Inquiry 1
Hello, similar to over 12,000 others, I find myself in the chaos caused by my superannuation fund going into liquidation.
We are uncertain whether we will recover any funds. My question is, I was planning to reduce my working hours and transition into semi-retirement, but now I'm not sure if that will be possible.
I currently possess $11,000 in a newly established fund (I have lost upwards of $190,000 from my previous super account), $7,500 invested in the stock market, $3,500 worth of shares in Coles, and $5,000 in my bank account.
Robert
Hello Robert,
Indeed, this is a very regrettable circumstance. As you mentioned, many individuals have been affected by the recent downfall of Shield and First Guardian. It’s not just about the finances; this situation undoubtedly imposes a significant emotional toll on many.
There is some potential for recovery since ASIC has put a hold on the funds, and liquidators are assessing the amount that can be retrieved. However, this process could take time.
ASIC is providing updates to investors through Shield Master Fund | ASIC and also here First Guardian Master Fund | ASIC.
The Australian Financial Complaints Authority might also offer assistance. They maintain a specific webpage for support here.
You may need to adjust your expectations. Consider the possibility of working a bit longer than initially intended to increase your super balance.
Fortunately, Australia has a solid safety net in the form of the age pension, accessible starting at age 67.
Inquiry 2
My partner and I have been living outside of Australia for a decade, presently in New Zealand.
My partner, who is 75, works as an academic and plans to retire next year. I am 72 and already retired. We aim to return to Australia next year.
We own an apartment in Sydney that we plan to sell and a house in New Zealand that we will also sell. This should provide us with sufficient funds to purchase a home outside Sydney and hopefully enough to support our retirement.
Are we past the age limit to establish a superannuation fund? A decade ago, when we departed from Australia, we utilized our super to reduce the mortgage on our apartment in Sydney.
Any guidance or suggestions would be greatly valued.
There isn’t any upper age limit for opening a new superannuation account. Nonetheless, there are certain age limitations concerning contributions to super. This makes it impractical for some individuals to create an account.
Once you reach 75 or older, the only contributions permitted are employer superannuation guarantee contributions and down-sizer contributions.
If you’ve owned the Sydney apartment for over a decade and occupied it during that time, both of you may qualify to make down-sizer contributions to your super.
Moreover, since you are below 75, you can still contribute in other ways, including after-tax non-concessional contributions.
I recommend discussing these contribution types with your chosen super fund. Additionally, it might be wise to seek individualized financial advice regarding this situation, along with your overall retirement strategy.
Question 3
I plan to retire in January 2026 after serving 41 years in the public sector. I will receive the full pension from the Public Sector Superannuation fund.
I recently requested a benefit estimate from ComSuper, which highlights three sections – tax-exempt, taxable taxed, and taxable untaxed. However, it includes this note: “The overall pension will be considered in relation to your transfer balance cap. According to this estimate, the pension mentioned above would be valued at $2,319,066, exceeding the current cap.”
Could you explain the specific consequences of this pension exceeding the TBC? I understand that it will decrease the 10 percent discount applicable to the taxable portion of my pension. However, after reviewing the ComSuper and ATO information, I am uncertain if there are any additional consequences.
Please note that my PSS pension will be my sole income during retirement. My wife is likely to continue working for a few more years before she retires with superannuation in a standard accumulation account. Thank you, Anura
Hello Anura,
Providing a clear answer is somewhat challenging without a comprehensive understanding of your financial details and age. These elements are essential in evaluating the precise repercussions of your pension exceeding the transfer balance cap.
The most suitable approach would be to consult with a financial advisor who can offer customized insights based on your situation. This will help clarify any potential effects and enable you to plan appropriately.
In the meantime, you might find the Transfer Balance Cap| Pensioners section on the CSC website helpful, as it features a case study of a member (Jo) whose situation is somewhat analogous to yours – it’s worth a look.
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