some links to my points below as I think they make for good reading if you're interested, some of them are old and I'm not going to look for the absolute latest figures as I'm just trying to show the trends.
 
You are correct in that old people will die eventually. However you must surely concede that people are living longer. We have an aging population, living longer, with most of those expecting/needed social security. If the average person retires at 65 and lives to 80/90 that's 15-25 years of social security and some assistance from superannuation. You must remember that super is a relatively new addition to our society, 1976 I think, with the average Australian super balance of $350,000ish for males at retirement age today and half that for females as of 2013. (http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/4125.0main+features1230Jan%202013). So the majority of people retiring in the near future wont have really had the benefits of making an informed choice about how they manage their superannuation. I would bet money on today's younger population having much larger super balances when they retire than those currently about to, and not just because of government mandated superannuation guarantee % increases. 

If we assume each retiree has a paid off home (which many don't) and gets 4% drawing on their super $14,000 (for men) and $7,000 (for women) and we assume the "traditional" view that they are a couple. That's $21,000 per annum in income. Now add the part pension (I calculate it at about $1,000 per fortnight for a couple after taking their earning income into consideration) for a grand total of $47,000 per annum.

That's the average.

So $13,000 part pension (that's not even the full pension!) per pensioner per annum for 15-25 years. A growing aging population, 2.2m over 65 in 2015 (http://www.abs.gov.au/ausstats%5Cabs@.nsf/mediareleasesbyCatalogue/72D4A8F0C7957E85CA257A6A0012F5A0)  that's up 400,000 from 2010. 

"In 2013-14, an estimated $39.5 billion will be spent on the Age Pension, benefitting 2.4 million recipients. Expenditure on the Age Pension is currently growing at 7 per cent per year"
"Age Pension expenditure is expected to continue to increase largely as a result of an ageing population, increased life expectancies and benchmarking to the Male Total Average Weekly Earnings benchmark"
(http://www.ncoa.gov.au/report/phase-one/part-b/7-1-age-pension.html)

Based on that report the number of part pensions is expected to rise, and full pensions to fall.

Now I agree that we should reduce some concessions or find better alternatives, what those are I don't know. But is sure seems to me that taking them off those who need them least, i.e. politicians and the super wealthy makes more sense. Hopefully more people start considering superannuation as rather important and paying attention to how they can use it but that wasn't really what the OP was looking for, or what my original point was.

As for the immigration issue;

We need more "working" "tax paying" people to offset the expected decline, irrespective of infrastructure, there are much bigger cities in the world that are capable of handling the needs of their inhabitants. I understand the generational frustration that oldies wont downsize, but at the same time I understand their view as well. Who wants to leave a home they potentially bought whilst young, raised their kids in and earned?

http://www.taxreview.treasury.gov.au/content/ConsultationPaper.aspx?doc=html/publications/Papers/Retirement_Income_Consultation_Paper/Chapter_6.htm

Whilst this paper is from 2008, it highlights the expected decreasing in working population over time from 5 working people per pensioner today to 2.1 per pensioner by 2047. 

Tax rates are not high because we hand out too many concessions to old people. There are more factors in play, including really inefficient bureaucracy and  dumb government spending. Honestly I don't begrudge the elderly from trying to get the best out a system that in all fairness they paid taxes into and left a government to run, but I think its a little unfair to blame the previous generation for todays problems. It just goes around in circles. We should be the generation that just tries to do better and doesn't pass the buck, regardless of who could be to blame.

Anyway, that's my thoughts on the matter. I'll leave it there. Happy to chat away on another thread or if you PM me

urbanista

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Re: Australian Investment Advice
« Reply #19 on: September 15, 2016, 10:12:00 PM »
Now I agree that we should reduce some concessions or find better alternatives, what those are I don't know. But is sure seems to me that taking them off those who need them least, i.e. politicians and the super wealthy makes more sense.

Thing is, the government may increase taxes on super or they may not. They may increase the preservation age or may not. The probability of both events is less than 100%.

Meanwhile, there is a 100% certainty that I am paying extra 24% income tax on any money I could sacrifice into super but choose not to. Plus 24% extra tax on any dividends from that money.

It seems to me that a rational person should prefer option 1 to option 2. I salary sacrifice up to a maximum.

Also, super can be released earlier on financial hardship grounds, maximum $10,000 per year per individual (after payment of penalty tax). I know people who did that, all you need to do is to receive the dole for 26 weeks.

Read here:

http://www.superguide.com.au/accessing-superannuation/severe-financial-hardship

https://www.humanservices.gov.au/customer/services/centrelink/early-release-superannuation

For me personally, super is a great legal way to avoid 24% income tax. Wish I could sacrifice more.

urbanista

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Re: Australian Investment Advice
« Reply #20 on: September 15, 2016, 10:26:27 PM »

http://www.taxreview.treasury.gov.au/content/ConsultationPaper.aspx?doc=html/publications/Papers/Retirement_Income_Consultation_Paper/Chapter_6.htm

Whilst this paper is from 2008, it highlights the expected decreasing in working population over time from 5 working people per pensioner today to 2.1 per pensioner by 2047. 

This is relevant for age pension, but how is it relevant for superannuation?

Superannuation is a target to raise taxes not because we are short of money but because current superannuation system is grossly unfair. Current system promotes even higher wealth inequality, where rich becomes richer. So I agree that some sort of taxes should be imposed, it is ridiculous that super income is completely fax free with no threshold. It only makes sense to start charging taxes on very high income from super because it is fair (all imo, of course).

steveo

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Re: Australian Investment Advice
« Reply #21 on: September 16, 2016, 01:47:55 AM »
I disagree that people close to retirement age have to work longer and longer. All they need to do is to downsize their house, the prices for detached houses are beyond ridiculous.

Also, it doesn't make any economic sense to increase the super preservation age. People who would otherwise use their super, would have to go on the dole, while super would go to their children upon death. It is very hard to force someone over 60 yo to work if they don't want to. Paid off house plus dole is enough to get through to the age when super will be available, even if it is 75.

Entitlement mentality is hard to shake in many oldies... spoke to one last week who downsized. She had to find a much nicer apartment than the house she was living in. Wanted to spend as much as possible so she could get the full pension.

She just could not see that she would be better off freeing up the capital. Maybe she could but wanted to keep the capital for inheritances for her family and live off the taxpayer in the meantime. As a taxpayer, I cried because my taxes are needlessly higher. As a lover of maths, I cried because she couldn't do the sums, and has probably made a few self defeating decisions in her lifetime in order to arrive at this position as well.

Or like I said maybe she did do the sums and is taking everyone for a ride.

My parents are self-funded retirees but so many of their friends get part pensions and they live in multi-million dollar houses. 2 people living in a house in Paddington and getting the pension. They complain about how little money they have as well.

Crazy !

steveo

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Re: Australian Investment Advice
« Reply #22 on: September 16, 2016, 01:49:35 AM »

http://www.taxreview.treasury.gov.au/content/ConsultationPaper.aspx?doc=html/publications/Papers/Retirement_Income_Consultation_Paper/Chapter_6.htm

Whilst this paper is from 2008, it highlights the expected decreasing in working population over time from 5 working people per pensioner today to 2.1 per pensioner by 2047. 

This is relevant for age pension, but how is it relevant for superannuation?

Superannuation is a target to raise taxes not because we are short of money but because current superannuation system is grossly unfair. Current system promotes even higher wealth inequality, where rich becomes richer. So I agree that some sort of taxes should be imposed, it is ridiculous that super income is completely fax free with no threshold. It only makes sense to start charging taxes on very high income from super because it is fair (all imo, of course).

I think some people can have huge incomes but because it's via Super it's tax advantaged. They should set a limit for Super.

misterhorsey

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Re: Australian Investment Advice
« Reply #23 on: September 16, 2016, 02:04:31 AM »


My parents are self-funded retirees but so many of their friends get part pensions and they live in multi-million dollar houses. 2 people living in a house in Paddington and getting the pension. They complain about how little money they have as well.

Crazy !
[/quote]

Yeah, they're taking the piste.

I do symphathise with poorer oldies who live in former slums/now expensive inner city n'hoods however.  They had the foresight to buy into cheap neighbourhoods, but are now cash poor, can't afford to upgrade renovate their houses, and meanwhile the cheap shops and supermarkets are replaced by cafes and boutiques  No doubt crime probably went down however.


Eucalyptus

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Re: Australian Investment Advice
« Reply #24 on: September 16, 2016, 02:30:08 AM »
I agree with the others that say not to put extra into Super.

At 33 that's 27 years of compounding. That's a lot, even if you were to say FIRE in another ten to 15 years time. Currently the compulsory employer contributions are 9.5%. From 2021 its meant to increase until it hits 12% in 2025. That won't make a big difference especially to older members of this forum who are closer to FIRE, but to younger members it will be very useful, and sways the equation further away from Salary Sacrificing super. 12% without taxes, say for 15 early working years before FIRE, pretty much guarantees your Super will be incredible (would be well over half a million in Super by age 60, just from say 15 years of working from age 22, at a below average salary of $60k).

And now I digress from the OP further :-)

I'd be very surprised if the age at which you can start withdrawing from Super increases much in the future. Particularly with how much of the recent parliamentary debate has played out. Conservatives would be very against it, and I think Liberal (left of centre) leaning politician's also. With increases in contributions (as I mentioned), those in their twenties now, will have a lot of Super even by the current age. Increasing the withdrawal age will create a class of older people with employment difficulties, that are otherwise very wealthy in their untouchable super accounts, with super accounts that will compound further, and that they will never be able to spend down! Pretty pointless. Would increase burden on social security payments (eg Newstart, or, age Pension, unless they also raise the age of that, but that just shifts the burden to Newstart).



misterhorsey

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Re: Australian Investment Advice
« Reply #25 on: September 16, 2016, 03:51:51 AM »
I agree with the others that say not to put extra into Super.

...would be well over half a million in Super by age 60, just from say 15 years of working from age 22, at a below average salary of $60k...


true, half a million is a big number.  But what would it be worth in real terms when that 22 year old turns 60 in 2058.  Exactly how many long overdue Marty McFly hoverboards would that be able to buy?

I'm not disparaging the effect of compounding. Rather, it's hard to appreciate how much it would actually be worth.

My super seems to have done very little after 15 years of full time work.  It had to fend off the rapacious fees of MLC and others before I woke up to that nonsense.  But I understand the magic of compounding happens near towards the end of the rainbow rather than the middle.


marty998

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Re: Australian Investment Advice
« Reply #26 on: September 16, 2016, 05:59:50 AM »
Nothing personal taken Chris-93. I tend to agree with many of your points made, except for the one where you say we need more tax paying immigrants to pay for old people's social security.

The wealthiest cohort in Australia are the 55+ generation. They should pay for their own welfare.


Eucalyptus

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Re: Australian Investment Advice
« Reply #27 on: September 16, 2016, 08:57:36 AM »
I agree with the others that say not to put extra into Super.

...would be well over half a million in Super by age 60, just from say 15 years of working from age 22, at a below average salary of $60k...


true, half a million is a big number.  But what would it be worth in real terms when that 22 year old turns 60 in 2058.  Exactly how many long overdue Marty McFly hoverboards would that be able to buy?

I'm not disparaging the effect of compounding. Rather, it's hard to appreciate how much it would actually be worth.

My super seems to have done very little after 15 years of full time work.  It had to fend off the rapacious fees of MLC and others before I woke up to that nonsense.  But I understand the magic of compounding happens near towards the end of the rainbow rather than the middle.

That half a million takes the effects of inflation into account. Half a million relative to today's dollars.

misterhorsey

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Re: Australian Investment Advice
« Reply #28 on: September 16, 2016, 09:01:06 AM »
in that case, sign me up!



gearb0x

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Re: Australian Investment Advice
« Reply #29 on: September 16, 2016, 06:05:08 PM »
I myself am investing into the High growth fund, dividends paid out in July of 3.2% which was nice.


Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.


bam, i am following a similar course, using value averaging (not DCA) into the high growth fund to grow my stash. So much easier, set and forget and i even get to play with spreadsheets

as for super, when pollis start referring to your super as a "national asset" it really makes you think twice about putting in anything voluntarily

DavidAnnArbor

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Re: Australian Investment Advice
« Reply #30 on: September 16, 2016, 06:40:30 PM »
I don't mean to be silly but do Australians really talk in the manner like in that tv show, "Ja'mie: Private School Girl ?"

Eucalyptus

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Re: Australian Investment Advice
« Reply #31 on: September 16, 2016, 09:22:24 PM »
I don't mean to be silly but do Australians really talk in the manner like in that tv show, "Ja'mie: Private School Girl ?"

It depends on where in Australia you are from.
Accents are either Ja'mie, Crocodile Dundee, Steve Irwin, Hugh Jackman, or Nicole Kidman.

Grogounet

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Re: Australian Investment Advice
« Reply #32 on: September 16, 2016, 10:34:09 PM »
I myself am investing into the High growth fund, dividends paid out in July of 3.2% which was nice.


Ignore Super, at this stage the major risk is government meddling (expect that you wont be able to access it until your 75 and it'll be taxed to buggery to pay for social security) and its locked away for far too long. Put your funds into Aussie Super's growth option and forget about it. Let it grow with just employer contributions.


I really liked the debate.
Because we don't know the future, I have decided to diversify my views on this. Because I've got no idea what will be next (same as returns in general), I diversify: Some in super (sacrifice), some outside.
In any case, in the long haul, you win.

bam, i am following a similar course, using value averaging (not DCA) into the high growth fund to grow my stash. So much easier, set and forget and i even get to play with spreadsheets

as for super, when pollis start referring to your super as a "national asset" it really makes you think twice about putting in anything voluntarily

Grogounet

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Re: Australian Investment Advice
« Reply #33 on: September 16, 2016, 10:34:53 PM »
And tax advantages are too good to be ignored

deborah

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Re: Australian Investment Advice
« Reply #34 on: September 17, 2016, 03:52:53 AM »
I think some of this talk is very silly. Let's look at it...

The wealthiest cohort in Australia are the 55+ generation. They should pay for their own welfare.
You would HOPE that the wealthiest cohort were the 55+ generation - they have worked for 35+ years, and SHOULD have something to show for it. All of us in MMM are working towards financial independence, and saving up for it. As we MMMs are getting older, we should have more wealth. Superannuation is, by its nature, forcing everyone to become wealthier. It's like when people say that the 55+ people tend to earn more - well that's also reasonable because they have gradually become more proficient at their jobs (to a certain point). Very few people accept that they will be earning the same when they have had 10 years experience as they would when they have no experience at all - because they have got better at the job. The fact is that people gradually earn more towards their 40's (when more experience really doesn't pay extra - there's usually not much difference between 10 years experience and 20) and then stagnate unless they become CEOs etc. who tend to earn more the older they are. That means that the 55+ cohort have a more diverse earning capacity than younger workers, and that their average earning capacity is vastly increased by what the high flyers earn.

And women (who tend to come back into the workforce at this late stage), are also earning more than they ever have - even if it is a pittance because they work part time and are not paid as much anyway. Of course, the corollary of this is that there are a lot of 55+ who don't have much, and who really need the pension. Unfortunately, there are a few people who are living in high cost houses and receiving a part pension. But they are the vast minority.
I disagree that people close to retirement age have to work longer and longer. All they need to do is to downsize their house, the prices for detached houses are beyond ridiculous.

Also, it doesn't make any economic sense to increase the super preservation age. People who would otherwise use their super, would have to go on the dole, while super would go to their children upon death. It is very hard to force someone over 60 yo to work if they don't want to. Paid off house plus dole is enough to get through to the age when super will be available, even if it is 75.

Entitlement mentality is hard to shake in many oldies... spoke to one last week who downsized. She had to find a much nicer apartment than the house she was living in. Wanted to spend as much as possible so she could get the full pension.

She just could not see that she would be better off freeing up the capital. Maybe she could but wanted to keep the capital for inheritances for her family and live off the taxpayer in the meantime. As a taxpayer, I cried because my taxes are needlessly higher. As a lover of maths, I cried because she couldn't do the sums, and has probably made a few self defeating decisions in her lifetime in order to arrive at this position as well.

Or like I said maybe she did do the sums and is taking everyone for a ride.

My parents are self-funded retirees but so many of their friends get part pensions and they live in multi-million dollar houses. 2 people living in a house in Paddington and getting the pension. They complain about how little money they have as well.

Crazy !
It is very difficult to move when you are old. Your community is a big part of your knowledge, and if you aren't going to the same shops, meeting people in the same neighbourhood, even using the same rooms in the same house, your cognitive ability disappears. I saw it every time as each of my relatives of my grandparents generation moved to somewhere different. They immediately became less alert and slid downhill alarmingly. The same happened to my aunt. Although she had dementia, she recognised me the week before she went into a nursing home, but never after that. We need to work out ways of keeping older people in their neighbourhood while making the housing stock more appropriate for them. I had a great aunt who lived to 105. She was in her three bedroom house (that she moved to when she married at 18) until she was 101. She had little eye sight and she was deaf, and the house didn't have any of the latest gadgets, so it was a real struggle for her to live there, but she was lost when she moved into a nursing home for respite. Every relative I have visited in these circumstances asks constantly when they are going home.

I often see people complaining that "oldies" are underutilising housing stock (and I agree that they are), but it is all whinging, rather than putting forward constructive ideas for keeping them in their neighbourhood.

I agree with Marty about the preservation age not changing much. Too many people are on newstart for a lot of their 50s because no-one will employ them after they have lost a job when they are over 50. Tradies often find that their back gives out by their mid-fifties too.

A lot of the problems the over 55s have is that they haven't accumulated as much as they need in super because it simply wasn't available to them. The super guarantee came in in the 1990s, and was only 3%. One of the reasons I see for many of the stupidly over the top concessions we have in the super system is to give such people the ability to add a bit extra. Unfortunately the concessions were monumentally stupid, and the great majority couldn't take advantage of them, while the wealthy could.

And on the old saw that people take lump sums from their super (which they don't) - see a recently released longitudinal study from the CSIRO http://www.superresearchcluster.com/__data/assets/pdf_file/0004/578272/Superannuation-Drawdown-Behaviour-An-Analysis-Of-Longitudinal-Data-WP-2016-04.pdf

marty998

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Re: Australian Investment Advice
« Reply #35 on: September 17, 2016, 08:56:12 AM »
Yes I agree with many of those points deborah.... which is why I am a firm believer in a reverse mortgage type scheme. Keeps the oldies in their homes and frees up their capital in a fair and efficient manner.

Here is a link to the stat I was taking about (2011-12 data). Scroll to table S7. It shows the highest net worth cohort is the 55-64 no kids group with $1,266,000 mean net worth. The 65+ cohort also has the highest outright home ownership % of 82.1%.

http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/6554.0Main%20Features22011%E2%80%9312?opendocument&tabname=Summary&prodno=6554.0&issue=2011%9612&num=&view=

urbanista

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Re: Australian Investment Advice
« Reply #36 on: September 18, 2016, 07:53:24 PM »
It is very difficult to move when you are old. Your community is a big part of your knowledge, and if you aren't going to the same shops, meeting people in the same neighbourhood, even using the same rooms in the same house, your cognitive ability disappears. I saw it every time as each of my relatives of my grandparents generation moved to somewhere different.

I wholeheartedly agree if you are talking about your parents (or grandparents) generation, i.e. 70+ y.o.

However, I was talking about 60y.o. in the context of forcing them to work longer by increasing the preservation age (currently sits at 60). My point was that increasing the preservation age would not result in people working longer. Instead, 60 y.o. people would exhaust their out-of-super assets, then either go on the dole or downsize their homes (or both) while waiting for the super to become available. Therefore, it is a very silly economic policy, imo.

urbanista

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Re: Australian Investment Advice
« Reply #37 on: September 18, 2016, 07:58:03 PM »
Yes I agree with many of those points deborah.... which is why I am a firm believer in a reverse mortgage type scheme. Keeps the oldies in their homes and frees up their capital in a fair and efficient manner.

Actually, this is the third option in case preservation age increases in the future.

To sum it up, we have 3 options available to us if super is suddently not available when we plan for it to be available (i.e. at 60):
1. Dole with early release of super $10K each year.
2. Downsize the house.
3. Reverse mortgage.

Or combination of the all three.

Therefore, I don't buy into the media scares about the super and salary sacrifice as much as possible.

deborah

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Re: Australian Investment Advice
« Reply #38 on: September 18, 2016, 09:26:18 PM »
Yes I agree with many of those points deborah.... which is why I am a firm believer in a reverse mortgage type scheme. Keeps the oldies in their homes and frees up their capital in a fair and efficient manner.

Here is a link to the stat I was taking about (2011-12 data). Scroll to table S7. It shows the highest net worth cohort is the 55-64 no kids group with $1,266,000 mean net worth. The 65+ cohort also has the highest outright home ownership % of 82.1%.

http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/6554.0Main%20Features22011%E2%80%9312?opendocument&tabname=Summary&prodno=6554.0&issue=2011%9612&num=&view=
As I said, I agree that they SHOULD be the wealthiest cohort. But look at the data - it means they have almost no worth apart from their house, and even that figure is being made higher than reality because it is a mean rather than a median, and we have a few very high wealth individuals in that age bracket.

It is very difficult to move when you are old. Your community is a big part of your knowledge, and if you aren't going to the same shops, meeting people in the same neighbourhood, even using the same rooms in the same house, your cognitive ability disappears. I saw it every time as each of my relatives of my grandparents generation moved to somewhere different.

I wholeheartedly agree if you are talking about your parents (or grandparents) generation, i.e. 70+ y.o.

However, I was talking about 60y.o. in the context of forcing them to work longer by increasing the preservation age (currently sits at 60). My point was that increasing the preservation age would not result in people working longer. Instead, 60 y.o. people would exhaust their out-of-super assets, then either go on the dole or downsize their homes (or both) while waiting for the super to become available. Therefore, it is a very silly economic policy, imo.
But how long does it take you to become part of a community in the first place?

If you have school age kids, it is easy, but I don't think people realise just how long it takes. I think 10 years - and that takes it back to 60+ from 70+

I went to seven different primary schools because my parents moved around a lot, and it took them about that long when they retired to somewhere completely different, even though they were quite proficient at becoming part of any new community.
« Last Edit: September 18, 2016, 09:29:33 PM by deborah »

urbanista

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Re: Australian Investment Advice
« Reply #39 on: September 19, 2016, 06:35:01 AM »
People don't necessarily need to move far away. Downsizing from a house to a two bedroom apartment can do the trick for many people.

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Re: Australian Investment Advice
« Reply #40 on: September 19, 2016, 02:22:12 PM »
The older people I have known have needed flat surfaces (no stairs, no hills). Almost all apartments are not appropriate for them to move to. Believe me, I have spent a lot of time with people looking at these. And most neighbourhoods do not have appropriate accommodation in them - especially the ones where the houses cost the sorts of prices you are quoting above.

urbanista

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Re: Australian Investment Advice
« Reply #41 on: September 19, 2016, 04:00:17 PM »
When did you look into it, and what was the area? At the moment in Melbourne there are apartments virtually everywhere, most of the new buildings have lifts. My mother is 60, she lives in the house but can't maintain the backyard, so we are looking to do exactly that: downsize to a smaller place. Her house is 40km out of Melbourne CBD, is very small 3 bedroom on 520sqm land so in no way a large place. Even there she could get a two bedroom single storey unit and free up 100K.

Where I live, any house sells for an absolute minimum 850K. Move to the next door suburb, virtually across the major road, and one can get 2 bedroom single storey unit with a backyard or very nice apartment for under 500K, so free up 300K after transaction costs.

Maybe because I grew up in Europe, where everyone live in , you know, apartments, I don't understand the problem.

GT

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Re: Australian Investment Advice
« Reply #42 on: September 19, 2016, 04:39:35 PM »
Maybe because I grew up in Europe, where everyone live in , you know, apartments, I don't understand the problem.

You've got to get past the Great Australian Dream we were brought up on.  The whole quarter acre block, house, garden, hills hoist, BBQ.

HappierAtHome

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Re: Australian Investment Advice
« Reply #43 on: September 19, 2016, 07:07:01 PM »
The older people I have known have needed flat surfaces (no stairs, no hills). Almost all apartments are not appropriate for them to move to. Believe me, I have spent a lot of time with people looking at these. And most neighbourhoods do not have appropriate accommodation in them - especially the ones where the houses cost the sorts of prices you are quoting above.

I know this is OT, but wanted to comment as it's something I find hard to believe, but does in fact appear to be true (in Perth). I didn't even notice how elderly or disabled-unfriendly our old flat was until an aunt with very bad knees (she gets an ACROD sticker to park in disabled bays) needed to visit. You could enter the building either by walking up a flight of stairs to the front door, or by coming in through the garage. Of course the driveway into the garage was too steep for an infirm or injured person to easily walk up. Then even if you took the lift to our floor, there were a couple of steps (with no handrail) at two different points along the walkway between the lift and our flat.

Once I noticed this, I started looking out for it at viewings of other flats. Even the brand-new ones built next door to us were not wheelchair friendly / had steps at various points even if using the lift.

A guy in my office bought a flat in a newly-built building recently and there is NO LIFT. He climbs eight flights of stairs to and from his place, which is great for a young fit guy, but what if he sprains his ankle? At first I thought he was joking. Nope. I guess no one with babies or young children, or elderly people, can ever live there.

urbanista

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Re: Australian Investment Advice
« Reply #44 on: September 19, 2016, 08:47:50 PM »
A guy in my office bought a flat in a newly-built building recently and there is NO LIFT. He climbs eight flights of stairs to and from his place, which is great for a young fit guy, but what if he sprains his ankle? At first I thought he was joking. Nope. I guess no one with babies or young children, or elderly people, can ever live there.

That makes me laugh as my mum and dad raised two kids in a 1 bed apartment up on the 5th floor (no lift), and my grandfather lived and died at the age of 92 in exactly the same apartment.

Guess this is a reason to give thanks to how lucky we are here in Australia.

HappierAtHome

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Re: Australian Investment Advice
« Reply #45 on: September 19, 2016, 08:54:31 PM »
A guy in my office bought a flat in a newly-built building recently and there is NO LIFT. He climbs eight flights of stairs to and from his place, which is great for a young fit guy, but what if he sprains his ankle? At first I thought he was joking. Nope. I guess no one with babies or young children, or elderly people, can ever live there.

That makes me laugh as my mum and dad raised two kids in a 1 bed apartment up on the 5th floor (no lift), and my grandfather lived and died at the age of 92 in exactly the same apartment.

What on earth did they do when someone was injured and couldn't climb the stairs?

deborah

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Re: Australian Investment Advice
« Reply #46 on: September 19, 2016, 09:06:33 PM »
The other problem with apartments is that most older people I know need a little bit of garden - enough for 3 or 4 roses (well 30 or 40 in my mother's case), or fuchsias... - because they have always lived on a house block and pottering around in the garden is one of the few enjoyable things they can still do.

My parents are currently downsizing. Visualise their existing house... mum has put those sweet little box hedges around every bed (front and back), has no more than 30cm of garden bed without a rose plant (except in the vegetable garden), a few fruit trees, birches, a couple of enormous palm trees... It is one of the most beautiful gardens in the suburb, if not the city where they live (one of the difficulties in selling the house). It was all getting too much and she had to lie down for several hours after each half hour stint in the garden. The new place has no garden (well, it had a couple of yuccas and a New Zealand Flax, but mum doesn't like them, so they have been chopped down, and it still has a gum tree in the back). She was going to put three or four roses in the front. I know from various phone conversations that many more have been planted. And she is talking about a vegetable garden...

urbanista

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Re: Australian Investment Advice
« Reply #47 on: September 19, 2016, 09:22:01 PM »
A guy in my office bought a flat in a newly-built building recently and there is NO LIFT. He climbs eight flights of stairs to and from his place, which is great for a young fit guy, but what if he sprains his ankle? At first I thought he was joking. Nope. I guess no one with babies or young children, or elderly people, can ever live there.

That makes me laugh as my mum and dad raised two kids in a 1 bed apartment up on the 5th floor (no lift), and my grandfather lived and died at the age of 92 in exactly the same apartment.

What on earth did they do when someone was injured and couldn't climb the stairs?

Rule number 1: don't get injured.

Otherwise Family would carry them around. I am not saying it was a very good life but that's how 50 million people lived / still many millions live in my home country.

Grogounet

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Re: Australian Investment Advice
« Reply #48 on: September 20, 2016, 11:07:10 PM »
Couldn't agree more. The issue comes from the fact that we don't know how to live normally anymore. We don't know what tough times are.

We have a cleaner in our place (Yes!) and he rose his eye brows when he saw we were a family of 4 in 70 sqm. Man, I use to leave in 50 sqm when younger and one bedroom with my younger brother until I left home at 19. I haven't died of it and it has thought me a lot of things along the way.

Not 1 month baby have they own bedroom, we buy 4WD at the first child, etc etc..

As soon as you travel, you start realize how crazy the life is here (and good!).

Anything wrong about that as long as you're prepared to downsize if needed. Here is the trick, no one is prepared to downsize, even if needed.

steveo

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Re: Australian Investment Advice
« Reply #49 on: September 21, 2016, 01:16:13 AM »
As soon as you travel, you start realize how crazy the life is here (and good!).

I couldn't just let this one pass. I hardly every travel. I realise how we good we have it. From what I can see most people travel and spend more and more and more and so on.

One of the soccer mums whose boy plays soccer with my boy is fed up with work but planing another holiday for herself. I think they go on one or two per year. She is also thinking of getting a pool.