Transition to retirement pension and July 1 2007.

[Ext User(Moonshadow)]

In an article in The Age titled "Why pay tax when you don't need to",
http://www.theage.com.au/news/superannuation/why-pay-tax-when-you-dont-need-to/2007/04/28/1177460028584.html
the author says
"The additional taxation burdens on anyone over 60 resulting from not
being able to start a TRAP before July 1, 2007, far outweigh the cost
savings these funds say they are providing."

What is the significance of July 1 2007?
Can't I start a TRAP on July 1 and to all intents and purposes (except
for the loss of the benefit of the arrangement for one tax year) gain
the same benefits, or will the new super laws change or complicate
something?

[Ext User(Interested)]

> In an article in The Age titled "Why pay tax when you don't need
> to",
> http://www.theage.com.au/news/superannuation/why-pay-tax-when-you
> -dont-need-to/2007/04/28/1177460028584.html the author says
> "The additional taxation burdens on anyone over 60 resulting
> from not being able to start a TRAP before July 1, 2007, far
> outweigh the cost savings these funds say they are providing."
>
> What is the significance of July 1 2007?
> Can't I start a TRAP on July 1 and to all intents and purposes
> (except for the loss of the benefit of the arrangement for one
> tax year) gain the same benefits, or will the new super laws
> change or complicate something?
>

Its a good qustion and one I would like to know the answer to as
well.
Hope someone can post some information on this.
Travis??

[Ext User(John Wright)]

"Interested" wrote [edited]
>> What is the significance of July 1 2007?
>> Can't I start a TRAP on July 1 and to all intents and purposes
>> (except for the loss of the benefit of the arrangement for one
>> tax year) gain the same benefits, or will the new super laws
>> change or complicate something?
>>
>
> Its a good qustion and one I would like to know the answer to as
> well.
> Hope someone can post some information on this.
> Travis??

AFAIK, 1st July 2007 is not VERY significant. If you have a super in
accumulation phase, you can start your TRAP/allocated pension on 1st July
'07 or later; only your savings will be lessor to that extent, as super
funds pay 15% tax on earnings.

The author in that article is referring to the larger industry super funds
that don't offer a TRAP or allocated pension; so the question was whether it
is worthwhile moving out of them. The author says yes it is; the cost
savings these industry funds give you is outweighed by the taxation savings
of starting a TRAP/allocated pension with another fund, particularly for
aged 60+ for whom pension is totally tax free from 1/7/07, even for 55+ it
is still pretty good.

Regards - JW

[Ext User(Travis Morien)]

On May 7, 8:30 am, Moonshadow <moonsha...@nospam.org> wrote:
> In an article in The Age titled "Why pay tax when you don't need to",http://www.theage.com.au/news/superannuation/why-pay-tax-when-you-don...
> the author says
> "The additional taxation burdens on anyone over 60 resulting from not
> being able to start a TRAP before July 1, 2007, far outweigh the cost
> savings these funds say they are providing."
>
> What is the significance of July 1 2007?

That's when the revised superannuation rules from last year's budget
kick in.

> Can't I start a TRAP on July 1 and to all intents and purposes (except
> for the loss of the benefit of the arrangement for one tax year) gain
> the same benefits, or will the new super laws change or complicate
> something?

The issue here is that some funds do not allow members to commence a
pension until they have actually retired.

Super funds are governed by two sets of rules. There are the rules
that the government imposes and the rules that the super fund imposes.

A good super fund tries to minimise the latter set of rules so members
are able to do anything which the law allows. Not all super funds are
good super funds though!

The overwhelming majority of funds which have pointless and inflexible
rules in their trust deeds are industry super funds - the same funds
that are currently running the "compare the pair" campaign where they
extol their low fees as their one selling point. While generally
other types of funds do concede that industry funds are cheaper, those
other funds point out that industry funds tend to lack much of the
flexibility, investment choice, online account reporting and
switching, types and premiums of insurance, flexible estate planning
arrangements, prompt administration, modern taxation and unit pricing
calculation methods etc of the more expensive types of funds, and that
those shortcomings are severe enough that maybe these funds aren't
that great a bargain after all.

This article is focusing on one aspect which many industry funds have
which makes them a bad bargain for some people.

I personally sit on the fence here. I use a couple of industry funds
for some clients, but I'm not a big user of them for many of the
reasons above.

Travis
www.travismorien.com

[Ext User(Moonshadow)]

Travis Morien wrote:
> On May 7, 8:30 am, Moonshadow <moonsha...@nospam.org> wrote:
>> In an article in The Age titled "Why pay tax when you don't need to",http://www.theage.com.au/news/superannuation/why-pay-tax-when-you-don...
>> the author says
>> "The additional taxation burdens on anyone over 60 resulting from not
>> being able to start a TRAP before July 1, 2007, far outweigh the cost
>> savings these funds say they are providing."
>>
>> What is the significance of July 1 2007?
>
> That's when the revised superannuation rules from last year's budget
> kick in.
>
>> Can't I start a TRAP on July 1 and to all intents and purposes (except
>> for the loss of the benefit of the arrangement for one tax year) gain
>> the same benefits, or will the new super laws change or complicate
>> something?
>
> The issue here is that some funds do not allow members to commence a
> pension until they have actually retired.
>
> Super funds are governed by two sets of rules. There are the rules
> that the government imposes and the rules that the super fund imposes.
>
> A good super fund tries to minimise the latter set of rules so members
> are able to do anything which the law allows. Not all super funds are
> good super funds though!
>
> The overwhelming majority of funds which have pointless and inflexible
> rules in their trust deeds are industry super funds - the same funds
> that are currently running the "compare the pair" campaign where they
> extol their low fees as their one selling point. While generally
> other types of funds do concede that industry funds are cheaper, those
> other funds point out that industry funds tend to lack much of the
> flexibility, investment choice, online account reporting and
> switching, types and premiums of insurance, flexible estate planning
> arrangements, prompt administration, modern taxation and unit pricing
> calculation methods etc of the more expensive types of funds, and that
> those shortcomings are severe enough that maybe these funds aren't
> that great a bargain after all.
>
> This article is focusing on one aspect which many industry funds have
> which makes them a bad bargain for some people.
>
> I personally sit on the fence here. I use a couple of industry funds
> for some clients, but I'm not a big user of them for many of the
> reasons above.
>
> Travis
> www.travismorien.com
>

Many thanks for the information Travis & John.

[Ext User(risko)]

On May 9, 8:31 am, Moonshadow <moonsha...@nospam.org> wrote:
> Travis Morien wrote:
> > On May 7, 8:30 am, Moonshadow <moonsha...@nospam.org> wrote:
> >> In an article in The Age titled "Why pay tax when you don't need to",http://www.theage.com.au/news/superannuation/why-pay-tax-when-you-don...
> >> the author says
> >> "The additional taxation burdens on anyone over 60 resulting from not
> >> being able to start a TRAP before July 1, 2007, far outweigh the cost
> >> savings these funds say they are providing."
>
> >> What is the significance of July 1 2007?
>
> > That's when the revised superannuation rules from last year's budget
> > kick in.
>
> >> Can't I start a TRAP on July 1 and to all intents and purposes (except
> >> for the loss of the benefit of the arrangement for one tax year) gain
> >> the same benefits, or will the new super laws change or complicate
> >> something?
>
> > The issue here is that some funds do not allow members to commence a
> > pension until they have actually retired.
>
> > Super funds are governed by two sets of rules. There are the rules
> > that the government imposes and the rules that the super fund imposes.
>
> > A good super fund tries to minimise the latter set of rules so members
> > are able to do anything which the law allows. Not all super funds are
> > good super funds though!
>
> > The overwhelming majority of funds which have pointless and inflexible
> > rules in their trust deeds are industry super funds - the same funds
> > that are currently running the "compare the pair" campaign where they
> > extol their low fees as their one selling point. While generally
> > other types of funds do concede that industry funds are cheaper, those
> > other funds point out that industry funds tend to lack much of the
> > flexibility, investment choice, online account reporting and
> > switching, types and premiums of insurance, flexible estate planning
> > arrangements, prompt administration, modern taxation and unit pricing
> > calculation methods etc of the more expensive types of funds, and that
> > those shortcomings are severe enough that maybe these funds aren't
> > that great a bargain after all.
>
> > This article is focusing on one aspect which many industry funds have
> > which makes them a bad bargain for some people.
>
> > I personally sit on the fence here. I use a couple of industry funds
> > for some clients, but I'm not a big user of them for many of the
> > reasons above.
>
> > Travis
> >www.travismorien.com
>
> Many thanks for the information Travis & John.- Hide quoted text -
>
> - Show quoted text -

Does anyone know of a fund which offers passive investment options for
super accumulation (a la Vanguard ) as well as allocated pension with
same investment, at passive investing type fees?
Risko

[Ext User(Travis Morien)]

On May 13, 9:05 am, risko <drmgilli...@gmail.com> wrote:

> Does anyone know of a fund which offers passive investment options for
> super accumulation (a la Vanguard ) as well as allocated pension with
> same investment, at passive investing type fees?
> Risko

Yes

Travis
www.travismorien.com

[Ext User(risko)]

On May 13, 7:38 pm, Travis Morien <travismor...@yahoo.com> wrote:
> On May 13, 9:05 am, risko <drmgilli...@gmail.com> wrote:
>
> > Does anyone know of a fund which offers passive investment options for
> > super accumulation (a la Vanguard ) as well as allocated pension with
> > same investment, at passive investing type fees?
> > Risko
>
> Yes
>
> Traviswww.travismorien.com

ooh, mincy

[Ext User(Glen Killen)]

"Travis Morien" <travismorien@yahoo.com> wrote in message
news:1179049098.359144.298900@o5g2000hsb.googlegro ups.com...
> On May 13, 9:05 am, risko <drmgilli...@gmail.com> wrote:
>
>> Does anyone know of a fund which offers passive investment options for
>> super accumulation (a la Vanguard ) as well as allocated pension with
>> same investment, at passive investing type fees?
>> Risko
>
> Yes
>
> Travis
> www.travismorien.com
>
Very Very Funny. Travis you never mentioned that you worked previously for
Microsoft - information provided is technically correct but bloody useless
:)

[Ext User(Travis Morien)]

On May 14, 1:03 pm, "Glen Killen" <glen.kil...@gmail.com> wrote:
> "Travis Morien" <travismor...@yahoo.com> wrote in message
>
> news:1179049098.359144.298900@o5g2000hsb.googlegro ups.com...> On May 13, 9:05 am, risko <drmgilli...@gmail.com> wrote:
>
> >> Does anyone know of a fund which offers passive investment options for
> >> super accumulation (a la Vanguard ) as well as allocated pension with
> >> same investment, at passive investing type fees?
> >> Risko
>
> > Yes
>
> > Travis
> >www.travismorien.com
>
> Very Very Funny. Travis you never mentioned that you worked previously for
> Microsoft - information provided is technically correct but bloody useless
> :)


:)

Risko is a professional investment consultant who can and should be
able to do his own research. Perhaps he could ask some of the funds
he charges for his expertise.

Travis
www.travismorien.com

[Ext User(risko)]

On May 14, 5:41 pm, Travis Morien <travismor...@yahoo.com> wrote:
> On May 14, 1:03 pm, "Glen Killen" <glen.kil...@gmail.com> wrote:
>
>
>
>
>
> > "Travis Morien" <travismor...@yahoo.com> wrote in message
>
> >news:1179049098.359144.298900@o5g2000hsb.googlegro ups.com...> On May 13, 9:05 am, risko <drmgilli...@gmail.com> wrote:
>
> > >> Does anyone know of a fund which offers passive investment options for
> > >> super accumulation (a la Vanguard ) as well as allocated pension with
> > >> same investment, at passive investing type fees?
> > >> Risko
>
> > > Yes
>
> > > Travis
> > >www.travismorien.com
>
> > Very Very Funny. Travis you never mentioned that you worked previously for
> > Microsoft - information provided is technically correct but bloody useless
> > :)
>
> :)
>
> Risko is a professional investment consultant who can and should be
> able to do his own research. Perhaps he could ask some of the funds
> he charges for his expertise.
>
> Traviswww.travismorien.com- Hide quoted text -
>
> - Show quoted text -

Risko is no such thing. he earms his crust by getting covered in dust
and trying to get some sense into the bullshit that most financial
advisers inflict upon people.
Travis, my little mincer, tell people again about the crap that you
flog for risk in superannuation, and tell em how you dont have a
bloody clue about currency ( it's all there in the ausinvest records,
eh, mincer?).
The reason i asked this question is that i have a friend who has sold
her house and wants to know how to invest the difference in some
productive way bearing in mind she's 67 and has nothing else.
I havent consulted for years and never have worked at the product
level but thought there might be someone who was straight enough to
give a hand.

[Ext User(Travis Morien)]

On May 14, 5:13 pm, risko <drmgilli...@gmail.com> wrote:
> On May 14, 5:41 pm, Travis Morien <travismor...@yahoo.com> wrote:
>
>
>
> > On May 14, 1:03 pm, "Glen Killen" <glen.kil...@gmail.com> wrote:
>
> > > "Travis Morien" <travismor...@yahoo.com> wrote in message
>
> > >news:1179049098.359144.298900@o5g2000hsb.googlegro ups.com...> On May 13, 9:05 am, risko <drmgilli...@gmail.com> wrote:
>
> > > >> Does anyone know of a fund which offers passive investment options for
> > > >> super accumulation (a la Vanguard ) as well as allocated pension with
> > > >> same investment, at passive investing type fees?
> > > >> Risko
>
> > > > Yes
>
> > > > Travis
> > > >www.travismorien.com
>
> > > Very Very Funny. Travis you never mentioned that you worked previously for
> > > Microsoft - information provided is technically correct but bloody useless
> > > :)
>
> > :)
>
> > Risko is a professional investment consultant who can and should be
> > able to do his own research. Perhaps he could ask some of the funds
> > he charges for his expertise.
>
> > Traviswww.travismorien.com-Hide quoted text -
>
> > - Show quoted text -
>
> Risko is no such thing. he earms his crust by getting covered in dust
> and trying to get some sense into the bullshit that most financial
> advisers inflict upon people.
> Travis, my little mincer, tell people again about the crap that you
> flog for risk in superannuation, and tell em how you dont have a
> bloody clue about currency ( it's all there in the ausinvest records,
> eh, mincer?).
> The reason i asked this question is that i have a friend who has sold
> her house and wants to know how to invest the difference in some
> productive way bearing in mind she's 67 and has nothing else.
> I havent consulted for years and never have worked at the product
> level but thought there might be someone who was straight enough to
> give a hand.


I've mentioned numerous super funds in this newsgroup over the years
which offer investors access to passive investments including index
funds and DFA, which offer CGT-free rollover from accumulation to
pension mode and have total fees comfortably under 1%pa.

Macquarie Super and Pension Manager, AssetLink, Money Management
Service Wrap, Oasis/Wealthtrac do all that.

Colonial First State's FirstChoice Wholesale Superannuation probably
would do the trick as well except it doesn't have DFA on its menu and
I'm not sure about the CGT-exempt rollover to pension bit.

SunSuper might also be worth a look, its cheap (though not quite as
cheap for accumulation accounts) and has passive funds on its menu.

However since you didn't provide any detail the first time around I
likewise didn't provide any detail. Vitally important issues such as
how much the investor has to invest affect which products are the best
value because some products start off cheap but taper their fees for
high account balances very slowly and thus end up expensive for large
investors, others start off expensive but drop off quickly and can be
a bargain for large investors. There are also complexities such as
fee structures based on the amount invested in total or the amount
invested per fund and some funds have transaction fees of various
sorts while others don't.

Another point you are overlooking which jumped out at me immediately
was that you said this person was 67 years old. Her work status will
determine whether or not she can put this into superannuation, because
once you hit age 65 work tests apply.

And furthermore the risk profile of the investor hasn't been discussed
at all. It is possible that the risk profile, spending requirements
and other issues rule out investment in any of the types of funds and
products mentioned, though of course conservative investments can be
purchased in super.

In other words, ask a vague question get a vague answer. If you want
to "reboot" your presence in aus.invest and stop getting flamed every
time you open your mouth, maybe it would be best to start again with a
new net alias or something. You've earned a fairly damaging online
reputation with your past antics in this newsgroup and can't expect to
be taken too seriously.

Travis
www.travismorien.com