I am 35. What probability do you place on a future government increasing the preservation/retirement age (by the time I get there)? I can’t help but feel that probability is “high”.
I don’t want to work forever and have $180K in an industry super fund and my employer contributes 17% on my $106K p.a. salary. I have been salary sacrificing for the past few years but with the current political climate I have lost all faith and can’t help but think that a future government will change the rules. It seems those (few of us) that take action early and plan to be financially independent are the ones to get punished through rule changes because they are easy political targets. I’m thinking it may be safer to pay more tax now and build wealth outside of super and let my employer make contributions (which I know are already well above average). Do you have any opinions (not financial advice) on this subject?
- Very high, almost inevitable.
- Generally, I think young adults should build wealth outside super. Step 1 is to own your own home. Step 2 (if you are paying a high rate of tax) is probably to buy an investment property and/or invest in shares. Step 3 is then to invest in super. If you are saving for your first home, I would be putting any surplus cashflow through the First Home Super Saver Scheme. (see https://www.ato.gov.au/individuals/super/super-housing-measures/first-home-super-saver-scheme/