Chasing better super returns

Discussion in 'Superannuation, SMSF & Personal Insurance' started by Possumcreek, 2nd Jun, 2018.

Join Australia's most dynamic and respected property investment community
Tags:
  1. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    I'm with First State Super, 53y.o., looking to retire at 60.
    Investigating options with better returns such as Hostplus or Australian Super.
    What do I need to be aware of esp in regards CG? Would I need to pay CG on transferred funds, etc?
    Any thoughts would be appreciated.
     
  2. pwnitat0r

    pwnitat0r Well-Known Member

    Joined:
    27th Nov, 2016
    Posts:
    323
    Location:
    Sydney
    No capital gains tax on rollover of funds.

    May I ask what your balance is? A SMSF may be worthwhile depending on your balance.
     
  3. Zenith Chaos

    Zenith Chaos Well-Known Member

    Joined:
    10th Jul, 2015
    Posts:
    1,673
    Location:
    Sydney
    Past returns are not an indicator of future returns.
     
    Air_Bender likes this.
  4. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    27,103
    Location:
    Sydney or NSW or Australia
    Assets need to be sold to transfer (pay cash) to your next super fund, are you sure that there'd be no CGT payable (at 15%)?
     
  5. pwnitat0r

    pwnitat0r Well-Known Member

    Joined:
    27th Nov, 2016
    Posts:
    323
    Location:
    Sydney
    The unit value calculated daily takes everything into account - including franking credits paid at 30% tax rate, 1/3 discount for CGT > 12 months, etc.. the unit value is the figure you receive. I'm sure that with all the incoming funds due to SGC they don't need to sell anything to pay someone.
     
  6. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    Not sure what you mean with this line sorry.

    Suffice to say that I have read that unless you have over 200K in super it is not worth going down the SMSF track due to costs.
     
  7. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    Wondering about having an each way bet and just opening a second super fund. I understand they keep harping on about excess fees. What do others think about having more than one super?
    I recently met a super presenter who had THREE!
     
  8. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    Thanks for the replies above BTW :)
     
  9. The Falcon

    The Falcon Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    3,423
    Location:
    AU
    You can rollover from corporate to industry funds ( and vice versus) without triggering CGT

    If it was me, i would find a large, low cost (this is important) industry fund and rollover, like for like you will be ahead of the corporate fund due to lower cost.

    The asset allocation decision however is a different matter and I cannot advise on that.

    Not licensed etc.
     
    Joynz likes this.
  10. PandS

    PandS Well-Known Member

    Joined:
    14th Feb, 2017
    Posts:
    1,165
    Location:
    NSW
    you should have a decent record before setting up your own SMSF though, it sound simple and easy but to get consistent return required some work and a lot of red tape.

    There is a reverse flow of money going the other way in recent year, after an exodus since 2013 to SMSF and after 5 years most people cant make a decent return, there is a net flow from SMSF back to Industry fund.
     
  11. mikey7

    mikey7 Well-Known Member

    Joined:
    30th Mar, 2016
    Posts:
    1,173
    Location:
    Sydney, Brisbane
    Why would you want to pay 2x or 3x the fees? Waste of money..
    My employer automatically created a First State account for me. I promptly closed it and directed everything into Australian Super.
     
  12. Zenith Chaos

    Zenith Chaos Well-Known Member

    Joined:
    10th Jul, 2015
    Posts:
    1,673
    Location:
    Sydney
    1. Why not have multiple super accounts? Fees are compounded for each. Reduce fees by combining into a single account.

    2. My son recently started casual work. Employer started a Hesta account for him but I immediately created a Hostplus account using the index balanced fund. I chose the cheapest fund for my son because his earnings are meagre but may consider a higher growth option if the market crashed.

    3. I'm in Sunsuper with Australian and International index funds split 50/50

    Conclusion - for Super my thinking is that fees should be reduced to a minimum and growth to a maximum unless less than n years to retirement where n is determined from personal risk appetite.

    Not licensed to give advice.
     
    Last edited: 6th Jun, 2018
  13. pwnitat0r

    pwnitat0r Well-Known Member

    Joined:
    27th Nov, 2016
    Posts:
    323
    Location:
    Sydney
    Every week the super funds receive an inflow of funds from the compulsory superannuation payments employers must make.. when someone withdraws their funds, they don't have to sell off any assets to pay that person out.

    I've got a SMSF up and running with less than $150k. My costs for accountant and audit last financial year were $1k. My investment management fees are 0%, I only pay performance fees.
     
  14. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    Wow that sounds competitive. The article by Sam Henderson in April edition of Money mag reckons expect a cost of $2-3K and that is why he suggests you would be best to have a super balance in excess of 200K for SMSF.
     
  15. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    Since comparing the super funds I notice they all charge according to how much is in the fund plus maybe $52-100.
    So I figure if you spread over 2 funds a balance that would otherwise be in a single one it is only costing you that extra admin fee and your money is spread over 2 different management styles.
    Correct me if I am wrong.
     
  16. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    I was looking at Hostplus but despite what the Barefoot Investor says about it being the cheapest it seems to cost you the most unless you go for the indexed balanced fund which doesn't do as well as their other balanced option (default) which comes at a price.
    Someone like myself who may like to spread their balance through other options pays dearly.
    Unless I'm missing something.
     
  17. pwnitat0r

    pwnitat0r Well-Known Member

    Joined:
    27th Nov, 2016
    Posts:
    323
    Location:
    Sydney
    Ynot and Nodrog like this.
  18. Nodrog

    Nodrog Well-Known Member

    Joined:
    28th Jun, 2015
    Posts:
    11,379
    Location:
    Buderim
    After Sam Henderson’s appearance at the royal commission he might be happy to accept much less now:D.
     
    Ynot likes this.
  19. RS Gumby

    RS Gumby Well-Known Member

    Joined:
    1st Apr, 2016
    Posts:
    241
    Location:
    victoria
    I'm 55 and just changed my super to Hostplus Balanced Fund. It's returning 11.8%pa over 5 years and 13.2%pa this past year. It's won Money magazines best balanced Super fund in 2018 and have been top 3 for many years. I'm looking to retire in 5 to 10 years so was looking for a good fund that produces and protects, I'm happy with my choice
     
    Ynot and Anne11 like this.
  20. Possumcreek

    Possumcreek Well-Known Member

    Joined:
    28th Apr, 2017
    Posts:
    85
    Location:
    Wangaratta, VIC
    How are you finding the fees?
    From what I can see fees for 50K in Balanced option is $803p.a. but with Australian Super it's $453. Both of them seem to have a good track record. Though Hostplus probably more so.
     
    Cadbury99 likes this.