Ray Ong sat down with 98five again to talk about Super. 1 million Aussies are now managing their own super. The listeners of 98five asked Ray some great questions about super, and Self Managed Superfunds.
Why are so many Australians managing their own super?
My take is that when we had the GFC people saw their super balances go down, no one likes to see their investments and money go backwards especially after a period of such great performance. Then they would have seen fees come out when they had not made any money and now a lot of aussies have decided to set up their own super fund because of poor return and high fees.
Can you buy an investment property with a SMSF?
Yes you can, if you don’t like shares etc then yes you can buy property. However it depends on what you’re looking for with the investment strategy
The logic behind a SMSF is that you’re in control. The crazy thing that I have seen is that sometimes people have gone into a SMSF on the advice of their financial planner but then they stop managing it, you need to be proactive to make a return.
I had a bank call me to make an appointment to assess my home loan. Should I trust the bank to do what’s best for me or would they solely be interested in their own interests?
I think with the bank, at the end of the day it’s going to put their product in front of you which isn’t necessarily a bad thing. It’s hard to generalise by saying you will have a bad experience at the bank. If you go see a mortgage broker, they will be able to put something in front of you that is going to suit your needs because they have the entire market to choose a product from however that’s not to say that the products on offer at the bank won’t suit your needs or situation.
It all comes down to how you feel. If you feel who you’re dealing with has your best interests in mind whether it’s someone at the bank or a mortgage broker they are good for you.
The super industry needs major work, there’s lots of people who have retired and then lost their money through scams that the government could easily stop if they wanted to. What are your thoughts Ray?
I really hope this hasn’t happened to you. I think as in most industries there’s a lot that can be done to improve it. With Super, my take is that there’s a lot of misunderstanding, it isn’t something you learn in school so if you want to get an understanding of the share market etc and you look in the newspaper you will only hear things that are negative. When things are good, you won’t hear about it. Australia is very progressive in regards to super, there’s places around the world where you need to use some of your retirement funds to get a guaranteed income per year whereas in Australia we keep the money invested for your retirement. In regards to the scams, my advice is that you should always investigate. If it sounds too good to be true, do your research and find a second opinion.
Listen to the full podcast here: