• 2 Posts
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Joined 1 year ago
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Cake day: June 10th, 2023

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  • I worked in the superannuation industry for a while. I wouldn’t say that super is exactly a scam but it’s a terrible mess and the fees we pay on super in Australia are insane. Basically we have a lot of parasites taking a cut and that ends up making the standard funds poor investments. Median returns on the super funds are around 5.6% pa (over the last ten years for the standard “balanced” option) at a time when stock market tracking funds have appreciated by over 8% pa. A lot of that is being lost in inefficiencies and fees.

    By comparison Americans with a 401k invested in the NASDAQ would have made 17.3% pa over the same period.

    We’re getting a terrible deal with superannuation, and for many it’s the difference between retiring comfortably or retiring in poverty.


  • Aside from anything else, I’ve seen a couple of examples of downsizing up close and in neither case did it end up with them making very much money on the deal. They just ended up with smaller places.

    In the first case they ended up with a small apartment which they actually ended up having to sell some of their retirement investments to be able to afford after selling a large family home in the outer suburbs and paying all the costs associated with selling.

    In the other case she moved from a large family home in the outer suburbs into one of those “retirement communities”. The whole thing’s a massive scam. You “buy” the unit but you don’t actually own it, you only own a leasehold on it - something they didn’t make clear to her at all. You’re not allowed to even improve or renovate it. They impose rules on you much like a rental. And when you move out you’re not allowed to sell it - they contractually reserve the right to sell it themselves and pay you a massively discounted amount for it. Essentially they steal half the value of what you originally paid in a time when house prices are going up as well. It’s straight up exploitation of people who are old and struggling to even do everyday tasks, let alone understand complex contracts.