Hi Sam, Not to discredit your post because most of it was right eg about employer-sponsored pension schemes (and you are right both muni and private corporation pensions are chronically underfunded AND WORSE can change after the fact eg Detroit everyone took a haircut and they dropped a pension by 20-40% can you imagine being a muni fireman in Detroit for 40 years, retired and then said oh yeh all those sacrifices….we are dropping your pension 20%......some politicians house would be on fire that night if it happened to me……).
Having said that what I wanted to say is that in the USA you can CHOOSE to put personal savings into both pre and post tax 401k (superannuation)…..however the limits are low •$17,500 in 2014 and $18,000 in 2015 (if over 50 you can kick in a bit more). There are a lot of benefits to a work place based Roth 401k around maximum contributions but outside the scope of this email. Just wanted to say you can setup and contribute to your own even if your employer doesn’t offer one. Cheers, Dean From: silicon-beach-australia@googlegroups.com [mailto:silicon-beach-australia@googlegroups.com] On Behalf Of Sam Thorp Sent: Wednesday, March 04, 2015 12:57 AM To: silicon-beach-australia@googlegroups.com Subject: Re: [SiliconBeach] Superannuation when becoming a US Citizen There's a lot more to it, obviously. The US system relies on employer-sponsored pension schemes, which are chronically underfunded and have their own host of special problems. The US doesn't have 'optional' superannuation - it just places the burden on the employer, rather than you. In both cases, the government is trying to minimise the liability from people getting to retirement without any money and having to rely on government pensions (as both the USA and Australia have a safety net for the old and broke). This is itself a simplification - there's been a lot of change in the last decade or two, with employers moving towards defined contribution schemes. The Australian system is (as with many aspects of our government) a midpoint between the USA and the Nordic countries compulsory state pensions (there, your employer pays 30% of your income [not including your own personal taxes!] to the government. Everyone then gets a comfortable pension for life after they retire, regardless of savings). Also, on a personal note, holy crap I would never invest my retirement savings in my own business. With the failure rates on small businesses as high as they are, the risk of you losing everything is immense. I mean, I understand being confident in your abilities, but statements like that are exactly why the government locks the money away - to prevent people spending it on high-risk ventures that are likely to completely wipe out all of their savings and leave them destitute. On 4 March 2015 at 16:42, Geoff McQueen | AffinityLive <geoff.mcqu...@affinitylive.com<mailto:geoff.mcqu...@affinitylive.com>> wrote: 9.5% now Patrick. I don't mind as much it is locked away, but it pisses me off as an employer that people don't think about that as part of their salary. It is. Just as the funds paid to a fat and bloated health insurance industry is also a form of their salary which is not part of their gross and thus isn't valued (which explains why it gets such bad bang for buck). Geoff On Tue, Mar 3, 2015 at 8:56 PM, Patrick Collins <pcolli...@gmail.com<mailto:pcolli...@gmail.com>> wrote: I'm off topic, but the mandatory Superannuation scheme vs the optional 401k scheme in the US is a sublime example of the philosophical differences between how the two countries are governed. The US will always favor the individual's choice. Up to you if you want to vote. Up to you if you want a savings fund (401k). EVEN if it means that as a whole the population will be worse off, because not enough people will get to retirement age with enough savings to survive. Well, it was up to you to plan ahead. Australia will always level the playing field for everybody for instance by mandating that all employees stock 8% of their salary away, even if a large chunk of the individuals would rather invest that money themselves (like in their own business ventures). Personally, I get very annoyed that 8% of my income has been locked away. Previously it was locked away in poorly managed super funds being ravaged by fund managers. I set up a SMSF, but it is quite burdensome to deal with. Just abolish the whole shoddy scheme please, or at least allow qualified individuals to completely opt out. Patrick. On 3 March 2015 at 20:33, Sam Thorp <sam.th...@gmail.com<mailto:sam.th...@gmail.com>> wrote: Dean is right - as an Australian citizen, you can't withdraw your super early except in exceptional circumstances (terminal illness, etc - see http://www.humanservices.gov.au/customer/services/centrelink/early-release-of-superannuation). What you may have read is that temporary residents who leave permanently are able to withdraw their accumulated superannuation. I assume that, as a dual-citizen and permanent resident of Australia, you wouldn't be eligible. To quote from the ATO Website: "Departing Australia superannuation payment: Temporary residents who are leaving Australia permanently may be able to claim their super. New Zealand citizens and permanent residents of Australia are not eligible for this payment." https://www.ato.gov.au/Individuals/International-tax-for-individuals/Going-overseas/When-you-leave-Australia/ On 4 March 2015 at 14:52, Dean Collins <d...@cognation.net<mailto:d...@cognation.net>> wrote: Phil, You cant withdraw your super…..not until you are 59 ½. So basically yes the IRS sucks….but in reverse the ATO sucks when it comes to ROTH 401k’s where you prepare tax……basically the way I figure it….i’m 15 years away so we’ll probably have at 3-4 changes in government on either side so who knows what the rules will be in 15-20 years from now…..and that’s why Super sucks….. Cheers, Dean From: silicon-beach-australia@googlegroups.com<mailto:silicon-beach-australia@googlegroups.com> [mailto:silicon-beach-australia@googlegroups.com<mailto:silicon-beach-australia@googlegroups.com>] On Behalf Of Phil M Sent: Sunday, March 01, 2015 2:12 PM To: silicon-beach-australia@googlegroups.com<mailto:silicon-beach-australia@googlegroups.com> Subject: Re: [SiliconBeach] Superannuation when becoming a US Citizen Agree with the sentiment. I have already disclosed my super to the IRS, based on the risk of fines if it was uncovered. Also, my thoughts are similar in that it may be time to withdraw all the super and move it a US investment account, given I am getting an average of 15% gains over the last five years. Phil On Thursday, February 26, 2015 at 11:35:08 PM UTC-8, Dean Collins wrote: You mean if you gave up usa citizenship and moved back to Australia. ...google Heart Taxation Act -----Original Message----- From: Phil M [phil.mo...@majura.com] Received: Thursday, 26 Feb 2015, 2:25PM To: silicon-bea...@googlegroups.com<mailto:silicon-bea...@googlegroups.com> [silicon-bea...@googlegroups.com] Subject: [SiliconBeach] Superannuation when becoming a US Citizen I've asked this before, but was never able to get a good answer. Has anyone done a proper analysis of how the US Government treats superannuation once you are a citizen? Any strategies to deal with? I became a citizen last year and don't intend to go back to Australia permanently (but who knows :-)) Phil -- -- You received this message because you are subscribed to the Silicon Beach Australia mailing list. Vist http://siliconbeachaustralia.org for more Forum rules 1) No lurkers! 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