(Just retired for two years, newbie really :)) For the current situation of Ukraine war, the tension with China and the ongoing sanctions… Is it better to convert Super to cash? Or, to put the question more directly, have you done anything to your Super for the situation?
/WT
Along the similar line, if you own CSL $1m shares in private, can you live off it comfortably?
Not question of specific holding you have but rather can you live off the dividends.
Selling 10% down is a 10% loss of capital into cash which is paying like 1%. You'd be better off if you have dividend paying shares at 2% plus you get inputation credits.
All we know is in the long term the stock market goes up. If you convert to cash you're eating your capital.
That 2.77 percent… That's 27k
Seems to be 1.2% for this quarter.
Unless you are going to donate that money to Ukrainians, it is pointless for you to do so. Just do what you want to, because my 8-Ball is broken.
Dear OP
I am an old investment advisor
I can tell you 100% that Nobody here knows the answer
In fact nobody in Australia or the world knows the answer.
You are asking people to predict the future
Even the experts get it wrong 70-80% of the time.
In short if you are uncomfortable with whats going on and would sleep better at night then convert to cash.
But superannuation is a long term investment.
You should not be deterred by short term events.
You have not provided your age which is the most important criteria.
Not the events you have mentioned.
BEST ADVICE FOR YOU FROM A FINANCIAL ADVISOR…..
If you are close to retirement (say in next 2 years) then it may be prudent to lock in your gains and sleep better at night.
If you are young with many years to retirement than the events today are nothing but a blimp in the sky..
Mate you just killed the internet. Everyone's an expert.
The best advice is to donate it to me. I have so many OzB deals to impulsively spend on.
but mah tik tok crypto expert says that everything will go up 1000x
^^ This. Get some REAL advice, mate, you know, from people that do this for a living. You're talking about your income stream for the rest of your life. It's FAR too important to rely on internet experts.
^^ This. Get some REAL advice, mate, you know, from people that do this for a living.
Yes. Get advice from glorified salespeople.
@rektrading: Spoken like a true internet expert.
p.s. I just noticed you're a f'n COOKER too!!! The people you meet!
@michaelTito: No.
I used fiat to long TSLA between $700 to $800 while the tanks rolled in. Will go in harder if goes back to those levels.
@rektrading: i didnt understand a single word you said. but good luck when you decide to go in harder.
@May4th: "Bought in" sounds like joining a club.
Long, short, put, call, spot, options, futures, leverage, margin, etc are terms used to give a more precise description of a position.
I wouldn’t call them experts if they’re wrong for 70%~80% of the times… An uneducated person can make it 50-50
I'm going to roll a die. I'm not an expert, but I think I'm going to roll a four.
Yeah, I get my car serviced by a bricklayer.
'BEST ADVICE FOR YOU FROM A FINANCIAL ADVISOR…..
If you are close to retirement (say in next 2 years) then it may be prudent to lock in your gains and sleep better at night.
If you are young with many years to retirement than the events today are nothing but a blimp in the sky..'
except neither above suggestion applies - the OP wrote that they have been 'retired for two years'
Retired at 40 or 70 though ;)
@Amayzingone Do you have a AFS license, #asking for a mate.
Rightly or wrongly, this is basically how I see this:
You're buying say, 1 unit of super for $1
The market crashes and your super falls 50%
You carry on buying super but now you're getting 2 units of super for $1
The market recovers and your super grows but now you have more units of super - which compound
At the end of the day, you'll have more super and a better retirement
It's too late to cash out of super without locking in your losses. Right now, it's best to ride this out and know that the market, and your super, will recover over time. Saying that, if you're close to retirement, you'll unfortunately have taken a hit to your retirement income.
It's called BTFD.
Great answer R4 best one so far, I agree completely
Impossible to answer as I cannot predict the future
I was going to say don't try to time the market, but if you are retired, might be ok. I don't know if now is going to be a great time to convert, but the market could drop lots, or could go have a big jump if the Russia/Ukraine war is resolved.
or could go have a big jump if the Russia/Ukraine war is resolved.
Which sooner or later will happen.
Remember WWI and WWII have an end as well. Same with Vietnam, Iraq, Afghanistan … the lot
No , buy in doom and gloom is about now hehe :)
Add you have a Looney putting his nukes on high alert .
Cooked.
Cooked, roasted, baked, battered, mashed and poached. All in one post
it also has the richest land in the world for food production
Richest land? You need to travel more, a lot more.
putin went on nuclear alert because a year or so ago, the CCP agreed to give the ukraine a 'nuclear umbrella' and have you noticed that china ccp has not come out and denounced the russian invasion? because the chinese CCP PLA is going to invade taiwan after watching ukraine play out on the world stage.
Gamers can expect GPU prices to 🚀 when that happens.
Taiwan likely at some point, but I think China knows the US actually has significant strategic interests there and knows it'll be messy.
I highly doubt the US wouldn't send troops to help tiawan if it happened in the next 5 years - way too much critical silicon industry etc that the US doesn't want in china's hands.
The following 15 nations recognize Taiwan as a sovereign country: Guatemala, Honduras, Haiti, Paraguay, Nicaragua, Eswatini, Tuvalu, Nauru, Saint Vincent and the Grenadines, Saint Kitts and Nevis, Saint Lucia, Marshall Isalnds, Palau, and the Vatican City (U.N. non-member). The United States maintained Taiwan's recognition for 30 years after the Chinese civil war but switched in 1979.
Looks like Taiwan is already part of China, and an intervention would be interference in a country's civil matter.
https://worldpopulationreview.com/country-rankings/countries…
Is It Better to Convert Super to Cash Now?
What does your accountant or financial advisor say?
They probably know more about your financial position than random people on the internet.
Ozb advices are free
and ultimately may end up costing you a lot…
Short term view, get short term answer. Some people don't necessarily want longer term view…
The first time I have upvoted JV…just shows how crazy a year 2022 is. 🤔😮
Gotta upvote you, JV.
A good financial adviser is worth their weight in retirement income.
One day, we might be able to have a financial post and comments where rektrading keeps his oar out of the water
Or should I say, 🚣♂️ out of the 💧
I'll be 🐦 as long as there is a 🐂 momentum. I take holidays in 🐻 markets.
More 🐂💩
Is It Better to Convert Super to Cash Now?
I don't want to convert it - I want to take it out as cash!
Why don't you cash it all out?
Not old enough yet! haha.
I've got at least another 25 years to go!
I did make good use of the two Covid withdrawals in 2020 though! 😁
What good use did you make of that $16k?
@bobbified: Oh for some reason I thought it was capped at $8k each year in thy program.
Is the avg yoy growth rate in your super lower than the interest on your mortgage?
@sjj89: It was $10k per transaction, tax-free and non-assessable. The average growth rate on my super is definitely more than my mortgage. (I made a conscious decision to take out the cash because I've got health issues and I'm unlikely to make it to retirement age when I can access my money freely. If another opportunity came up to access the money, I would do it all over again. 🙃)
@bobbified: I was hoping to hear about an amazing super fund, damn 😅
Preach brother, draw down as much super as you can
@sjj89: I actually do have an amazing super fund! It's got amazing fees! 😋
(I've been working on super funds for the past 20 years. My salary had to come from soooomewhere! haha)
ATO taking notes so @bobbified took money out of super and didn’t have to. He even had fun with it….. letter in the mail with huge tax bill.
@MontyMacaw: I actually managed the whole program at the time for one of australia's largest administrators so knew exactly what was going on! 😋
If your concerns are about the impacts of the Russia / Ukraine conflict on the stock markets, and therefore on your Super investments, aren't you a little late?
Not yet, wait till EU enter the war.
Which EU countries can enter the war without triggering article 5?
U.S has entered the chat.
If the EU enters the war it won't matter whether you have stocks/AUD/crypto, everything goes to shit at that point.
People who hodl hard assets may be affected during times of conflict.
Russia to temporarily ban foreigners from selling assets
Tue, March 1, 2022, 7:17 PM·2 min readMOSCOW (Reuters) -Russia will temporarily stop foreign investors from selling Russian assets to ensure they take a considered decision, not one driven by political pressure, the prime minister said on Tuesday, as Moscow responds to intensifying Western sanctions.
https://finance.yahoo.com/news/russia-impose-temporary-curbs…
The ruble and the stock market damp when people moved their 💵 to other hard assets.
@rektrading: If EU joins hard or digital, all assets will suffer. A lot of Russians are moving cash/digital assets to hard assets like Gold/Silver/Jewellery etc. If EU joins expect others will do similar.
Long term is share's aren't going up Australia is so f'd whether or not you timed your exit is the least of your worries. On the other hand if you are retiring/retired you will need to cashout a portion anyway so shifting enough for the next few years into low risk or cash may be worthwhile. Long story short if you aren't an expert in this pay an expert so they can setup your investments based on your personal circumstances. Also if you have all shares in a single stock probably good to talk to someone about diversifying.
Long term is share's aren't going up Australia is so f'd
Oh cool can I have your crystal ball after you're done with it?
You absolutely need a crystal ball. No matter what logic you try and put behind it - you just don't know.
Not a financial advice.
Don't worry lol you don't need to add this disclaimer, I definitely know it isn't financial advice because it's crap advice if it was trying to be FA
Heard this many times, especially about housing. Never been right.
I guess what are the metrics/ index's / historical data you are basing the statement on.
My parents (who have been alive long enough to remember wars first hand), are very worried. But somehow smoke n mirrors and ignorance is bliss keeps everything chugging along..
Contact your superfund as they may offer intra-fund advice at no additional cost to you
Bitcoin..
but hold it for longer than 4 years.. and dont worry about short term fluctuations.. nobody has lost their money holding it longer than 4 years.. no asset can beat that…
How about cash in a savings account?
u will lose purchasing power over time guaranteed 7-8% pa due to inflation… and its getting worse every year… u need assets.. Most liquid assets are Bitcoin and physical gold..
Hidden Secrets of Money Mike Maloney to understand .. he will try to talk about hashgraph at the end so ignore that.. Only Bitcoin.. everything else is scammy with CEOs …
It is very hard to answer because a lot is unknown e.g. your age, risk appetite, what is your plan to cover expenses during your 2-year retirement.
Assuming that you do not meet the preservation age requirement (i.e. 60 years of age for most people), your question is about asset allocation within your Super portfolio.
The market will be very volatile for a few weeks at least. We don't know how low it can go or when it gets back on track. Usually, each Super fund has a process for converting between asset classes so it could take a few days before your equities are liquidated to cash. You never know what would be real cash value until that transaction happens. That's why Super funds call it estimated cash value.
Speaking generally, it is not a good time now to convert to cash as the market has already dropped. You will only lock in the losses and will miss out on any gains that may happen the day after you cash out.
Do you mean transfer it to a cash fund within your income stream?
If so, you will greatly lower your risk but also lower your tax-free earnings.
You will need to gauge the risk YOURSELF (or with professional advice) depending on your financial situation.
Or do you mean withdraw it as cash?
If so, leaving it as cash won’t earn you much interest. (This interest might be taxable depending on your other sources of income).
Unless you are extremely well disciplined & have a set target as to to when to convert back from cash you are probably better leaving your super invested as it is.
Haha I remember these posts in early 2020 those people got rekt hard.
Nobody likes a sarcastic twerp when somebody asks a real question of importance to them.
It’s actually a fair comment, despite it’s sarcastic tone. Every time there’s negative market sentiment, this question gets asked. Covid was a massive negative, but the market bounced back strongly leaving those who cashed-out with a big loss.
I retired in late Jan. I'm riding it out. I'm invested quite aggressively and down about 6% since the start of the year.
If you haven't changed it prior to the drawback then all you are doing is locking in losses with little hope of recovering them.
What asset classes are you invested in?
Have you done anything to your Super for the situation?
I've gone to cash and will sit on the sidelines whilst this plays out.
Not leaving my money in the hands of a madman, who is now stuck in a corner and willing to do anything to get out.
Putin? hehe
ScoMo doesn’t have any control of OZ financial situation, why are you worried about him?
Not a fan of Labour or Liberal to be honest
If you're retired and statistically have a decade or few of life left, then you wouldn't want to invest in something that could have an eight year dip, when that money is meant to be increasing your standard of living right now.
If you had $1m in Telstra shares and you can live comfortably off the dividends why liquidate it now? Time to liquidate would have been mid Jan 22 when everything haven't dropped 10%+