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Old 01-09-2019, 06:52 PM   #6
Risto the Great
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Join Date: Sep 2008
Location: Macedonian Colony of Australia
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Quote:
Originally Posted by Gocka View Post
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.

Quote:
Originally Posted by Gocka View Post
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.
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Risto the Great
MACEDONIA:ANHEDONIA
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