Superannuation

Tax on so-called 'super rich' could prove costly

By Chief Advocate Ian Henschke

In March the Labor Party announced a radical new policy. If elected it would close a “tax loophole” exploited by the rich.

It would reap $59 billion over 10 years by disallowing tax credits from Australian shares to be paid to people who had no income. Labor leader Bill Shorten said: “A small number of people will no longer receive a cash refund.”

One size does not fit all in retirement risk

National Seniors is concerned a proposed ‘one size fits all’ approach towards helping retirees better manage their financial risks in retirement may not suit everyone.

National Seniors last year made a submission to the federal Treasury, commenting on the initial proposal to develop regulation for new Comprehensive Income Products for Retirement (CIPRs). It is proposed super funds offer these products to help retirees better manage risks such as outliving their super.

Women still lagging in super

New research shows the average superannuation balances of intending retirees over the past decade for both men and women have more than doubled, but females remain well behind the male average.

The latest results from Roy Morgan Research’s Single Source Survey show the average superannuation held by women intending to retire in the next 12 months is $177,000, or equal to only 57.3 per cent of the male average ($309,000). An estimated 392,000 people intend to retire in the next 12 months.

Early release of super on compassionate grounds

People may be able to get quicker access to their superannuation in times of need from next month.

Financial Services Minister Kelly O’Dwyer said from 1 July 2018, responsibility for the administration of the early release of superannuation benefits on compassionate grounds will be transferred from the Department of Human Services (DHS) to the Australian Taxation Office (ATO).

Longer lives demand super rethink

Australians have among the longest lifespans in the world, but are failing to plan financially for their later years, National Seniors Interim CEO Professor John McCallum said today.

National Seniors surveys over many years had consistently shown older Australians wanted regular, low-risk incomes in retirement.

“They want the equivalent of a ‘wage’ that gives them security and predictability,” Prof. McCallum told the Committee for Sustainable Retirement Incomes conference in Canberra.

The highs and lows of the 'Baby Boomer budget'

This week’s Federal Budget has delivered a mixed bag of initiatives for older Australians, according to National Seniors Chief Advocate Ian Henschke.

Mr Henschke said what was promoted as a “budget for Baby Boomers” fell short of expectations, but wasn’t without some bright spots.

The National Seniors policy team has put together the following summary of the budget from the perspective of seniors.

Employment

Top Australian super funds

Just under two thirds of superannuation fund members are satisfied with the performance of their fund, new research shows.

The Roy Morgan Superannuation Satisfaction Report revealed that in the six months to March 2018, average superannuation satisfaction was 61.1 per cent.

This was on par with the average satisfaction level for industry funds. Retail funds were below the average at 60.1 per cent and satisfaction with major retail funds ANZ, CBA, NAB and Westpac was lower again at 58.7 per cent. 

Labor not budging on dividend imputation tax plan

Opposition Leader Bill Shorten is refusing to back down on the dividend imputation policy despite a widespread backlash against Labor’s plans to abolish franking credit cash rebates for retiree investors.

The Labor leader last week rejected calls to water down the proposed policy, or exempt pensioners or those with modest self-managed superannuation funds.

Mr Shorten said Labor was braced for “a tough debate” and it was unfair that “a few people” could claim a tax refund when they had paid no tax.

ALP dividend changes need more consideration

National Seniors Australia has warned proposed ALP changes that would end cash refunds to retirees claimed through share dividend imputation could backfire.

Chief Advocate Ian Henschke said this week that the plan, designed to claw back $59 billion over 10 years from wealthy retirees, could hurt many full and part age pensioners who had been encouraged to diversify by including shares in their retirement portfolios.

Time out of workforce takes toll on women's super

Women will continue to retire with less super than men due to time out of the workforce and lost compound returns, a new study shows.

In a first of its kind, Industry Super Australia adviser and former Treasury retirement modelling head, Phil Gallagher, used data from the Australian Bureau of Statistics (ABS) to plot both pay and superannuation gaps by age and salary.

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