Property in Super: The Reality Check No One's Talking About
Property in Super: The Reality Check No One's Talking About
Let's have a yarn about something that's been catching fire lately 🔥 – property in super. While everyone's jumping on the bandwagon, there are a few home truths we need to put on the table.
The Super-Property Love Affair: What's Really Going On?
Sure, bricks and mortar feel safe 🏘️. It's tangible. You can drive past it. Take a selfie in front of it. But when it comes to your retirement strategy, especially if you're nudging 60 ⏰, there's more to consider than just getting your hands on an investment property.
The Cash Flow Conundrum
Here's what the property spruikers aren't keen to mention over their fancy lunch seminars: When you're looking at retirement, property in super isn't quite the golden ticket it's made out to be. Think about it – you need your super to actually pay you money (shocking, right?). Property doesn't magically turn into cash flow when you need it, and those mandatory pension payments? They couldn't care less if your money's tied up in a beautiful beachside apartment.
The Numbers Nobody Mentions
The rules around super are pretty clear cut, even if they're not widely understood. Once you hit 65, you'll need to withdraw 5% of your balance if you want your returns to be tax-free ⚠️. This isn't a suggestion – it's mandatory. By the time you're 75, that percentage jumps to 6% 📈, and if you make it to 85 (which, let's face it, many of us will), you're looking at pulling out 9%. Try achieving those minimum withdrawals when your money's tied up in property 🏦.
Time: Your Friend or Foe?
When it comes to property investment, time isn't just money – it's everything. Here's the reality check:
Property's a long game. We're talking 10-15 years minimum to see decent capital growth on a typical buy and hold strategy 📊
Market cycles don't care about your retirement plans 🎢
The property market moves at its own pace, not yours ⏳
The Reality Check
Property in super isn't necessarily wrong – it's just not right for everyone, especially if you're closer to retirement than to your first job. Sometimes the smartest investment decision is knowing when to swim against the tide.
What Now?
Before you get swept up in property fever 🌡️, sit down and have a proper think about your retirement. What do you actually need your super to do for you? How will you manage those mandatory withdrawals? Most importantly, is there a smarter way to use your super that doesn't involve trying to sell a property in a hurry when you need the cash? 💡
Maybe it’s time for a chat 🚀
https://wealth.cooeewealth.com.au/widget/groups/cooee-wealth-partners
