The Meeting Place

Boomers calling for handouts to fund handouts to their kids

Calls for a universal pension have increased – now led by baby boomers who have had to help their millennial kids cope with the economic hit of coronavirus crisis.

Boomers are accessing their super to help younger Australians who are more likely to work in the hospitality industry, more likely to be casual workers and less likely to have savings or assets of their own, says Young casual workers may also struggle to access JobKeeper payments, as they are only eligible if they have been with their employer for 12 months or more.

Millennials are the number one group to take up early access to their super savings.

As of 11 May, more than half of the almost 1.4 million people who have accessed their super early were under 35, according to new Treasury figures.

Early super withdrawals meant young people would also face long term financial impacts.

“A 30 year old who accesses $20,000 from super now could lose about $100,000 when they hit retirement, and a 40-year-old could lose more than $63,000,” said Labor shadow assistant treasurer Stephen Jones.

“Superannuation is supposed to be our system of preparing us for retirement, ensuring that we relieve the burden on future taxpayers to save for retirement.”

Do you think a universal pension is a fair way to ensure Australians live with dignity in retirement?


Surely the future loss of $100,000 resulting from withdawal of $20,000 now from our 30 yo's Superannuation account needs to be adjusted for inflation over say 30 years?

So it's probably only a lost of $30,000 or so (I'm not sharp enought to do the actual math - just hazarding a guess!)

Situation bad, but not so harsh as portrayed.   Can someone with economics smarts clarify?



It is calculated on compound interest (Interest on Interest) over 37 years.

20,000 + 2%= 20,400

20,400 + 2%= 20,804

20,804 + 2%= 21,220.08

Keep going and it all adds up depending on the interest rate

Those figures are not discounted for inflation so they are meaningless. Future projections need to be discounted cashflow not what one's money will buy today. $100,000 in 30 years time will only buy a fraction of what it does today. 


Use the calculator on this site to see the difference.



Those figures are not discounted for inflation so they are meaningless. Future projections need to be discounted cashflow not what one's money will buy today. $100,000 in 30 years time will only buy a fraction of what it does today. 


Use the calculator on this site to see the difference.



At a growth rate of say 7% then there should be a lot more than the figures shown above after say 20 to 30 years. 

Yep.  Universal pension is the only fair way and many countries do not have the stupid asset test costing govt a fortune in bureaucratic processes !! 

I agree. However the other countries having no means and asset test have less generous tax thresholds and do not provide pension freebies like $6 prescriptions, bulk billing. Universal pension yes, taxation by the ATO. Houses probably would get a bit cheaper and some investments would flow into income producing assets away from real estate only. There would probably an asset tax like in other countries and people in expensive houses would pay a bit more.

Personally I would probably be worse off with that system.

What about  reverse mortgage to get a bit more finance?    Anyone had experience?   


Only as a last resort.  Also check out the centrelink home loan scheme first before going to a private provider

Only really provided in certain post codes. Where I live, no way.

Another thing to consider is: - Once you are successful with a reverse mortgage, you will have to insure your place and keep it up to scratch since you are no longer a sole owner. A few people overlook that.

as a ballpark you could use a method known as 'Rule of 72', which allows you to estimate the time it will take money to double for a given interest rate by dividing it into 72, so @6% $20000 would grow to $40000 in 12 years, $80000 in 24 years so around $115000 in 30 years. You could adjust for inflation by reducing the annual growth rate so assume 3% inflation, the effective growth becomes 3% so it would take 24 years to double to $40000 so approaching $50000 in 30 years. Of course you could just as easily use a financial calculator to calculate the future value (FV).

Universal pension is the only reasonable thing to have and no difference if you are married, defacto or single.

Everyone puts in a tax return and pays tax on it and any extra income whether it comes from employment or bank interest.

Currently $18,599 is tax free plus any offsets like low income or seniors offsets would help. I would like to see the seniors offset gone and keep the low income one.

Hi Star Trecker, what is your reasoning of eliminating senior offsets? - would you be satified with Senior offsets only to low income?   


Seniors would get the low income one as well. You cannot have both.


A universal taxable age pension system is the only way to go. With regard to super withdrawals, the present fiddling & changing of retirement rules mean that super is no longer desireable. If it was, then when the good times return, additional contributions would be made. So simple eh?

Of course it is. Any question that asks; "Do you want more money?" will always elicit a positive response. The question that then has to be put is who is going to pay for it. I note that people are always on about the government should do this; the government should do that but any payments made are provided by taxpayers so if more money is needed then taxpayers will, in one way or another, have to cough up the shortfall.

Thank you Horace for a reality check. 

Giving a pension to someone who has a SMSF with $10milion is a really bad idea.  Its bad enough that tax payers fund a pension for a single retired person who lives in a $5million home, because that doesn't count in the assets test.

Yes, the assets and income tests should be simplified and the deeming rate should be reduced in line with the rates available on bank deposits, but a universal age pension is as sensible as a universal social wage

It is the government who change the retirement rules and so foil the decades spent by people planing their retirement. A taxable universal age pension is needed in order to encourage people to once again plan retirement and stop the missing link stupidity.


Horace Cope, the fair and logical way to pay for a universal pension - which SHOULD be implemented - is by fixing the very unfair superannuation tax concessions. Currently, the high income earners get huge tax concessions for super contributions and earnings. The low income earners get virtually no benefit from concessions, but will probably get a pension. The middle income group might get some tax concessions but no pension so they miss out unfairly. The system needs consistency and fairness. Cut the huge tax concessions at the top end to fund pensions for the middle group who are currently struggling unfairly, and ensure a fair tax system negates the value of any pension paid to the wealthy. 

Rick talks about someone with an SMSF with $10 million. How many such folk are there? I suggest likely none - or if there are, only one or two. The reason for a universal pension is those with an SMSF with about $1 million between a couple They can't earn enough to live on. In a crisis such as we have now, they have to sell assets at a loss to fund living costs.  If people stopped ranting about fantastically wealthy folk who don't exist (retirees with $10 million would never have it in an SMSF) and focused on reality and equity, they would see that a universal pension is highly affordable and a huge social and economic benefit.

Future Gains are a maybe and what interest rate/inflation are crystal ball gazing. Just as easily at this Time could be Zero/Negative plus high inflation or worse Deflation.

No one Knows, besides who Predicted These Events and the On Going Events from now.

If needed now best to use it and catch up later.