Hello, I am 59 and want to start planning for my retirement. I would like to get some feedback in relation to the proposed changes to superannuation if the Labour government wins the next election. I have $400,000 in super and now quite nervous about how it might affect my retirement plans. Can someone provide some advice?

Hi Julie,
It will be well worth having a plan to meet your short and medium term needs but I wouldn’t be worried about political noise.
Any actions you take will put you in a stronger position regardless of any changes.
It is just my opinion but neither party will be silly enough to mess with retirement savings other than at the edges of benefit limits
Best of luck
Scott

Hi Julie,

It’s great that you’re starting to plan for retirement. Too many people don’t, they just retire and hope for the best.

Labour has proposed to abolish the refund of excess framing credits, for those that aren’t on the age pension.

Franking credits are tax paid by companies on any profits they make, before paying dividends to you. It’s a way of avoiding double taxation.

What the retirees are so upset about is this refund was extra income on their investments (likely through their super) that they lived on. So for a retiree to keep drawing the same income under these proposed rules, as they did previously they will need to draw on more of their capital - which in turn will see their capital base run down faster, making them eligible for an age pension sooner.

At this stage it’s just proposal so I wouldn’t worry too much. In all likelihood there will be many changes to the retirement/super/pension system over the next 30 years you need to be planning for. You just need to be able to adjust to the changes when they occur.

Please let me know if I can help any further.

Regards
James
James.wrigley@firstfinancial.com.au
03 9909 5800