Money Magazine June 2021
Money magazine is Australia’s longest-running, highest-selling and most-read personal finance magazine. Money magazine provides credible, independent, easy-to-understand financial advice to help its readers save money and make the most of their investments.
en aquest número
by the numbers
$250,000 IS CLOSE to the magic number if you want to know how much you need to save through super as a single homeowner while still being eligible for the age pension. When we last ran a similar cover story two years ago, some readers were aghast at the idea of anyone wanting to have the best of both worlds. Surely with so many people struggling to make ends meet, anyone with a hefty nest egg shouldn’t try to game the system and get additional government assistance in their old age. But I think this misses the point that unless we have a national discussion about superannuation and its impact on our social system, more people would be spending decades at work only to walk into their retirement worse off because they…
feedback
Letter of the month How we play mind games with our money I’ve really enjoyed Phil Slade’s contribution to Money over the years in his Mind Games column. Having studied psychology myself, I’m able to get a sense of how many of our decisions around money are often not so much about money at all. One of the more enduring theories in psychology is that of self-determination theory, first introduced in the 1980s. One its central tenets is that people are going to be strongly and intrinsically motivated to make decisions that reinforce three key psychological needs: autonomy, competence and relatedness (or connection). Who doesn’t want to feel self-determined and in control, skilled and competent, and connected to other people? It’s not hard, then, to see how money becomes a vehicle to drive the…
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Contact us To send a letter to the editor, write to: Money, Level 7, 55 Clarence Street, Sydney NSW 2000 or email money@moneymag.com.au For all enquiries and letters, please include name, address and phone details. Letters may be edited for clarity or space. Because of the high number of letters received, no personal replies are possible. How to get Money Subscribe to the print or digital edition, as well as our free weekly email newsletters via the Money website or: Online: magshop.com.au/money-magazine Call: 136 116…
how do you give back to the community?
SHARYN McCOWEN This year I’m on a mission to donate plasma every two weeks. One in three Aussies will need blood products in their lifetime, but only one in 30 of us donates each year, so I’m trying to move the needle (pardon the pun). It’s a rewarding way to support strangers in need, plus there’s free chocolate milk. And I’m encouraging the rest of the Money team to get involved, so please remind them to roll up their sleeves. BOB CHRISTENSEN Charities have been having a tough time because of the pandemic, so I’m increasing my contributions to the random ones I support. In normal years I renew my friendship with the neighbourhood dogs and their owners through Red Cross Calling, but this year it’s a virtual appeal instead, so it will…
run your own retirement race
When I read an article recently by journalist Karren Vergara (on Moneymag.com.au) on her super balance of $154,000, it got me thinking. With just over 25 years to retirement, she can’t possibly reach the $1 million mark that so many of us are convinced we’ll need in our super before we can retire. But perhaps she doesn’t need to. According to AMP, the average super balance for men aged 40-44 is $134,992 and for women it’s $98,572. By the time they reach 50-54, it’s $242,007 and $159,188 respectively. Now, Karren’s figure of $154,000 is certainly an outlier for a woman aged under 40. And in 10 years this total would likely be around $286,000 (with 6% returns and current contribution levels) whereas the average for a woman in the 50-year age group…
simpler, fairer tax deduction
Australians spend $2.3 billion annually on their tax affairs. And we have one of the highest rates of tax agent use globally. At Blueprint Institute, a think tank, we recently called for a $3000 standard deduction to simplify most taxpayers’ affairs. Under our proposal, people with deductions higher than $3000 could opt out, claiming their full itemised deduction. But 11 million people would be better off, receiving an average tax cut of $400-$1000. This would eliminate $4 billion in compliance costs and seven to nine million tax returns. No taxpayer would lose out. But low- and middle-income earners would benefit proportionally more. Men and women would benefit fairly equally, with women better off at higher income levels. The standard deduction also improves “horizontal equity” – the idea that two people in similar…
