Super:Why the watchdog is barking

It all seems to add up to a good- if desperate – idea.

Like thousands of other Australians, this global economic crisis has left you strapped for cash.

But there are still bills to pay.

And there is that pot of gold, that’s just sitting there, tied up in  your super.

Besides, as recent events have shown, you couldn’t do any worse at managing your super than that damned fund you are in.

It all seems so reasonable.

Why not cash it out early, take a bit out to tide you over these bad times, and put the rest into a self managed super fund, to provide for your retirement?

You could hardly do worse than those, so-called professionals, who are managing your super now  could you?

Well, actually, yes.

There are problems with these ideas.  Big ones.  In many cases, taking early access to you super is simply illegal.  Then there are the tax complicati0ns.  These, too,  are serious.

But this adviser is telling me that he can guide me through all that.  So what’s the problem?

One, is that he won’t be doing it for free.  The commissions charged, in setting up a self managed fund, this way, can be very large.

There is also the risk of outright theft, of your super, as your superannuation money is being moved.

So where can you go, for good advice on all this?

The Australian Securities and Investment Commission has some excellent advice on its consumer website, called Fido.  (Go first to www.asic.gov.au, then follow the prompts).

The fifteen minutes this will cost you could well be the best investment you make this week.

It’s all in simple language.

“Sometimes, when you are in financial trouble, it might seem like a solution to access your super,” Fido says.

“But, depending on your situati0n, this may not be the best way to help you out of your financial trouble,” it adds.

Fido says you might do better to make an application for a hardship variation.

What’s that?

A trip to the website, to find out, might well be a very good idea, indeed.