Invest cash in super or not?

drprox on 15/05/2014 - 10:07

hi all,

hoping someone can provide me a quick overview of their understanding of the following option I'm presented with. I have an investment property which I'll be selling later this year which will hopefully leave me with around $100k. I can't decide whether to lump most of this into my super fund or keep it invested independently.

I'm 30 years old and the house i live in could use some work so might leave some out for this but otherwise really just wondering what the advantage is in having this in my super vs keeping it out seeing as it will be after tax anyway.

note: I'm aware that people here will not likely want to provide "advice" but perhaps just any thoughts and understanding they have. I'll speak with my accountant later in the year anyway.

thanks,

Financial

Comments

  • grog on 15/05/2014 - 10:15
    +1

    Use the $100k to pay off any debts you may have.

    At 30 it is too early too put that much money into super.

    Maybe a term deposit or online cash saver account for the remainder.

    • mboks on 15/05/2014 - 12:34

      Agree on paying off the debts first then investing the rest of the cash in shorter term ventures.You can't go wrong with real estate, check out publications such as 'smart investor' for indications of what's happening or growth potential areas.Term deposit rates have fallen in recent years.Better off checking out best rates on 'promo' online savings accounts or other higher interest savings accounts that would mean generally not touching your lumpsome for periods of time without necessarily locking you in as you consider other financial options and you need access to your money quick..These online saver promo rates are sometimes significantly higher than term deposit rates by a whole percentage in some cases.only thing you might need to do is keep an eye on the rates every 6 months or so and you can bounce your money to whoever's offering the best rates at the time.

  • siraitken on 15/05/2014 - 10:18
    +1

    As you are still young I would not put your money into super.

    Cash is king and by having cash (even in short term investment form - ie shares) you will have much greater flexibility with financial decisions.

    These decisions include deposits on houses, getting married, having kids, holidays, etc.

    If you are cash poor you will be relying on obtaining finance which may come at a high cost or limited amount.

    If you really want to put money in your super start sacrificing your salary & after tax you may end up better off.

    Let us know what you end up doing.

  • cuteseal on 15/05/2014 - 10:29

    Yeah leave some in cash and invest the rest high growth or aggressive managed funds for the short-medium term. Mine has gone up 10% since the start of the year.

    Flexibility is key at this stage of life - no point locking away your money for 30-40 years.

  • drprox on 15/05/2014 - 11:23
    +1

    cheers all, some good advice there. My old man was the one pushing me to put into super but i'm certainly very cash poor at the moment! one trip to the dentist yesterday reminded me of that…
    Thinking perhaps an ETF, like some of the vanguard options. Or some quality blue chips with solid divs for a good portion now :)

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