Last Sunday on the show, we interviewed the federal Minister for Superannuation and Corporate Law Mr Nick Sherry…

Kel, (Our radio show anchor and web guy) has been a little ill since the interviewed aired so apologize for the delay in the posting of the audio.

For those of you that tuned into Money Matters Sunday you’ll notice that there’s an extra 3 minutes of audio on the podcast….I’d like to say it’s bonus content, but it’s just the raw unedited version of the interview….

you can listen to the interview by clicking the play button below or choose the download option and listen to it later…..This is a must listen for anyone concerned about your Superannuation….

Enjoy.

 

 Senator Nick Sherry Interview [8:38m]: Play Now | Play in Popup | Download

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Q. I have approx $100,000 in Superannuation and I want to retire at the end of the financial year this year. I turned 60 at the end of May. Do I have to invest in a particular income stream for it to be tax free or can I withdraw my Super & put it into, say, ING at 7.9% & draw a small income from this & still be tax free? Do I pay tax on the interest the money earns in the account? I would appreciate your advice.

Josie’s answer: Thanks for the question and congratulations on seeking advice and doing your homework.   Far too often we see people making financial decisions without really understanding the impact on their future wealth.

In order to be sure your income will be tax free, it needs to stay within the superannuation environment.   It is common for people to transfer their super to an Continued

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Q. Hi Josie, I was sitting on the tractor working away the other night and I was listening to you on the radio. I am from NZ, currently working here for a while. I was wondering how I go about claiming tax back? I have also worked here in the past (a couple of years ago) and am wondering if I can claim anything from that work? Please help as it is hard to find information on this. Your time is very much appreciated.

Josie’s answer: Thanks for the question and what an interesting job?   Questions on taxation of non-residents should really be directed to an accountant as they just love interpreting the Tax Act.   Nevertheless, I have done a little bit of research on the Continued

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Q. My son worked at Macdonalds for 4 years and has a superannuation with employer contributions. He is now doing full time study at uni. Should he do something with this superannuation before it is eaten away with fees?

Josie’s answer: I just love it when people are conscious of fees within their superannuation fund. As you know there are far too many people who simply don’t care and then years later wonder what happened.

Just wish they understood that if you are in the wrong super fund, fees can easily strip 20% of your final retirement benefit (just imagine a slow drip from a tap - very soon the bucket is full and in this case the bucket belongs to the financial institution and in some Continued

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Q. On your radio segment on the 1st June 2008 I only heard the end of a comment about pension age people who are not taking the pension but are being rewarded somehow.

As I missed the bulk of the conversation would you be able to provide some more information or direct me to a website. Some background for you.

My pension age parents and myself are farmers and as my parents have a large asset base they are inelligible for the age pension amongst other benefits.

As the farm is to be handed down to me, the “asset” is really a business. They refuse to give any asset away before the execution of their will and as such haven’t planned ahead for this situation.

Josie’s answer: You are referring to the Pension Bonus Scheme (PBS) which has been in operation since 1998 and just like yourself very few people have even heard of it.

The PBS is to reward people who work past age pension age, currently 65 years if Continued

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Q. Can u tell me, at what birth year does the aged pension stop. I was born in 1964 and need to know whether I will receive the aged pension.

Josie’s answer: A great question and I suspect many people reading this question will think you have gone bananas. Most Aussies have the attitude that it is their god given right to receive the age pension as they have paid taxes all their life.

A fair point, but there is only so much money in the Government kitty. Remember they are simply managers of the tax we have to pay them.

A huge problem facing most Governments is Continued

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Q. Husband and self over 50.sold home have $50,000 leftover. We have $250,00 new mortgage with $30,000 in offset acct.
We’re currently spending offset money improving house to use for selling when retire. have no superannuation (self employed).
We have no great aspirations when retire, family around just want to live & pay bills no liabilities except mortgage & business vehicle.

How can we use $50,000 wisely now. My Husband is able to do all renovations to home himself…..current value of home approx $500,000. thanks

Josie’s answer: Assuming I am interpreting your question right, your main question is that you have $50,000 sitting in a savings account. On top of this, you have $30,000 in an offset account which effectively means you are paying interest on $220,000, rather than $250,000.

My initial thoughts include:

• Why haven’t you topped up the offset account by $50,000? If you do this, your bank will be charging interest on $180,000 ($250K - $30K - $50K). I particularly like this strategy because the interest on the home that you are living in is not tax deductible. Also, you are paying in ‘after tax dollars’, i.e. your net pay.
• If you invest the $50K you need to think about your time frame and what you have to do with the funds e.g. term deposit, managed funds. Investment markets are Continued

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  Tags: tax benefits associated with superannuation., transition to retirement

Q. Hi Josie, my husband and I are really struggling putting together a household Budget. Any suggestions?

Josie’s answer: Maybe you are setting unrealistic goals. Can’t believe I am saying this, but maybe you are foregoing too many luxuries and you are extremely bored.

Just like dieting, if you ate that piece of chocolate cake, it doesn’t mean you have to throw away the whole diet.

For example, you don’t have to give up going to the movies, just go when they have cheap nights. Your budget Continued

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Q. I’m 56 years old, separated and I want to buy a unit. My husband brought a house before we met. When we brought a house together we were not entitled to the first home buyers grant because he used it when he brought his first house. My question is: am I entitled to the grant, because I have never technically had one.

Josie’s answer: I can understand why you are keen to explore the possibility of obtaining the first home owners grant which is currently $7,000. It would certainly help to buy the unit you are interested in purchasing.

The First Home Owner’s grant is a Federal government initiative and administered by each State and Territory. From my understanding of the rules, if your ex-husband owned a home before you were married, technically you did not hold a relevant interest, i.e. your Continued

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