More hogwash from the Fairfax press here.
http://www.smh.com.au/money/super-a...m-is-plenty-to-retire-on-20150420-1mowtv.html
http://www.smh.com.au/money/super-a...m-is-plenty-to-retire-on-20150420-1mowtv.html
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More hogwash from the Fairfax press here.
http://www.smh.com.au/money/super-a...m-is-plenty-to-retire-on-20150420-1mowtv.html
More hogwash from the Fairfax press here.
http://www.smh.com.au/money/super-a...m-is-plenty-to-retire-on-20150420-1mowtv.html
If you leverage $1M, you can buy a $3M commercial IP that makes 8% and costs you 7% (of the loan) including costs.
So this would get you $100k in the first year.
Very rough example, but it shows that it's plenty to live on.
I've figured out that I'd want about $2.5M in unencumbered property assets outside my own home for my own retirement.
This would deliver an income of at least $100k. You could do it on less via the share markets, but that's also more volatile in both capital gains (which is not a concern) and dividend yield (which is a concern).
More hogwash from the Fairfax press here.
http://www.smh.com.au/money/super-a...m-is-plenty-to-retire-on-20150420-1mowtv.html
$1m in shares split across a couple, paying fully franked 4% yields would result in roughly $57k tax free income indefinitely without drawing down capital.
I don't think everyone here realises how generous the age pension is....
as a couple you can have $285,000 in assets and still get the full pension of $33,000 pa.
So if you retire at age 65 with $285,000 in super and can generate a 6% return on your investment you will have an income of $33,000 + $17,000 = $50,000 pa without your capital reducing. (although inflation will erode it over time....)
Be careful when planning your old age with the mind of a young person. For most people there's a change in risk acceptance around the time you go into retirement. When previously >6% investment income was the norm, at age 65 you'd be likely looking at 3-5%.
Fixed interest nowadays earn only 2-3%, unencumbered property 3-4%. As for shares most financial planners will advise you to keep 3 years' living expenses in cash so as to get through market slumps without selling your holdings.
So with 1M many people would probably have 150K in cash, a further 200K in fixed interest and only 650K in shares and property. High overall returns are out of the window.