You are in danger of losing control of your superannuation
On 9 March 2016 the Australian Government issued a discussion paper about the objective of Superannuation to be enshrined in legislation.
The proposed primary objective for superannuation is
“To provide income in retirement to substitute or supplement the Age Pension”.
If this objective is passed, I see a very large issue that could impact one in four Australians who do not expect to pay off their home loan by the time they retire. These people will need their superannuation to help pay off their mortgage. Are you going to be one of these people?
My concern is that if this objective is adopted, it will be very easy for vested interests to push that the only way to comply with this objective is for superannuation to be paid out via an annuity.
As such, I see the high potential for lump sums to be eliminated and the only way to access your superannuation will be via an annuity.
If you are one the people who need your superannuation to pay off your home loan, or even worse to fund large medical bills, do you want to beholden to the wishes of vested interests, or do you want to control your own money?
Remember this is your money, not the governments, not the financial institutions that run the retail funds or the unions that run the industry funds.
If you are concerned like me that you may lose control of your superannuation, you need to provide your feedback to the Division Head of the Retirement Income Policy Division of The Treasury by 6 April 2016.
You can email them directly on superannuationobjective@treasury.gov.au
Remember, superannuation is your money, and you need to remain in control of what happens to this.
If you want to read this discussion paper, you can find a PDF version here
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Wayne Wanders
The Wealth Navigator
wayne@avoidthepovertytrap.com.au