*&^%$^* the Labor Government

Hi Scott,

I’m writing on behalf of my mum, who is distressed about the upcoming changes to superannuation. She is a widower who has worked hard all her life, saving like crazy to ensure she had a secure retirement (believing it was her responsibility not to be a burden to society via the pension) and to leave a tidy nest egg for her kids.
 
Mum has been advised by her accountant that she is a smidge over the $3 million cap; once he wraps his head around the changes he will, I’m sure, offer her excellent advice on how to proceed. But here is my question: what the *&^%$^* is the Labor Government thinking about attacking the little nest eggs of ordinary Australians? And what the **&^^% is anyone doing about it? It appears that, despite negative press attention, the changes are going full steam ahead. It’s just not fair! Thanks for listening, Scott, as no-one else seems to be hearing our small voices of protest.
 
Linda
 
Hi Linda
 
I’m sure your mum must feel like she’s being unfairly targeted … and her only ‘crime’ was that she worked hard, saved harder, and made savvy financial decisions! After all, she could have just peed all her money against the wall and retired on the full pension, right?
 
Well, that’s true.
 
Yet what’s also true is that your mother is not “an ordinary Australian” and she does not have a “little nest egg”. She’s got more cheese stuffed in her super than 99.5% of the population!
 
And besides, as you’ve said, she has access to an accountant who will dutifully work out a way to siphon that ‘smidge’ of the tax-affected part of her $3 million balance into another low-tax environment.
 
So she’s going to be absolutely fine.
 
However, what most Australians are really worried about – and what the media have jumped on – is whether this move by the Government is the ‘thin edge of the wedge’.
 
So, is the media right? Is the Government really aiming to come after your super?
 
Bloody oath they are!  
 
Yet that’s hardly breaking news. After all, with each passing year, politicians – on both sides – have made super less attractive. Especially for higher income earners. They’ve deliberately limited the amount you can put in each year and how much you can keep in there, and now they’re upping the taxes.
 
My take?
 
They’ll keep doing it. 
 
Reason being, Australia has a rapidly aging population. Looking after old people is expensive. As are programs like the NDIS. Someone needs to pay for it, and the heavy lifting will come from the wealthiest people in our country. 
 
So to your question: what’s the Labor Government doing attacking the little nest eggs of ordinary Australians? 
 
They’re not.
 
It’s just that the Government isn’t in the business of providing a tax haven for wealthy people.
 
Or helping your mum provide a tax-effective inheritance for you.
 
The Government’s end game is for super to (hopefully one day) take some heat off the age pension.
 
So let’s talk about the “little nest eggs of ordinary Australians”:
 
The median super balance for Aussies aged 60–64 is just $139,056 for women and $180,928 for men … and many of these people will have to use their super to pay off their home loan when they retire!
 
Now that’s tough!

Scott