It’s the second Tuesday of May and finance nerds around the country are writhing with excitement and anticipation for what is widely acknowledged to be one of the most important federal budgets in recent history.
When the budget is released only hours from now, the spotlight will likely shine on three key issues: the deficit levy, welfare cuts and the asset test for pensioners. The last point moulds the theme of today’s article, with a particular focus on the ageing Australian population. Yes, we have a deficit, but it in no way compares to that of the United States or many of our European allies. However, an ageing population increasingly dependent on social welfare will place sustained fiscal pressure on the Australian economy.
Figures from the Australian Bureau of Statistics show that almost 45 per cent of those retired for between 0 and 4 years are dependent on social welfare. This figure jumps to 66.1 per cent for those retired for between 10 and 14 years and 73.5 per cent for those retired for between 20 and 24 years. Of course, these figures are likely to decline in the future as the benefits of super are realised for future generations of retirees, although the opposing force of an aging population is likely to inhibit these benefits from being realised in full.
What is a certainty is that the ageing population will have a profound impact on the demographic face of Australia as well as fuel interest in the fastest growing sector of the superannuation industry – self managed superannuation. With the vision of living a comfortable, non welfare dependent retirement, more and more Australians are also taking a close look at how they can invest in property within their super, which provides the opportunity of a TAX FREE sale in retirement.
Book a meeting with Blue Wealth to find out how we, with the help of an accountant, can help your client invest in property through super.