Life must be rather frightening for those facing retirement in the months ahead. Compulsory superannuation has been in force for over twenty years, hence those about to retire know that there should be a nest egg awaiting them.
The problem is that it's size is shrouded in mystery !
The unknown factor is what toxic CDO content is hidden away in superannuation fund assets. This is labelled " commercial confidentiality"and is not spoken about in polite circles - and yet that will determine how long the nest egg will support superannuation years.
There is also the question of how it will be treated by Centrelink !
Superannuation has a theoretical value as claimed by the investing company and Centrelink uses this in determining a persons assets. This asset valuation is then used to determine what - if any - pension the retiree is entitled to - and will further determine what fee will be paid when eventually a nursing home admission is necessary.
The problem is that this " theoretical valuation " does not necessarily have any bearing on the true value. Just try selling that asset and you will find that there are no takers at this assumed value.
The true value will only emerge when the funds finally reveal what degree of toxic assets make up their balance - and that will not happen until the government plans finally result in those CDO's being dragged kicking and screaming into the cold, hard light of day for disposal.
Until that happens - people about to retire do so in a fog of mystery !
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