I have an industry super fund in accumulation mode with both a balanced investment component and cash. I'm in the fortunate position where I don't need the money.
I used AI to help do some calculations and also created my own spreadsheets. I wanted to understand the tradeoffs between shifting to pension mode and having to drawdown versus leaving the fund in accumulation mode just taking advantage of the low tax rate.
In one spreadsheet I just assumed a fix rate of return for the balanced investment and in the other used data related to the variations in return quoted by the super fund over the previous 20 years - some very good years and others with negative returns. I also included the effect of investing money drawn down in term deposits outside of super.
Using a fixed (average) rate told me that I should switch to pension mode.
Interestingly over 20 years - assuming I live that long - I came out ahead leaving the fund in accumulation mode when I used the varying rate of return.
I have an industry super fund in accumulation mode with both a balanced investment component and cash. I'm in the fortunate position where I don't need the money.
I used AI to help do some calculations and also created my own spreadsheets. I wanted to understand the tradeoffs between shifting to pension mode and having to drawdown versus leaving the fund in accumulation mode just taking advantage of the low tax rate.
In one spreadsheet I just assumed a fix rate of return for the balanced investment and in the other used data related to the variations in return quoted by the super fund over the previous 20 years - some very good years and others with negative returns. I also included the effect of investing money drawn down in term deposits outside of super.
Using a fixed (average) rate told me that I should switch to pension mode.
Interestingly over 20 years - assuming I live that long - I came out ahead leaving the fund in accumulation mode when I used the varying rate of return.