Funds report super returns for retirees

Source: Supplied

THE average retirement nest-egg has grown by more than 12 per cent so far this financial year, the strongest performance by superannuation funds since before the global financial crisis.

Two separate analyses have revealed median balanced superannuation funds - the most common variety - have soared by more than 12.5 per cent since July, the best result since 2007.

In the past decade, the average superannuation nest egg has grown 7.2 per cent each year.

That number more than halves to an average of just 3.2 per cent when the past five years of returns are calculated, with the GFC to blame.

But Chant West director Warren Chant said that with another quarter to go it appeared Australians were on track for pre-GFC double-digit growth in their retirement savings this financial year.

"This year looks as though it's going to be another really good year," he said. "It's been a terrific nine months and in the last 12 months and for the year to March, they've earned 11 per cent; for the nine months it's about 13 per cent."

Chant West said shares and listed property were the best performers in the March quarter - Australian shares increased 8 per cent.

Australian and global Real Estate Investment Trusts (REITs) increased by 5.3 per cent and 8.8 per cent respectively.

However bond markets weren't as successful, Australian and international bonds rose by just 0.2 per cent and 1.2 per cent respectively.

SuperRatings' research analyst Leo Tratras said fund members had a promising start to 2013 before experiencing a slight drop last month due to the banking woes in Cyprus.

"January and February were quite strong but in March there was only a small fall of 0.2 per cent," he said.

"It shouldn't come as a surprise given how strong the first few months of the year were; despite that, the quarterly performance was still up over 4 per cent."

SuperRatings figures found the median balanced option rose by 2.6 per cent in January and a further 2 per cent in February before falling by 0.2 per cent last month.

But Mr Tratras said the March result was a good one compared to the sharemarket's 2.2 per cent fall.

"When you compare that fall in the wider Australian sharemarket to the relatively small drop in super funds it's quite a good performance.

"The bad news isn't as bad as it could have been."

A majority of Australians have their retirement savings invested in their fund's default option, which is usually the balanced investment option that has growth-style assets between 60 and 76 per cent.

View the original article here

Funds report super returns for retirees

Source: Supplied

THE average retirement nest-egg has grown by more than 12 per cent so far this financial year, the strongest performance by superannuation funds since before the global financial crisis.

Two separate analyses have revealed median balanced superannuation funds - the most common variety - have soared by more than 12.5 per cent since July, the best result since 2007.

In the past decade, the average superannuation nest egg has grown 7.2 per cent each year.

That number more than halves to an average of just 3.2 per cent when the past five years of returns are calculated, with the GFC to blame.

But Chant West director Warren Chant said that with another quarter to go it appeared Australians were on track for pre-GFC double-digit growth in their retirement savings this financial year.

"This year looks as though it's going to be another really good year," he said. "It's been a terrific nine months and in the last 12 months and for the year to March, they've earned 11 per cent; for the nine months it's about 13 per cent."

Chant West said shares and listed property were the best performers in the March quarter - Australian shares increased 8 per cent.

Australian and global Real Estate Investment Trusts (REITs) increased by 5.3 per cent and 8.8 per cent respectively.

However bond markets weren't as successful, Australian and international bonds rose by just 0.2 per cent and 1.2 per cent respectively.

SuperRatings' research analyst Leo Tratras said fund members had a promising start to 2013 before experiencing a slight drop last month due to the banking woes in Cyprus.

"January and February were quite strong but in March there was only a small fall of 0.2 per cent," he said.

"It shouldn't come as a surprise given how strong the first few months of the year were; despite that, the quarterly performance was still up over 4 per cent."

SuperRatings figures found the median balanced option rose by 2.6 per cent in January and a further 2 per cent in February before falling by 0.2 per cent last month.

But Mr Tratras said the March result was a good one compared to the sharemarket's 2.2 per cent fall.

"When you compare that fall in the wider Australian sharemarket to the relatively small drop in super funds it's quite a good performance.

"The bad news isn't as bad as it could have been."

A majority of Australians have their retirement savings invested in their fund's default option, which is usually the balanced investment option that has growth-style assets between 60 and 76 per cent.

View the original article here

Funds report super returns for retirees

Source: Supplied

THE average retirement nest-egg has grown by more than 12 per cent so far this financial year, the strongest performance by superannuation funds since before the global financial crisis.

Two separate analyses have revealed median balanced superannuation funds - the most common variety - have soared by more than 12.5 per cent since July, the best result since 2007.

In the past decade, the average superannuation nest egg has grown 7.2 per cent each year.

That number more than halves to an average of just 3.2 per cent when the past five years of returns are calculated, with the GFC to blame.

But Chant West director Warren Chant said that with another quarter to go it appeared Australians were on track for pre-GFC double-digit growth in their retirement savings this financial year.

"This year looks as though it's going to be another really good year," he said. "It's been a terrific nine months and in the last 12 months and for the year to March, they've earned 11 per cent; for the nine months it's about 13 per cent."

Chant West said shares and listed property were the best performers in the March quarter - Australian shares increased 8 per cent.

Australian and global Real Estate Investment Trusts (REITs) increased by 5.3 per cent and 8.8 per cent respectively.

However bond markets weren't as successful, Australian and international bonds rose by just 0.2 per cent and 1.2 per cent respectively.

SuperRatings' research analyst Leo Tratras said fund members had a promising start to 2013 before experiencing a slight drop last month due to the banking woes in Cyprus.

"January and February were quite strong but in March there was only a small fall of 0.2 per cent," he said.

"It shouldn't come as a surprise given how strong the first few months of the year were; despite that, the quarterly performance was still up over 4 per cent."

SuperRatings figures found the median balanced option rose by 2.6 per cent in January and a further 2 per cent in February before falling by 0.2 per cent last month.

But Mr Tratras said the March result was a good one compared to the sharemarket's 2.2 per cent fall.

"When you compare that fall in the wider Australian sharemarket to the relatively small drop in super funds it's quite a good performance.

"The bad news isn't as bad as it could have been."

A majority of Australians have their retirement savings invested in their fund's default option, which is usually the balanced investment option that has growth-style assets between 60 and 76 per cent.

View the original article here

Funds report super returns for retirees

Source: Supplied

THE average retirement nest-egg has grown by more than 12 per cent so far this financial year, the strongest performance by superannuation funds since before the global financial crisis.

Two separate analyses have revealed median balanced superannuation funds - the most common variety - have soared by more than 12.5 per cent since July, the best result since 2007.

In the past decade, the average superannuation nest egg has grown 7.2 per cent each year.

That number more than halves to an average of just 3.2 per cent when the past five years of returns are calculated, with the GFC to blame.

But Chant West director Warren Chant said that with another quarter to go it appeared Australians were on track for pre-GFC double-digit growth in their retirement savings this financial year.

"This year looks as though it's going to be another really good year," he said. "It's been a terrific nine months and in the last 12 months and for the year to March, they've earned 11 per cent; for the nine months it's about 13 per cent."

Chant West said shares and listed property were the best performers in the March quarter - Australian shares increased 8 per cent.

Australian and global Real Estate Investment Trusts (REITs) increased by 5.3 per cent and 8.8 per cent respectively.

However bond markets weren't as successful, Australian and international bonds rose by just 0.2 per cent and 1.2 per cent respectively.

SuperRatings' research analyst Leo Tratras said fund members had a promising start to 2013 before experiencing a slight drop last month due to the banking woes in Cyprus.

"January and February were quite strong but in March there was only a small fall of 0.2 per cent," he said.

"It shouldn't come as a surprise given how strong the first few months of the year were; despite that, the quarterly performance was still up over 4 per cent."

SuperRatings figures found the median balanced option rose by 2.6 per cent in January and a further 2 per cent in February before falling by 0.2 per cent last month.

But Mr Tratras said the March result was a good one compared to the sharemarket's 2.2 per cent fall.

"When you compare that fall in the wider Australian sharemarket to the relatively small drop in super funds it's quite a good performance.

"The bad news isn't as bad as it could have been."

A majority of Australians have their retirement savings invested in their fund's default option, which is usually the balanced investment option that has growth-style assets between 60 and 76 per cent.

View the original article here

New, low-fee funds more popular

ETF Consulting managing director Tim Bradbury says it's a challenge to pick stocks. Picture: Bob Finlayson Source: National Features

A MASSIVE investor money switch from managed funds to a cheaper relative newcomer - exchange-traded funds - is expected to accelerate in the coming months.

Sweeping changes to financial advice rules, including the banning of commissions, will fuel Australia's ETF sector, which grew 30 per cent last year to $6.5 billion and is forecast to grow to $17 billion over the next three years.

ETFs - which are traded on the stock exchange and are designed to track a particular share index, commodity or other type of asset - have only been available in Australia for 12 years. From just one ETF in 2001 that tracked the ASX 200 index, there are now more than 90 of them investing across shares, property, cash, bonds and commodities such as gold.

Their rise has come partly at the expense of managed funds, with research group Morningstar reporting last month that investors withdrew $9.65 billion from managed funds last year, equal to 9 per cent of their assets at the start of the year.

Stephen Small, an associate director at UBS Global Asset Management and former ETFs manager at the Australian Securities Exchange, says the banning of product commissions from July under new financial advice laws will help drive investors into ETFs.

"ETFs don't pay commissions," Small says.

"As people become cost-aware and are looking for transparency, they are taking off. Advisers will have no choice but to do the best thing for their clients."

Small says self-managed super funds are leading the uptake of ETFs, which typically have management fees less than one-third the cost of managed funds. "There are now ETFs across every asset class, so you can structure your entire portfolio based on them," he says.A report released last month by ETF Consulting says the market in Australia has grown 10 per cent this year and should grow 30 per cent for the full year.

ETF Consulting managing director Tim Bradbury says the global financial crisis taught people that it's very hard to pick stocks, so an in investment that tracks a whole market can be attractive.

"We can't control the markets, but we can control the fees," he says.

Bradbury says new financial advice laws are not the only thing that will drive ETF growth. He says internet-savvy investors able to trade online are another key factor.

New products are appearing regularly - UBS's new offering holds the top Aussie share picks from its market-leading analysts. "There's more ways to slice and dice a portfolio," Bradbury says.

"The process of buying and selling managed funds was great last millennium, but we have moved on.

"We have more choice than investors would need to build a good portfolio."

View the original article here

Funds report super returns for retirees

Source: Supplied

THE average retirement nest-egg has grown by more than 12 per cent so far this financial year, the strongest performance by superannuation funds since before the global financial crisis.

Two separate analyses have revealed median balanced superannuation funds - the most common variety - have soared by more than 12.5 per cent since July, the best result since 2007.

In the past decade, the average superannuation nest egg has grown 7.2 per cent each year.

That number more than halves to an average of just 3.2 per cent when the past five years of returns are calculated, with the GFC to blame.

But Chant West director Warren Chant said that with another quarter to go it appeared Australians were on track for pre-GFC double-digit growth in their retirement savings this financial year.

"This year looks as though it's going to be another really good year," he said. "It's been a terrific nine months and in the last 12 months and for the year to March, they've earned 11 per cent; for the nine months it's about 13 per cent."

Chant West said shares and listed property were the best performers in the March quarter - Australian shares increased 8 per cent.

Australian and global Real Estate Investment Trusts (REITs) increased by 5.3 per cent and 8.8 per cent respectively.

However bond markets weren't as successful, Australian and international bonds rose by just 0.2 per cent and 1.2 per cent respectively.

SuperRatings' research analyst Leo Tratras said fund members had a promising start to 2013 before experiencing a slight drop last month due to the banking woes in Cyprus.

"January and February were quite strong but in March there was only a small fall of 0.2 per cent," he said.

"It shouldn't come as a surprise given how strong the first few months of the year were; despite that, the quarterly performance was still up over 4 per cent."

SuperRatings figures found the median balanced option rose by 2.6 per cent in January and a further 2 per cent in February before falling by 0.2 per cent last month.

But Mr Tratras said the March result was a good one compared to the sharemarket's 2.2 per cent fall.

"When you compare that fall in the wider Australian sharemarket to the relatively small drop in super funds it's quite a good performance.

"The bad news isn't as bad as it could have been."

A majority of Australians have their retirement savings invested in their fund's default option, which is usually the balanced investment option that has growth-style assets between 60 and 76 per cent.

View the original article here

Look beyond super for retirement funds

Decisions made today affect the size of your retirement stash. Source: Supplied

THE Federal Government's recent tinkering with superannuation rules continues to undermine the confidence of Australians in using super as their retirement foundation.

Super is the most tax-effective means of building a retirement nest egg. But is it too attractive and can we trust politicians to keep their grubby mitts off it?

We know it's tempting for politicians to water down the tax concessions to bolster the Federal Budget but if you want the system to work properly, and reduce the cost of future age pension payments, politicians can't sacrifice long-term confidence for short-term gain.

The reality is retiring rich means starting to plan early and building a separate retirement nest egg on top of superannuation. That retirement plan starts out aggressively for young investors and becomes more safety conscious as retirement approaches.

It's important to have a strategy that reflects your stage of life. That strategy changes depending on the financial pressures each stage brings.

For example, young investors can take more risk because they have time to recover from corrections. But as you get closer to retirement, the strategy needs to be more conservative because you have fewer investing years to make up for losses.

We think this is the best use of spare cash for the different stages of your financial life. Remember to keep adjusting your options, depending on your changing risk profile.

* Age 25-34

Direct 50 per cent to the mortgage, 20 per cent to superannuation (keeping within contribution limits), 20 per cent to aggressive share investment and 10 per cent to cash reserves.

You have the luxury of being able to take maximum risk. You're probably not earning much, your retirement investing is small and you have plenty of incentives to forget about it altogether. Don't.

Making a big dent in mortgage repayments should be the No.1 priority. It is capital gains tax free and not a bad investment performer.

The rest of your savings should be split between superannuation and shares.

* Age 34-44

Put 40 per cent of your spare cash into mortgage payments, 20 per cent to super, 30 per cent to aggressive share/trust investments and 10 per cent into cash reserves.

You've still got more than 20 years to retirement, so your risk profile is as good as it was five years ago. But your once-tiny nest egg has begun to grow, so you should move some of your money away into less aggressive share or balanced funds, which can perform just as well but take a lower risk profile.

By this time, you should be getting on top of the mortgage.

* Age 45-55

Pay 40 per cent to super, 10 per cent to aggressive growth shares and funds, 20 per cent to balanced funds, 20 per cent to capital stable funds and 10 per cent to cash reserves.

The next 10 years will tend to be your peak earning years, but you've now built such a substantial nest egg that a market catastrophe could leave you without the earning or investing years to make back all you lost. For the first time, safety outweighs growth.

* Age 55-64

Thirty per cent super, 20 per cent balanced funds, 40 per cent capital stable and 10 per cent cash reserves.

You need to know what you're going to have when retirement comes. Capital stable funds can fluctuate, but you're a long-term holder, not a speculator. If interest-rate yields fall, at least the fixed-interest investments in the capital stable funds will increase in value. We've kept the exposure to the balanced funds but make sure you are with a conservative manager. Invest in a fund that has a higher exposure to fixed interest and blue chip shares.

* Age 65+

Happy retirement. Because you started planning all those years ago, the house is paid off, you have the maximum super payout possible and have built a tidy nest egg of other investments to ensure an enjoyable retirement.

> RETIREMENT ESSENTIALS

- Contribute, contribute, contribute.

- Take a portfolio approach.

- Don't be too conservative.

- Focus on consistency rather than timing.

- Pay off the mortgage.

- Protect what you already have.

> INSURANCE: Protect your pet

THESE days you can insure almost anything but whether or not you need it is up to you. The essentials like home and contents, health, car and travel insurance are almost no-brainers.

But deciding whether to fork out for anything else can be tough, especially when it's for something sentimental like a family pet. Yep, pet insurance has become a big business as we protect man's best (and expensive) friend.

The RSPCA offers its own insurance cover and even Medibank Private has a pet cover.

Before making a decision, you need to factor in the pet's age and health to see whether it would be worth it.

If the worst were to happen, and you were to lose that family pet, then would the money really make you feel better? If you have a pet that is constantly in and out of the vet's office, then it may go a long way to taking some of the pressure off your wallet.

There are plenty of choices, so it's worth shopping around.

View the original article here

Look beyond super for retirement funds

Decisions made today affect the size of your retirement stash. Source: Supplied

THE Federal Government's recent tinkering with superannuation rules continues to undermine the confidence of Australians in using super as their retirement foundation.

Super is the most tax-effective means of building a retirement nest egg. But is it too attractive and can we trust politicians to keep their grubby mitts off it?

We know it's tempting for politicians to water down the tax concessions to bolster the Federal Budget but if you want the system to work properly, and reduce the cost of future age pension payments, politicians can't sacrifice long-term confidence for short-term gain.

The reality is retiring rich means starting to plan early and building a separate retirement nest egg on top of superannuation. That retirement plan starts out aggressively for young investors and becomes more safety conscious as retirement approaches.

It's important to have a strategy that reflects your stage of life. That strategy changes depending on the financial pressures each stage brings.

For example, young investors can take more risk because they have time to recover from corrections. But as you get closer to retirement, the strategy needs to be more conservative because you have fewer investing years to make up for losses.

We think this is the best use of spare cash for the different stages of your financial life. Remember to keep adjusting your options, depending on your changing risk profile.

* Age 25-34

Direct 50 per cent to the mortgage, 20 per cent to superannuation (keeping within contribution limits), 20 per cent to aggressive share investment and 10 per cent to cash reserves.

You have the luxury of being able to take maximum risk. You're probably not earning much, your retirement investing is small and you have plenty of incentives to forget about it altogether. Don't.

Making a big dent in mortgage repayments should be the No.1 priority. It is capital gains tax free and not a bad investment performer.

The rest of your savings should be split between superannuation and shares.

* Age 34-44

Put 40 per cent of your spare cash into mortgage payments, 20 per cent to super, 30 per cent to aggressive share/trust investments and 10 per cent into cash reserves.

You've still got more than 20 years to retirement, so your risk profile is as good as it was five years ago. But your once-tiny nest egg has begun to grow, so you should move some of your money away into less aggressive share or balanced funds, which can perform just as well but take a lower risk profile.

By this time, you should be getting on top of the mortgage.

* Age 45-55

Pay 40 per cent to super, 10 per cent to aggressive growth shares and funds, 20 per cent to balanced funds, 20 per cent to capital stable funds and 10 per cent to cash reserves.

The next 10 years will tend to be your peak earning years, but you've now built such a substantial nest egg that a market catastrophe could leave you without the earning or investing years to make back all you lost. For the first time, safety outweighs growth.

* Age 55-64

Thirty per cent super, 20 per cent balanced funds, 40 per cent capital stable and 10 per cent cash reserves.

You need to know what you're going to have when retirement comes. Capital stable funds can fluctuate, but you're a long-term holder, not a speculator. If interest-rate yields fall, at least the fixed-interest investments in the capital stable funds will increase in value. We've kept the exposure to the balanced funds but make sure you are with a conservative manager. Invest in a fund that has a higher exposure to fixed interest and blue chip shares.

* Age 65+

Happy retirement. Because you started planning all those years ago, the house is paid off, you have the maximum super payout possible and have built a tidy nest egg of other investments to ensure an enjoyable retirement.

> RETIREMENT ESSENTIALS

- Contribute, contribute, contribute.

- Take a portfolio approach.

- Don't be too conservative.

- Focus on consistency rather than timing.

- Pay off the mortgage.

- Protect what you already have.

> INSURANCE: Protect your pet

THESE days you can insure almost anything but whether or not you need it is up to you. The essentials like home and contents, health, car and travel insurance are almost no-brainers.

But deciding whether to fork out for anything else can be tough, especially when it's for something sentimental like a family pet. Yep, pet insurance has become a big business as we protect man's best (and expensive) friend.

The RSPCA offers its own insurance cover and even Medibank Private has a pet cover.

Before making a decision, you need to factor in the pet's age and health to see whether it would be worth it.

If the worst were to happen, and you were to lose that family pet, then would the money really make you feel better? If you have a pet that is constantly in and out of the vet's office, then it may go a long way to taking some of the pressure off your wallet.

There are plenty of choices, so it's worth shopping around.

View the original article here

Funds report super returns for retirees

Source: Supplied

THE average retirement nest-egg has grown by more than 12 per cent so far this financial year, the strongest performance by superannuation funds since before the global financial crisis.

Two separate analyses have revealed median balanced superannuation funds - the most common variety - have soared by more than 12.5 per cent since July, the best result since 2007.

In the past decade, the average superannuation nest egg has grown 7.2 per cent each year.

That number more than halves to an average of just 3.2 per cent when the past five years of returns are calculated, with the GFC to blame.

But Chant West director Warren Chant said that with another quarter to go it appeared Australians were on track for pre-GFC double-digit growth in their retirement savings this financial year.

"This year looks as though it's going to be another really good year," he said. "It's been a terrific nine months and in the last 12 months and for the year to March, they've earned 11 per cent; for the nine months it's about 13 per cent."

Chant West said shares and listed property were the best performers in the March quarter - Australian shares increased 8 per cent.

Australian and global Real Estate Investment Trusts (REITs) increased by 5.3 per cent and 8.8 per cent respectively.

However bond markets weren't as successful, Australian and international bonds rose by just 0.2 per cent and 1.2 per cent respectively.

SuperRatings' research analyst Leo Tratras said fund members had a promising start to 2013 before experiencing a slight drop last month due to the banking woes in Cyprus.

"January and February were quite strong but in March there was only a small fall of 0.2 per cent," he said.

"It shouldn't come as a surprise given how strong the first few months of the year were; despite that, the quarterly performance was still up over 4 per cent."

SuperRatings figures found the median balanced option rose by 2.6 per cent in January and a further 2 per cent in February before falling by 0.2 per cent last month.

But Mr Tratras said the March result was a good one compared to the sharemarket's 2.2 per cent fall.

"When you compare that fall in the wider Australian sharemarket to the relatively small drop in super funds it's quite a good performance.

"The bad news isn't as bad as it could have been."

A majority of Australians have their retirement savings invested in their fund's default option, which is usually the balanced investment option that has growth-style assets between 60 and 76 per cent.

View the original article here

Look beyond super for retirement funds

Decisions made today affect the size of your retirement stash. Source: Supplied

THE Federal Government's recent tinkering with superannuation rules continues to undermine the confidence of Australians in using super as their retirement foundation.

Super is the most tax-effective means of building a retirement nest egg. But is it too attractive and can we trust politicians to keep their grubby mitts off it?

We know it's tempting for politicians to water down the tax concessions to bolster the Federal Budget but if you want the system to work properly, and reduce the cost of future age pension payments, politicians can't sacrifice long-term confidence for short-term gain.

The reality is retiring rich means starting to plan early and building a separate retirement nest egg on top of superannuation. That retirement plan starts out aggressively for young investors and becomes more safety conscious as retirement approaches.

It's important to have a strategy that reflects your stage of life. That strategy changes depending on the financial pressures each stage brings.

For example, young investors can take more risk because they have time to recover from corrections. But as you get closer to retirement, the strategy needs to be more conservative because you have fewer investing years to make up for losses.

We think this is the best use of spare cash for the different stages of your financial life. Remember to keep adjusting your options, depending on your changing risk profile.

* Age 25-34

Direct 50 per cent to the mortgage, 20 per cent to superannuation (keeping within contribution limits), 20 per cent to aggressive share investment and 10 per cent to cash reserves.

You have the luxury of being able to take maximum risk. You're probably not earning much, your retirement investing is small and you have plenty of incentives to forget about it altogether. Don't.

Making a big dent in mortgage repayments should be the No.1 priority. It is capital gains tax free and not a bad investment performer.

The rest of your savings should be split between superannuation and shares.

* Age 34-44

Put 40 per cent of your spare cash into mortgage payments, 20 per cent to super, 30 per cent to aggressive share/trust investments and 10 per cent into cash reserves.

You've still got more than 20 years to retirement, so your risk profile is as good as it was five years ago. But your once-tiny nest egg has begun to grow, so you should move some of your money away into less aggressive share or balanced funds, which can perform just as well but take a lower risk profile.

By this time, you should be getting on top of the mortgage.

* Age 45-55

Pay 40 per cent to super, 10 per cent to aggressive growth shares and funds, 20 per cent to balanced funds, 20 per cent to capital stable funds and 10 per cent to cash reserves.

The next 10 years will tend to be your peak earning years, but you've now built such a substantial nest egg that a market catastrophe could leave you without the earning or investing years to make back all you lost. For the first time, safety outweighs growth.

* Age 55-64

Thirty per cent super, 20 per cent balanced funds, 40 per cent capital stable and 10 per cent cash reserves.

You need to know what you're going to have when retirement comes. Capital stable funds can fluctuate, but you're a long-term holder, not a speculator. If interest-rate yields fall, at least the fixed-interest investments in the capital stable funds will increase in value. We've kept the exposure to the balanced funds but make sure you are with a conservative manager. Invest in a fund that has a higher exposure to fixed interest and blue chip shares.

* Age 65+

Happy retirement. Because you started planning all those years ago, the house is paid off, you have the maximum super payout possible and have built a tidy nest egg of other investments to ensure an enjoyable retirement.

> RETIREMENT ESSENTIALS

- Contribute, contribute, contribute.

- Take a portfolio approach.

- Don't be too conservative.

- Focus on consistency rather than timing.

- Pay off the mortgage.

- Protect what you already have.

> INSURANCE: Protect your pet

THESE days you can insure almost anything but whether or not you need it is up to you. The essentials like home and contents, health, car and travel insurance are almost no-brainers.

But deciding whether to fork out for anything else can be tough, especially when it's for something sentimental like a family pet. Yep, pet insurance has become a big business as we protect man's best (and expensive) friend.

The RSPCA offers its own insurance cover and even Medibank Private has a pet cover.

Before making a decision, you need to factor in the pet's age and health to see whether it would be worth it.

If the worst were to happen, and you were to lose that family pet, then would the money really make you feel better? If you have a pet that is constantly in and out of the vet's office, then it may go a long way to taking some of the pressure off your wallet.

There are plenty of choices, so it's worth shopping around.

View the original article here

Australians short on retirement funds

Senior couple on yacht, man using laptop and woman writing postcardSMALL FILE FOR SIZING ONLY Source: Getty Images

AROUND 60 per cent of Australians admit to being unprepared to stop working and expect to run-out of superannuation and cash savings half-way through their retirement.

A survey of 1000 Australians, conducted by banking giant HSBC, found workers expect to be forced to rely on the government pension when their retirement savings run dry after an average of just 11 years.

And in a worrying development for future government budgets, 56 per cent of Australians have never saved for their retirement outside of their superannuation.

HSBC head of wealth management Graham Heunis said future generation are going to be saddled with huge debts as the country's ageing population heads into retirement.

"People need to start saving earlier otherwise the budget pressure will be huge in 20 years,'' he said.

The most recent research shows the average Australian male has just under $200,000 in superannuation while women have only $112,000. And Australians expect 30 per cent of their retirement income to come from the pension, 20 per cent from superannuation, 14 per cent from cash savings, 11 per cent from property and eight per cent from shares and investments.

Mr Heunis said Australians tended to focus on short-term savings goals, with 53 per cent prioritising on saving for things like a holiday over retirement.

The survey results come amid speculation about possible changes to the superannuation system in the Gillard Government's Budget in May.

The Financial Services Council and the SMSF Owners' Alliance yesterday joined forces to call on the Government and Coalition to guarantee no further tax changes will be made to superannuation.

FSC chief executive John Brogden said the negative impact of tax and other changes to superannuation in recent years has seen a net reduction of $5.4 billion from the system.

"Every time a new tax is threatened, confidence in the system is lost,'' he said. "There have been 10 substantial tax changes to superannuation since 2008. The industry has strongly supported sensible reforms to the system, but we've had enough.''

Mr Brogden said that only Australians who start work from 2019 - when superannuation contributions are 12 per cent and retire 40-50 years later will get the benefits of a lifetime of adequate contributions.

View the original article here

Super funds grab a third of your savings

On average Australians pay $2000 in super fund fees per year. Picture: File Source: Supplied

SUPERANNUATION fund fees grab up to a third of your savings over your working life, new analysis shows.

On average Australians pay $2000 in fees per year, research commissioned by ING Direct has found.

The analysis, conducted by Rainmaker, shows that depending on your fund, worst case scenario means the superannuation fees will eat away one third of your savings, but in the best case scenario fees will still take one fifth of your money over your career.

A person who commences work aged 20 on a starting salary of $25,000 is likely to accumulate between $502,000 and $663,000 depending on the fee structure of their super fund, the research found.

But they are expected to pay between $118,000 and $174,000 in total fees.

ING DIRECT head of superannuation Michael Christofides said Australians were getting ripped off by fees that are unnecessarily big.

"Many super funds charging an exorbitant amount," Mr Christofides said.

"Unfortunately many Australians don’t take enough of an interest in their super - most people don't know what their balance is – and a lot of people don't know how much fees they pay."

Once you retire, super fund fees get exponentially higher, because your super balance increases over your career.

ING Direct found over 65s are slugged the highest in fees, paying $6130 a year on average.

People under 35 pay an average annual fee of $445, a figure that jumps up to $1239 for people aged 35-49, $3262 for people aged 50-59 and $3682 for people aged 60-65.

The analysis found that someone who retires with $500,000 would pay up to one fifth of their cumulative benefits in fees over the 35 years their super is expected to last.

Over the 35 years the member will receive an estimated $1.2 million in cumulative benefit payments, but they will pay an estimated $230,000 in cumulative fees which is equivalent to 19 per cent of their cumulative benefits.

These retirement cumulative fees are almost twice the total fees during the pre-retirement accumulation phase.

Association of Superannuation Funds of Australia CEO Pauline Vamos said: "Research published by the consultancy Rice Warner indicates that there are a large number of superannuation funds open to the public with fees which are both well below 1 per cent of assets and the average fee estimates used in the ING analysis.

"ASFA encourages individuals to actively engage with their superannuation and to choose the superannuation fund and investment option that delivers the best value for them in terms of prospective investment returns, services, advice and net fees."

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Australians short on retirement funds

Senior couple on yacht, man using laptop and woman writing postcardSMALL FILE FOR SIZING ONLY Source: Getty Images

AROUND 60 per cent of Australians admit to being unprepared to stop working and expect to run-out of superannuation and cash savings half-way through their retirement.

A survey of 1000 Australians, conducted by banking giant HSBC, found workers expect to be forced to rely on the government pension when their retirement savings run dry after an average of just 11 years.

And in a worrying development for future government budgets, 56 per cent of Australians have never saved for their retirement outside of their superannuation.

HSBC head of wealth management Graham Heunis said future generation are going to be saddled with huge debts as the country's ageing population heads into retirement.

"People need to start saving earlier otherwise the budget pressure will be huge in 20 years,'' he said.

The most recent research shows the average Australian male has just under $200,000 in superannuation while women have only $112,000. And Australians expect 30 per cent of their retirement income to come from the pension, 20 per cent from superannuation, 14 per cent from cash savings, 11 per cent from property and eight per cent from shares and investments.

Mr Heunis said Australians tended to focus on short-term savings goals, with 53 per cent prioritising on saving for things like a holiday over retirement.

The survey results come amid speculation about possible changes to the superannuation system in the Gillard Government's Budget in May.

The Financial Services Council and the SMSF Owners' Alliance yesterday joined forces to call on the Government and Coalition to guarantee no further tax changes will be made to superannuation.

FSC chief executive John Brogden said the negative impact of tax and other changes to superannuation in recent years has seen a net reduction of $5.4 billion from the system.

"Every time a new tax is threatened, confidence in the system is lost,'' he said. "There have been 10 substantial tax changes to superannuation since 2008. The industry has strongly supported sensible reforms to the system, but we've had enough.''

Mr Brogden said that only Australians who start work from 2019 - when superannuation contributions are 12 per cent and retire 40-50 years later will get the benefits of a lifetime of adequate contributions.

View the original article here

Australians short on retirement funds

Senior couple on yacht, man using laptop and woman writing postcardSMALL FILE FOR SIZING ONLY Source: Getty Images

AROUND 60 per cent of Australians admit to being unprepared to stop working and expect to run-out of superannuation and cash savings half-way through their retirement.

A survey of 1000 Australians, conducted by banking giant HSBC, found workers expect to be forced to rely on the government pension when their retirement savings run dry after an average of just 11 years.

And in a worrying development for future government budgets, 56 per cent of Australians have never saved for their retirement outside of their superannuation.

HSBC head of wealth management Graham Heunis said future generation are going to be saddled with huge debts as the country's ageing population heads into retirement.

"People need to start saving earlier otherwise the budget pressure will be huge in 20 years,'' he said.

The most recent research shows the average Australian male has just under $200,000 in superannuation while women have only $112,000. And Australians expect 30 per cent of their retirement income to come from the pension, 20 per cent from superannuation, 14 per cent from cash savings, 11 per cent from property and eight per cent from shares and investments.

Mr Heunis said Australians tended to focus on short-term savings goals, with 53 per cent prioritising on saving for things like a holiday over retirement.

The survey results come amid speculation about possible changes to the superannuation system in the Gillard Government's Budget in May.

The Financial Services Council and the SMSF Owners' Alliance yesterday joined forces to call on the Government and Coalition to guarantee no further tax changes will be made to superannuation.

FSC chief executive John Brogden said the negative impact of tax and other changes to superannuation in recent years has seen a net reduction of $5.4 billion from the system.

"Every time a new tax is threatened, confidence in the system is lost,'' he said. "There have been 10 substantial tax changes to superannuation since 2008. The industry has strongly supported sensible reforms to the system, but we've had enough.''

Mr Brogden said that only Australians who start work from 2019 - when superannuation contributions are 12 per cent and retire 40-50 years later will get the benefits of a lifetime of adequate contributions.

View the original article here

Australians short on retirement funds

Senior couple on yacht, man using laptop and woman writing postcardSMALL FILE FOR SIZING ONLY Source: Getty Images

AUSTRALIANS expect to survive an average of just 11 years on their retirement savings, including superannuation, before they are forced to rely on a government pension.

A survey of 1000 Australians, conducted by banking giant HSBC, found respondents expected their superannuation to run out, on average, just over halfway through their retirement.

Australians expect 30 per cent of their retirement income to come from the pension, 20 per cent from superannuation, 14 per cent from cash savings, 11 per cent from property and eight per cent from shares and investments.

The survey results come amid speculation about possible changes to the superannuation system in the federal government's budget in May.

HSBC head of retail banking and wealth management Graham Heunis said many were financially unprepared for retirement.

"Whether it is the culturally relaxed Australian attitude towards saving, our high cost of living, or an expectation that our super and pension will cover us in retirement, the reality is many Australians are at risk of getting caught very short, financially, towards the end of their life," he said.

"Australians believe they can live a more modest life in retirement. However, this attitude fails to take into account how they will cope with the likely increase in the health and aged care costs of a frail retirement."

Mr Heunis said Australians tended to focus on short-term savings goals, with 53 per cent prioritising on saving for things like a holiday over retirement.

But, he said, younger Australians expected to be less reliant than those currently closer to retirement.

Respondents aged between 45 and 54 expect 45 per cent of their retirement income to come from the pension, while those aged between 25 and 34 expected the pension to account for just 19 per cent of their income.

View the original article here

Super funds grab a third of your savings

On average Australians pay $2000 in super fund fees per year. Picture: File Source: Supplied

SUPERANNUATION fund fees grab up to a third of your savings over your working life, new analysis shows.

On average Australians pay $2000 in fees per year, research commissioned by ING Direct has found.

The analysis, conducted by Rainmaker, shows that depending on your fund, worst case scenario means the superannuation fees will eat away one third of your savings, but in the best case scenario fees will still take one fifth of your money over your career.

A person who commences work aged 20 on a starting salary of $25,000 is likely to accumulate between $502,000 and $663,000 depending on the fee structure of their super fund, the research found.

But they are expected to pay between $118,000 and $174,000 in total fees.

ING DIRECT head of superannuation Michael Christofides said Australians were getting ripped off by fees that are unnecessarily big.

"Many super funds charging an exorbitant amount," Mr Christofides said.

"Unfortunately many Australians don’t take enough of an interest in their super - most people don't know what their balance is – and a lot of people don't know how much fees they pay."

Once you retire, super fund fees get exponentially higher, because your super balance increases over your career.

ING Direct found over 65s are slugged the highest in fees, paying $6130 a year on average.

People under 35 pay an average annual fee of $445, a figure that jumps up to $1239 for people aged 35-49, $3262 for people aged 50-59 and $3682 for people aged 60-65.

The analysis found that someone who retires with $500,000 would pay up to one fifth of their cumulative benefits in fees over the 35 years their super is expected to last.

Over the 35 years the member will receive an estimated $1.2 million in cumulative benefit payments, but they will pay an estimated $230,000 in cumulative fees which is equivalent to 19 per cent of their cumulative benefits.

These retirement cumulative fees are almost twice the total fees during the pre-retirement accumulation phase.

Comment has been sought from the Association of Superannuation Funds of Australia.

View the original article here