Superannuation going backwards
My superannuation was parked in cash for a few months earlier this year while I switched it to a new account.
That meant I fortunately missed the first half of the stock market downturn and probably saved a few thousand dollars.
I opened the new account with about $78,000. It’s worth the same today, even though employer contributions have been going in now for a few months.
It will probably be worth less next week when the recent share market turmoil washes through.
I just changed the asset allocation to bump up the cash component from 10 percent to 50 percent. The cash return is currently 7.4 percent.
It might be a year or more before shares offer the same level of return.
I had only been in the workforce a couple of years when compulsory super was introduced, about 1988 I think.
There were a few years I had my own business when not much was contributed.
Near enough to $80,000 in 20 years is pretty good, I suppose. Without compulsory super it’s almost certain I would not have saved that much.
I'm a 41-year-old father of four working as a newspaper editor at Mount Gambier in South Australia.
September 20th, 2008 at 1:01 pm
Michael, thanks for the link! and..I was just about to have a blog about superannuation myself. It must be on a lot of people’s minds as this is the “statement season” and the “good news” is being delivered to the happy masses. I just changed one of my accounts, which has suffered a 10% loss, to 95% fixed interest bonds and 5% cash.