Mercer actuary David Knox says the data used to determine the old age dependency ratio is “totally out of date” and overstates the severity of the problem.
From their inception, SMSFs have always attracted more than their fair share of criticism. Now it’s an ageing membership that’s being used to restrict their numbers.
Rising rates and retirement: The biggest investment stories from 2023
Of The Inside Investor’s top five stories by clicks in 2023, two focussed on superannuation and retirement, major themes that are likely to gain further traction as more Australians than ever prepare to retire over the next decade. Income opportunities were another big draw for a readership contemplating an uncertain economic future.
The most-read story by far was a February look at calls for reform of Australia’s $2.5 trillion superannuation system, an issue the Albanese government has made a key priority and which has stirred controversy in the super and self-managed super fund (SMSF) sectors.
Retirees and those approaching retirement also notched clicks for a story from July that broke down concession cards and other discount schemes available to seniors, even those who don’t qualify for the Age Pension, as higher living costs and concerns over the direction of the economy stayed front and centre for a large swath of the population.
Indeed, the top stories all share a focus on maximising income and savings in a changing environment, from an analysis of term deposits versus shares to a review of exchange-traded fund (ETF) performance to advice on approaching income stocks.
The coming year will likely see these challenges continue to dominate the public consciousness, even as investors prepare for whatever may come next. For now, enjoy a recap of the most engaging stories and themes from a roller-coaster 2023.
1. Super tax breaks for mega-rich to cost $53 billion, as calls for reform grow
Superannuation tax breaks will cost the government nearly $53 billion this year, nearly matching the cost of the entire age pension program, according to a new analysis that says major reform is needed. Meanwhile, the government has signalled a tightening of super legislation.
2. Term deposit rates rise, but shares may suit better for long term
Five per cent on a one-year term deposit will tempt a lot of investors, and with good reason, but equities have proven their worth over the long term. As ever, experts say, personal needs should guide investment selection.
3. Making the most of concession cards (even if you’re not on the Age Pension)
Following an increase in income test thresholds, many more Australians are now eligible for the Commonwealth Seniors Health Card and other concession schemes that provide valuable discounts. But many don’t realise they qualify even if they’re too wealthy to receive the Age Pension.
4. The best and worst ETFs from 2022
Exchange-traded funds continued to attract inflows from investors in 2022, albeit at a slower pace thanks to rising interest rates and market volatility. Resources and mining-focused funds were clear standouts in a challenging year.
5. Income stocks still a smart defensive play, but look beyond miners and banks
Dividend investing can be a good source of defensive income in volatile times, but changing fundamentals mean resources companies and banks may be the weaker play in 2023, with opportunities emerging beyond these traditional Australian dividend payers – although valuation will be key.
