Investing/Stocks

[Gocka]

I've never come across such a thread. I don't know if anyone on this forum actively invests in stocks or the like so I thought I'd find out.

If I had to guess I'd say maybe Chichko Risto.

[Carlin]

I don't actively invest in stocks (no time/too risky) but I do have a couple of mutual funds.

[Phoenix]

Originally Posted by Gocka

I've never come across such a thread. I don't know if anyone on this forum actively invests in stocks or the like so I thought I'd find out.

If I had to guess I'd say maybe Chichko Risto.

Every (legally) working Australian (perhaps not chichkoti Risto) actively (albeit indirectly) invests in stocks through their superannuation plans/schemes...like your 401k's etc in the US, I assume???

[Risto the Great]

All of my stock investing is done via my self managed superannuation fund. Market is all over the place and I tend to just hang in there with a solid long term strategy. Been surprisingly good over the last 15 years I would have to say.

[Gocka]

In the USA not everyone has a 401k. Its a non compulsory pension savings vehicle that you invest in at your own choice. Many employers have a company sponsored 401k where the company will match your contributions to your 401k, usually between 2-4% of your salary. 401k's are usually invested in funds and bonds, never in individual stocks. The main benefit of such a plan is deferred taxation on your and your employer's contributions to the account.

Our compulsory pension system is social security, which is automatically deducted from you pay ever pay period. Currently that is 6.2%


I'm surprised no one invests directly in stocks. Is the Australian stock market unstable? The American stock market is quite steady, long term of course. As long as you don't treat it as a slot machine and actually do some due diligence, its not to hard to be on the winning side.

What do you guys do with your saving? Interest on savings accounts is usually negative vs inflation.

[Risto the Great]

Originally Posted by Gocka

In the USA not everyone has a 401k. Its a non compulsory pension savings vehicle that you invest in at your own choice. Many employers have a company sponsored 401k where the company will match your contributions to your 401k, usually between 2-4% of your salary. 401k's are usually invested in funds and bonds, never in individual stocks. The main benefit of such a plan is deferred taxation on your and your employer's contributions to the account.

Our compulsory pension system is social security, which is automatically deducted from you pay ever pay period. Currently that is 6.2%

Over here 9.5% is compulsorily deducted from your salary package. You won't normally be able to access it until you are at least 60 years old. It is taxed at 15% on the way in (usually) unless you are a high income earner.

The successive governments have hoped you will have enough superannuation so as not to be eligible for a pension from the government.

Originally Posted by Gocka

I'm surprised no one invests directly in stocks. Is the Australian stock market unstable? The American stock market is quite steady, long term of course. As long as you don't treat it as a slot machine and actually do some due diligence, its not to hard to be on the winning side.

What do you guys do with your saving? Interest on savings accounts is usually negative vs inflation.

The Australian stockmarket is one of the most mature and stable equity markets in the world. I believe the sharemarket is ranked in the top 6 in the world (from memory) as far as size goes, which is quite amazing for a population of 25 million people.

Most people do not have savings. I would thought the entire western world is pretty much the same in this regard.

A common strategy here is to accumulate property with the taxation benefits of negative gearing. More of a bricks and mortar approach to accumulating wealth.

[Gocka]

Does the employer contribute in Australia? Our 6.2% is the employee portion, the employer also pays 6.2% on your wages. Also its capped to the first roughly $120,000. Income over that is exempt from that tax.

One idiotic aspect of our system is that everyone receives a government pension regardless of income. So even the wealthiest people who have substantial income through retirement can collect a full government pension on top of it. Pretty much all Americans need it anyway because the cost of living is high and most people don't save a penny on their own.

Originally Posted by Risto the Great

Over here 9.5% is compulsorily deducted from your salary package. You won't normally be able to access it until you are at least 60 years old. It is taxed at 15% on the way in (usually) unless you are a high income earner.

People used to put their wealth into brick and mortar but that has become difficult for most because the spread between salaries and properties values has become so large.

I have a grandmother who along with her husband bough a small apartment building in Manhattan back in the early 70's for a mere $80,000. She recently sold it in very shabby condition for $5,000,000 a 60 fold increase. In the same time period the average salary has tripled maybe quadrupled. Funny side note, the same Grandmother, who hardly speaks two words of English and is illiterate, was pre-approved for an $80,000,000 bank loan to purchase another property.

Reverse mortgages are becoming popular for old folks with homes.

You are right, most people don't have any savings.

I have to make my money work for me, because god knows that I don't want to.

Most people do not have savings. I would thought the entire western world is pretty much the same in this regard.

A common strategy here is to accumulate property with the taxation benefits of negative gearing. More of a bricks and mortar approach to accumulating wealth.

[Phoenix]

Originally Posted by Gocka

...Does the employer contribute in Australia? Our 6.2% is the employee portion, the employer also pays 6.2% on your wages. Also its capped to the first roughly $120,000. Income over that is exempt from that tax...

In Australia the employer contributes 9.5% of the employees salary into the employees superannuation policy...the employee can also contribute money either pre-tax (salary sacrifice) or post tax and even lump sum payments...each of these methods are effected by certain tax implications, with the rules constantly changing each time a new government is elected.

The superannuation scheme in Australia has been a stroke of genius and has been in place since the early 90's as a compulsory savings system to be used in retirement.

The Australian superannuation industry currently holds assets nearing AU $3 trillion...

[Risto the Great]

Originally Posted by Gocka

One idiotic aspect of our system is that everyone receives a government pension regardless of income.

I actually would like to see that here.
It gets rid of the incentive to live it up and then demand the government handouts. I see plenty of self funded retirees doing it tough and still not being eligible for pensions because they bothered to suffer and save for retirement.

[Statitsa]

Off topic I know, but, Gocka...

Why do you insist on replying first and quoting afterwards?