Sent: 29-05-2012 13:38:02
In this issue:
Return to full article list
HomeFree weekly newsletterSelf Managed Super Fund ArticlesContact usLogin
The Size Of The Super Industry
This graph was published in the 2012 Federal Budget Papers and was produced by the Federal Treasury. It shows total super assets rising to almost $7 trillion over the next 25 years (by 2037) and the average retiree will have $440,000 in super assets by 2039 - or the equivalent of about $200,000 in today's dollars if inflation is an average of 3% over the intervening period.
This growth in the super industry (which the Government thinks will be 130% of the Australian economy's GDP) will have to be carefully managed and supervised.
Investor benefits will only be maximized if the super industry operates efficiently and accurately and costs are as low as possible and the potential for fraud is minimized.
The almost obsessive focus on investment capital values - to the willful blindness to the income an investment might pay - will also have to change. (On this point I believe some people are incapable of change but this is a separate issue.)
Many things can intervene with this expected size of total super assets. For example, we all know we're heading for a demographic problem where we have too many retirees and not enough workers. It may be that the Government and employers can't afford compulsory super and the aged pension costs.
Some of you might not think this sort of choice will become necessary. But I guess it all comes down to how big the economy is at the time and whether people of my generation expect to be retired for several decades as many current retirees demand.
Limited Recourse Borrowing Ruling Finalised
On another note the ATO have finalized the ruling that details its understanding has been released in its final form. Based on my initial reading of the ruling there doesn't appear to be too much new material in it but as always these documents demand close reading.
Income Stream Ruling
Finally just a note about this ruling, the ATO have released information which suggests the final version of this ruling will be issued about 6 June. You might recall that the draft version of this ruling was quite controversial. One of the main sticking points will be the start date of the final ruling. The draft suggested 1 July 2007. This is probably a little impractical. A key issue will be how closely the final ruling follows the draft and its start date.
Version 6.0 of my SMSF book is now available.
You can see all the changes that have been made between Version 5.1 and 6.0 (the latest edition).
You can look at the contents page at the following link: http://www.atcbiz.com.au/r.php?r=0mjd6ne
For details of the changes made from version 5 to version 6 visit: http://www.atcbiz.com.au/r.php?r=d5xcpch
As you'll see from the list there have been many changes.
Two purchase options are available - once only subscription - $55 inc GST - or an annual subscription will gives you access to all the updates made throughout the year ($120 inc GST). The book can be purchased at the following link: http://www.atcbiz.com.au/r.php?r=5a4agqb
This email is general in nature only and does not constitute or convey specific or professional advice. Legislation changes may occur quickly. Formal advice should be sought before acting in any of the areas discussed. Be aware that the information in these articles may become innaccurate with time. Responsibility is disclaimed for any inaccuracies, errors or omissions. Particular investments are neither invited nor recommended and hence this publication is not "financial product advice" as defined in Section 766B of the above legislation. All expressions of opinion by contributors are published on the basis that they are not to be regarded as expressing the official opinion of any other person or entity unless expressly stated. No responsibility for the accuracy of the opinions or information contained in the contributor's articles is accepted by any other person or entity. Copyright: This publication is copyright. If you wish to reproduce this article you require a license, which can be purchased here, to do so.