Your super won't make you rich. And if you're counting on
it to fund your retirement, you're setting yourself up for a massive disappointment.
I know that's not what you've been told. The government tells you to contribute
more. The banks tell you it's your safety net. The financial advisors tell
you it's the smartest thing you can do. They're wrong. The truth is
your super is locked away for decades. It's taxed. It's restricted.
And even if you max out your contributions, the average Australian retires
with less than $400,000. It's not wealth that's
barely enough to survive. So the question becomes, what
are some other options that can increase your income by 50%, 100%, 300% on
top of your super? Something you control, something that compounds faster
than any super fund. ever will. And in this video, I'm
going to show you exactly what it is, why your super won't make you
rich, and what you should be doing instead of to build real wealth
that you can actually use. So firstly, what is
super designed to do? What is it? Most people have no
flippin idea what superannuation is. Most people
think it's a big bowl of soup money that
they send away over 40 years, and then when they turn 65, boom,
Where's my money you're going to send me? They don't understand that it's actually cash
that their employee contributes to a fund and
the fund invests in assets. Assets including stocks,
mainly stocks. It's in property. It's in infrastructure.
It's in private equity. It can be in bonds, of course, a lot of bonds. It
can be in cash sometimes. So it's the value of
the assets that the super fund buys. and
their ability to compound, that actually can build wealth. The challenge
with it is you don't know where it is. You don't know who's managing it,
how much it costs per year, what the performance is, and whether it's locked away in
low-risk bonds and it's not going to compound for you. So it's very
uncertain to know how well it's going to compound. And the challenge is,
too, that the contributions probably aren't enough for it
to be life-changing wealth creation. but
it's not bad, it's a forced savings vehicle. I actually think
superannuation is great for people who need to put away
because Australians can't be trusted with money management from what
I've seen, right? So it's a forced savings vehicle and employers
contribute like 11.5%. So it's a whole pay yourself first mentality
put away into a tax effective vehicle, all right? It's legislated, it's
structured, it's consistent. So over decades in
a nice portfolio, it can compound, it will compound. And
historically, you know, super funds have returned somewhere in the middle digits,
right? Depending on what it owns. It's solid. And it's
designed to provide some buffer in retirement to
replace some of your, well, a few years
of your wage. And it's to alleviate the
reliance on the age pension. It was never designed
to make you wealthy. It was designed to make sure that
you have something at the end and to alleviate the exposure
of the age pension. And by all accounts on those reasons, it's
effective. So I'm for it for those reasons. Okay. However,
it's designed more for preservation than wealth creation. Okay.
So can it also create acceleration? Right.
So let's look at some of the logic around it. If someone earns 80,000 a year, for
example, and superannuation contributions to say, you know,
for arbitrary sakes, 11%, that's roughly about 9,000 annually
before tax. So $9,000 before it's taxed, it
goes in there, but it's also taxed at still a lower rate, but it's still taxed, okay?
Then over 30 to 35 years, it compounds at a tax-free rate,
right? So it will grow tax-free. That's where the benefit is. It's actually a
tax shield. Superannuation is not a big bowl of super money. It's a tax legislation,
okay? However, By the time you access it
at 60 plus and 65 plus, you don't have any active working,
you have less active working years left. So you've actually traded decades of
time, right? And it more aims
at you being comfortable than wealthy. And you've missed the
ability to take the 11% that you would have had in your own pocket and
do things like build businesses, buy
growth oriented assets. and skill
up, investing in yourself, et cetera. And all that, it
disappears over that timeframe, right? And so you get
to that age and you've lost the chance to build freedom for
yourself, all right? So if your goal is to
retire comfortably, fine, you'll be able to do some
stuff, but to live freely, it ain't going to happen, right?
And so here's the real limitation. It's more of a structural issue. Look,
it locks your capital away. That's the challenge. And
you can't access it easily or at all, depending
on what policy you have before the
age of 60 or 65. So whilst it grows, it doesn't give you any
options. Optionality is a huge asset. It's not
just about net worth, it's about optionality. It's being able to walk away
from a job that you hate, toxic environment. It's about taking a risk, starting
a business, taking time off, traveling, investing in opportunities that
arise over time that super doesn't fund. It's
income and accessible, it's cashflow. And all that
optionality disappears. So what good
is a large balance at 65 if you were financially stressed for 35 years?
Does that make sense? What
does create wealth? Let's shift it. If super and
you know it won't make you rich, what will? And there are three things. One,
increasing your income. So for example, if I
focus less on my super and more on my skills
to increase my income and I double my income from $80,000 to $160,000, that is going to
do a lot more for you. Okay.
Second thing, owning productive assets outside super. For
example, if you bought a laundromat, I'm just saying it as an example, I
own one, but it's a 40% return on
money and it will compound and grow in value and give you a lot of
freedom and choice long before super. In fact, you'll probably find it to
give it to you in about five or six years. Okay. And so there's
those opportunities outside super that you may
not be able to get because you have no cash left. And they don't take a
lot of cash down either. But if you have had that superannuation, that
$9,000, perhaps you could have bought something like that, right? Now, I'm not saying all are the same. I
had a student of mine did the same when he bought a gym. And I think to myself, that
was a great decision. He bought a gym. It's basically giving him a level of
freedom outside his job. and it wasn't super
that did that. Just quickly, if you're ready to take control of your finances but feel
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your copy via the link in the show notes and let's get your money working for
you. Now back to the episode. So owning productive assets outside
super is how you do it. And third thing, building scalable
cash flow. So that means that you would want to
be able to invest in assets like that, as well as certain stocks that
provide, even in Australia here, tax-free dividends through imputation credits.
You can do that so you can actually build assets outside super that also
retire you long before 65. And that's the position that I'm
in. So I've done all three of those things. And I sit here
today to tell you that just on our assets alone, my
wife, Alicia, and I, we don't have to work, but I enjoy working.
I like to work on things that I like to work on, whether it be writing books, creative
content, teaching, helping events. building
businesses. I love doing that. It's great fun, right? And it's
great for other people too. But I'm in a position where I
don't have to depend on any super. Just why don't worry about it. And
I'm 42. And I'm really glad that I didn't just
go through life with the notion that, oh, it's OK, I'm just going to fall back on my
super at 65. I don't give a rat about super.
I just don't care. Because I've built freedom already at 42 instead
of banking on someone else managing my money until 65 and then coming out
with 400K. That just, to me, was not a way to live life. I
wanted to live life better earlier. I wanted to go skiing
in Japan when I wanted. I wanted to work in areas I wanted to work in. I
wanted to work with people I enjoy working with. I wanted to have optionality. And
so I decided that I wasn't going to bank on super. I was going to bank on my own
skills, my own ambition and buy productive assets outside
super and build scalable cashflow. And now we have it. And
so without too much more effort, that'll scale far beyond what a super fund
can scale to. You are your best asset. You are your best
investment. there are far superior ways to building wealth than just superannuation, right?
So increasing income is effective. It's the biggest wealth lever that
you can pull. It's got earnings power, you can double your income, you
can quadruple your income, right? I've got friends of mine that have 10 extra income, right?
It allows you better capacity to invest more, to acquire assets,
to build better buffers. Right. It will just do so
much for you then banking on super. So I think that's
the biggest lever you can pull. Right. If you can then take
that and own productive assets outside super
long before the age of 65, there'll be shares, businesses, property, equity,
and private ventures. It'll amplify your income again and again and
again, but give you superior assets that compound far beyond 10% as
well. Right. They're more, they are still liquid. They're strategic. They're
accessible. You can touch them. You can sell them. You can do all sorts of things. Right.
And of course, being able to develop those smaller incomes,
it just will create so much more for you. Like when I first created a network marketing
side hustle, that's brought into my wife and I over
$2 million in profits. And that's far better than superannuation,
right? In fact, it as an asset is superior to superannuation, period.
Okay? You've got to look at where people
have built wealth. It's entrepreneurs, it's business owners, it's equity
holders. They didn't get rich through retirement funds. They
got rich through ownership of businesses, equity, scalable systems,
investing in themselves, skills, and assets that grow way beyond
their labor and time. and they become super passive. So ownership
is superior and active ownership is where you get outsized
returns. So if the wealthiest people built businesses and
assets and got equity and became owners, why would you solely rely
on a retirement vehicle? Now, I'm not saying ignore it
completely like I do, but I'm saying if you're
going to have it, of Of course, if you're in a job, in a wage job, you
still wanna maximize your pull-in contributions, you still wanna optimize your fees, you still
wanna choose appropriate allocations to make sure it compounds effectively, right?
But understand its role. It's a safety net. It's not
a trampoline, all right? If you wanna build real wealth, income. Invest
outside super, develop skills, take calculated risks, and own equity. That
is the path. That's the part. And it seems riskier,
but I actually contend to say that the other path of comfort that
everyone else is doing is far riskier, right? Who's to say people will
even have jobs in the next 10 years to contribute to
their super because AI might take it because they didn't invest in their own skills.
They didn't buy it and build a business. The best thing to do is control your
own income. You can't do it if you're working for someone. I think that's the biggest risk. But
for some reason, maybe it's because of all the fees they generate, superannuation funds
and banks have seduced you into thinking that you're going to be okay with
super. And the fact is with 400k, you ain't, right? You're
just not, especially if inflation is running at 10%. So your super will
probably take care a little bit of your retirement, but it'll
definitely keep you comfortable. And that's where you will go to die, right? It
will not make you rich. So please focus
on ownership, income growth, scalable assets, outside super,
strategic investing, long-term discipline, and business building,
right? That's where it's gonna come from, amplifying your income, right? Because
if you want freedom before 60, you need a different strategy, you need
something else. So comment below, do you think that
super is enough or are you building wealth outside of it, right?
If you want frameworks that focus on ownership, income, and real financial freedom, hit
the subscribe button, Stay smart. See you in the next episode. Thanks
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