Initial Current
ING Global Emerging Markets - Entry Fee 10% 1.4382 1.52460
OptiMix Geared Australian Shares Entry Fee 30% 1.2060 1.38040
OptiMix Global Smaller Companies Shares - Entry Fee 10% 1.6289 1.73940
Vanguard Australian Shares Index - Entry Fee 20% 1.2370 1.38410
Vanguard International Shares Index - Entry Fee 20% 1.2491 1.25220
Vanguard Property Securities Index - Entry Fee 10% 1.2090 1.33700
The entry fee for the ING OneAnswer Personal Superannuation scheme is quite hefty (around 4%), but doesn't matter as I made the investment application via Count who rebate the upfront fee 100%.
Total initial investment was $1000, with quarterly additional investments scheduled to start from next July. The current value of the investment is $1,091.
When DS2 is older I'll help him find a casual job, such as delivering letter box junk mail on the weekends. Although it is quite easy for kids to earn some pocket money doing odd jobs, it's a much harder task finding a "real" casual job for the under-15s. The benefit of having such a job (apart from the life lessons around working, earning money etc.) is that if he earns more than 10% of his income working for an employer he can make an undeducted contribution of up to $1000 each year and get a government co-contribution of up to $1500 per annum.
I already did this for a couple of years with DS1 while he had a job doing a paper round. Boosting retirement savings at such an early age should have a huge impact on their final benefits, as they have 60 years for the magic of compounding to do it's thing.
Enough Wealth
2 comments:
It should be up to the individual to earn their own retirement funds and allocate investments appropriately.
I don't think DS1 is in a position to earn his own money at age 7 months ;)
He also needs to learn how to allocate investments appropriately.
I plan on discussing his asset allocation as part of his education. Having a real account as an example is a better teaching tool than just discussing these things in theory. As he gets older we can discuss changes to the asset mix, and once he turns 18 the account is totally under his control in terms of asset allocation and making additional contributions.
The good thing about a superannuation account for kids in Australia is that you can't withdraw funds from superannuation until retirement age, so he won't be able to take the cash out and buy a sports car when he turns 18!
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