I am retired and have an income stream in place with HESTA.
When covid hit, and superannuation balances plummeted, I panicked and changed my investment into the 'cash and term deposit' option.
As we all know the interest rates earned in cash investment is low low low…
Is it a good time for me to change back into the previous 'basic/usual core pool'?
Superannuation - Income Stream - Advice
barbarella on 02/09/2021 - 12:43
closed Comments
Not even going to go into how much you've missed in recovery since last year, hopefully doesn't impact your retirement plans too much
I'd say you should change it back, but have it at an allocation between defensive and growth that will enable you to not panic when there's another crash - the fact you panicked before suggests you might have been too aggressive for your tolerance pre-COVID.
Maybe you need to be like 50/50 or 30/70 (more in defensive)
Oof thats a big hit to the pocket, i have a few friend's who's dads did this. lost out on the 25-30% recovery.
Unfortunately if you're retired risky investments to recoup this is the last place you'd want to place your money.
Financial advisor is my recommendation
You sold after the drop, locking in the loss and have missed out on the substantial recovery. I would be be looking into getting a professional to handle your finances.
Depends on your risk profile, one strategy is to have a few years income in low risk with the remainder in balanced so you can ride out the lows and take some of the top during the highs. As others have said best get some professional advice.
The common understanding is when one is closer to retirement, one doesn't have the time to recover from market peaks and troughs, so one normally puts their nest egg into capital safe / stable investments.
OP rolled the dice, which by itself is fine because I have seen people in allocated pensions in riskier investments make more than their monthly / annual payments.
Thanks everyone
https://www.hesta.com.au/members/advice/speak-to-an-adviser.…
They are probably fairly "doctrinal" in their advice, but wouldn't hurt.
Probably about a year ago. You have shafted yourself quite severely.
yes get back in now, and sell again after the next 30% correction
No more comments please
Do you have a financial adviser?
A good one is worth every penny and would have advised you strongly not to do what you did.
Oh no…. (not that it'll make you feel any better, but lots of people panic and make this mistake).
Rather than asking here and getting vague responses, I think you'll be much better off going to see the services of a Financial Planner as we don't have visibility of all your details. They'll need to look at things such as timing of your switches, the individual options you had before, the ones you have now and the options you have to choose from. They'll be able to give you advice specific to your own situation - something that we can't do here without you revealing all your personal financial details.