Starting in the Share Market … By Raiding My Super

Hi Scott,

Now that we can take money out of our super, can I run a plan past you? I am thinking of taking out the maximum $20,000 from my super and using it to buy a mixed bag of shares, since the market has fallen so much. I am 34, so there is plenty of time for it to compound. The value would grow like it was still in super but without all the fees and charges, right? Thanks,

Jane

Jane,

No, No, No, No, No, No, No … just freaking NO.

Jane, you’re doing it all wrong.

Your question is taking me to a bad place where I haven’t been for a good 12 months.

Seriously, I knew I was in trouble when my mum rang me last year and scolded me:

“Scott, I think you’re being a little rude to your questioners lately.” True story.

Since then I’ve been chanting ‘serenity now’ affirmations when people ask me what I politely refer to as ‘Bob Katter questions’.

But you’ve really tipped me off. I feel like I’m John McEnroe on a line call: “You cannot be serious!”

You want to take money out of your super, where it’s taxed at an incredibly low rate.

Where it’s protected from bankruptcy.

Where you’ll eventually retire and pay ZERO tax...… And you want to put that money into shares in your own name?

Where you’ll be taxed at a higher rate.  Where you’ll likely pay higher fees.Where you’ll probably one day scratch the itch and sell them, then ‘invest’ the money in a banana lounge from Harvey Norman because it’s on sale.

No, Jane. Just no.Here’s what I want you to do:

Do NOT touch your super.

Fact is, you are already investing in shares — via your super!If you’re going to do anything, just make sure you choose a super fund with ultra-low fees.

And that’s the same advice I give my beautiful mum.

Scott