The Superannuation system is not fit for purpose, as many are finding out as balances decline, while fees do not but forced contributions increase. So today we look at data provided by APRA on fund performance (down more than 4% in the quarter to June 2022, and further now). And we feature an important contribution from Senator Gerard Rennick who addressed The Senate last week on this important issue.
Go to the Walk The World Universe at https://walktheworld.com.au/
In this week’s market review we will as always begin in the US, cross to Europe and Asia, and end up with a local Australian summary – bearing in mind that our market pretty slavishly follows those in the Northern Hemisphere, which had an up day on Thursday, and a down day on Friday.
Volatility continues to rage across most asset classes, and this is now having real world consequences on our superannuation, or pension savings, which in Australia are forced by Government. As we will see the losses are mounting up.
But first, it was a bad end to a wild week with U.S. stocks dropped on Friday as worsening inflation expectations kept intact worries that the Federal Reserve’s aggressive rate hike path could trigger a recession, while investors digested the early stages of earnings season. The previous day the stronger than expected inflation data showed inflation remained stubbornly high and this shocked the market into a volatile rise. But in the last session of a volatile week, equities opened higher, then reversed course after data from the University of Michigan showed consumer sentiment improved in October but inflation expectations worsened as gasoline prices moved higher. The median expected year-ahead inflation rate rose to 5.1%, above the 4.7% seen in September. A climb in inflation expectations, a closely watched metric by the Federal Reserve, comes just a day after data showed worse-than-feared inflation pressure.
“Yesterday you had this amazing, powerful intraday rally that was completely wrong,” said Phil Orlando, chief equity market strategist at Federated Hermes. “Then you look at the Michigan numbers this morning that’s consistent with what we’re seeing in the economy, and the stock market now is down to reflect that number. That’s correct.”
The latest edition of our finance and property news digest with a distinctively Australian flavour.
Go to the Walk The World Universe at https://walktheworld.com.au/
This is an edited version of our live discussion about the current state of Superannuation, the the financial system. Who is it working for? The original streeam is here: https://youtu.be/saS_fOF2XyI Robert Barwick is the Research Director – Australian Citizens Party. Go to the Walk The World Universe at https://walktheworld.com.au/
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DFA Live Q&A HD Replay Robbie Barwick: The Great Super Con [Podcast]
Join us for a live discussion about the current state of Superannuation, and the financial system. Who is it working for? You can ask a question live.
Federal Treasurer Jim Chalmers has told the annual Superannuation Lending Roundtable that he believes that Australia’s $3.4 trillion superannuation sector should play a bigger role in building the nation. He said that with governments heavily laden with debt, energy and housing are two obvious areas that super funds should look to invest.
Former prime minister Paul Keating was also at the event, and called for super funds to look at ways of facilitating access to housing.
“We see trillions of dollars in workers’ capital, we see government budgets heaving with debt, and there are obvious needs for investment, particularly in areas like housing and energy,” Dr Chalmers told the annual Superannuation Lending Roundtable…
Dr Chalmers pointed to a lack of spending in the aged care sector and said he would “contemplate what, if any, further role for super there is in that”…
“This is a society that can’t house its own children,” Mr Keating said. “If super funds just think they can go buy tech stocks in America and highways in Italy, they’re going to run into trouble. Without being heavy-handed, there is a requirement of the funds to look at social opportunities.”
I caught up with author Peter Cox to discuss his book “Life’s Equation” an excellent if slightly shocking read about the financial decisions we make (or do not make) and how they resonate down the years.
“This book shows you how to break out of your comfort zone and do something amazing for your future…start now! This book is for all who care enough about their future to do something about it as it examines the financial and lifestyle decisions that we make as we journey through life… If you had your life again, would you do things differently? Would you gain what you wanted?
Peter Cox, a seasoned accountant, and advisor explains in real terms how to start thinking beyond the square and dig deep into the network of information where ideas lay waiting within you to create a better future, you just need to know how to find them. This book has helped many people with stepping beyond their own expectations in simple and easy steps that make the process fun and profitable! Written in easy-to-understand language, it contains a comprehensive blend of information for those ready to accept personal responsibility for their financial future.
Whether a teenager, college student, single parent, married with kids, or a seasoned business professional, the book’s content was researched and organized to benefit anyone in whatever season of life”.
We look at the latest proposals to allow first time buyers to access superannuation to buy their first home. The proposal is supported by powerful Political voices, but also opposed by Ministers. And evidence from our surveys suggests this would be a trigger to rise prices further.
Go to the Walk The World Universe at https://walktheworld.com.au/
I discuss a Nucleus Wealth article authored by Tim Fuller, Head of Advice at Nucleus.
The allure of having complete control over your financial future is very compelling, and becomes even more so in turbulent market periods, like the one we have seen in 2020. So it is understandable that 2020’s volatile markets combined with the opaqueness of many large super funds could have left you wondering if you should be opening your own self managed super fund (SMSF).
An important discussion with Steve Mickenbecker, Group Executive, Financial Services & Chief Commentator at Canstar. Super is fraught with issues, which can squash returns. What can be done to maximise them?
Note: DFA has no commercial relationship with Canstar.
[We had some issues with audio sync over Zoom, fixed in post as best we could]
