I have no superannuation fund. I had a small amount accumulated from various employment over the years, but at 55, I cashed it all it to keep my business solvent during a bad period, basically so I could pay staff. Many small business people have been there.
We do have a number of properties, our home, my office & factory, Mrs Fox's Medical Rooms and an investment property in Toorak.
While our home is nice, it is worth zip unless you sell it and you need to live somewhere, so while it will keep me out of the rain when I retire, it gives me nothing in income to keep me fed or buy me seats to the footy, or pay Foxtel.
The investment property and the Medical practice as subject to a large loan that means that currenly our equity is about 30%. The rent income from both places does not cover the mortgage repayments but it does cover the interest. When you add in all the costs it is very negatively geared, and unless there is a large capital gain we will at best break even if we sell. If negative gearing tax benefit is eliminated then it would hurt us further.
My office and factory is my super, I guess but in order to cash in, have to sell it and sell the business as well, and there doesn't seem to be anyone beating the door down to buy it. The property is worth about $1,000,000 on a very good day, but could be as low as $850,000 if forced to sell quickly.
I did the sums, and if we had put all over money into a super funds like CBUS when we started our business 25 years ago and rented office and home, we would have had much less overheads, no interest payments, better cash flow control and a larger nest egg at 65, projected to be worth over $3 million.
We have all been bought up on the myth about home ownership, but it does not give great returns in retirement and is really only a boon for your kids when you die. In Germany, home ownership is much lower and not seen as important. Many rent all their lives in the same home with long secure leases.
Maybe we are looking at this from the wrong perspective. It should be about the best way to get a roof over our heads, and not housing ownership. Politically it should be about quality of life for all, which should mean less working hours, better life style and lower stress. Our economic system has made younger generations angry at older generations, and the future seems difficult for many. The gap between rich and poor gas widened, wages have stalled, the world seems more dangerous, and does Trump/Putin/Turnball/May etc have a solution ?
It is not an argument about Left vs Right, there is a better way, but farked if anyone knows what it is, or are prepared to actually find out.