Four facts about wealth in Australia you need to know 11



View Profile

If you’ve ever wanted your suspicions on the wealth of the nation confirmed, the latest report from the Evatt Foundation might just provide the information you are looking for.

It shouldn’t come as too much of a shock that your children and the youth of today are finding it increasingly difficult to secure their wealth, but the Government’s changes to the age pension will also make it difficult for you to maintain yours.

Read more: Your retirement wealth is being ‘slashed’ by pension changes

What else then do you need to know?

Well, the rich are getting richer and the poor are getting poorer meaning that wealth in Australia is becoming quite unequal.

According to the report, Australia’s wealthiest 10 per cent of households have at least half of the nation’s entire wealth. The top 1 per cent? They’ve got at least 15 per cent of the wealth. At the other end of the scale is the poorest 40 per cent who have mostly negative wealth.

Wealth is defined as the “ownership of economic resources”, which includes financial assets such as bank deposits, shares and superannuation, but also includes things like land and intellectual property.

It seems that part of the reason for this increasing inequality is that the older generations have most of the money.

ME Bank supports this discovery with a survey done in early August highlighting the plight of Generations X (born between 1980 and 1996) and Y (born between 1965 and 1979). It finds that the two have it much tougher when it comes to achieving the ‘key life milestones’ such as starting your own business, buying your first home and raising a family, when compared to your generation (born between 1946 and 1964) and older.

Read more: The ‘money milestones’ you should strive for in your 60s

In fact the only milestone where all parties were on an even keel was obtaining a university degree or other qualification.

University appears to be a solid step forward on the path to wealth with male university graduates said to earn up to $900,000 more than a male high school graduate, while women will have at least $700,000 more than a female high school graduate.

However, the over-60s will take a hit come January 2017 when the Government’s changes to the age pension take effect. The asset threshold for couples applying for the pension will increase from $286,500 to $375,000 for homeowners, but for every $1,000 in assets (including your superannuation nest egg) over that threshold you’ll be penalised $3 a fortnight in pension payments, double what it currently costs you.

What do you think of wealth distribution in Australia? How will you be affected come January 2017?

Starts at 60 Writers

The Starts at 60 writers team seek out interesting topics and write them especially for you.

  1. Figures………………. The rich get rich & the poor get poorer. We work our bums off all our lives to get kicked in the guts towards the end.

  2. I turn 64 this year. I know I have done without holidays most of my working life, have worked from home and looked after my children without support from family or child minding or day care. I know I have done without going out for breakfast every week and a dinner out every week. I know alcohol was a luxury to have on special occasions and not on a daily basis. I know I did not have designer clothes and shopped mainly at Target and other lower bracket chain stores. I know I sewed a lot of my kids clothes. I never had a cleaner, disposable nappies or a gardener or lawn mowing man and still don’t. I know I went without a lot but was happy and proud of the fact I did it on my own. I know I am now tired and have poor health and I don’t want my super being interfered with by any government as I have well and truly earned the right to have a break and an easy retirement. Governments in Australia seem to go for the easy out when they stuff up instead of taking responsibility and making cuts where they can afford to like pollies pensions and politicians pay rises. Give us pensioners a break, we have worked hard to still be here.

  3. What can one say? We have an anti-Australian government who in three years have very efficiently altered for the worse, or removed everything that made life good in Australia (for the majority of us.) We still pay the same taxes, perhaps more, but we are getting far, far less returned to us. Why? Because we’re propping up the wealthy, the multinationals, the miners who’re destroying our environment (Glencore pays no tax in Australia, gets massive government subsidies, poisons an entire eco system (the McArhur river) destroys a major food source for traditional owners and looks like leaving a $1 billion rehabilitation job behind when it leaves. Leaving this huge mess for the community to clean up is another massive form of subsidy. Glencore is an environmental vandal in a class of its own!!)

    Yet nearly half of Australians blindly voted for more of it. Under Labor, we achieved a Triple AAA credit rating during the global financial crisis, under the LNP, we are in danger of losing it, have doubled and trebled the deficit and debt, sold off taxpayer owned services that serve the people, and much of our prime agriculture, ports, real estate. Yet people still believe the LNP mantra that THEY are the good financial managers. Well, tell that to the unemployed, the sick, the disabled, students and pensioners and ask them are they better off under this government.

    3 REPLY
    • We had saved all our lives and retired at age 66. We had put all our money into the family home that was quite big. Age age 68 after unsuccessfully trying to get a job, we sold the large home and bought a small one clearing $350 K which we invested. A crooked company director caused the company to be liquidated and by the time the liquidator (at $400/hr) and the bank got theirs there was nothing left of $150m of investment money. Now all we have is the age pension. The crooked director got 13 years jail but we got none of our investment money. But we thank God for the age pension.

      1 REPLY
      • I’m sorry to hear that Tim. I’ve heard some awful stories, similar. 13 years jail is better than nothing, as many of these crooks seem to get away with it, over and over. Doesn’t make up for the loss of your hard earned savings though.

    • I think you will find that the Labour Party inherited quite a large bank account when they took over from the Liberals. It was enough to get them through the financial crisis with a AAA credit rating. Sadly though, with their mismanagement, when the Coalition took over they were left with no money in the bucket, instead a large debt. Any efforts to bring adjustments to the finances were opposed by the Labour party, making it hard to rein in the debt.
      I have children and do not wish them to inherit a debt that even their children will have trouble in paying.
      Politicians should put the good of the nation first when sensible policies are placed before them instead of party line and jockeying for position.

      1 REPLY
      • Margaret, I couldn’t agree more. The current government are economic vandals with absolutely no idea of what they are doing. If it weren’t for the good management by Labor during the GFC we would be up Sh….t creek without a paddle. This government has absolutely refused to fix Super ( still waiting for their policy), or deal with negative gearing. They refuse to admit they have a revenue problem, thanks to Howard selling off any asset that wasn’t nailed down just so he could say he had a surplus. The surplus wasn’t due to good economic management, quite the reverse actually. Howard wasted all the mining boom money on tax cuts and other handouts to the upper rich 1%. Been in office 3 years now and tripled the deficit and doubled the debt. They have no policies that will get our economy going so your kids probably won’t find a job because there aren’t any. Bet you voted for the most corrupt government Australia has ever seen and believed the propaganda about jobs an growth. The only problem is they failed to mention HOW they were going to supply jobs and growth and yet gullible Australians voted for them. It beggars belief. Malcolm’s only plan is to give corporate tax cuts to businesses. Do you really believe said businesses will employ more people? Of course not. Any profits will go straight to themselves and off shore share holders. Good luck with your children/grandchildren finding jobs and being able to buy a home if they want to. The Chinese now own a good part of Australia thanks to our governments. The Chinese will be well fed in the future and we’ll be paying top dollar for food grown in our own country. These politicians disgust me.

  4. There are always disparities between people in wealth. Some are risk takers, innovators, some work hard to gain marketable skills while others aren’t.
    Many of the risk takers fail and finish up owing a lot of money but because of their attitude and work ethic they rise up again. They are the people who pay the greatest tax burden (mostly) and keep others in jobs and pensions.
    If you want wealth you have to work for it.
    Only those who rely on a pension will be effected by the changes, the rest of us who have made an effort to be self- funded will not.

    2 REPLY
    • Maybe so but the ANZ when asked to invest my nest egg of $40000 promptly put it in the second mortgage fiasco in US of A even though I was a risk adverse person and it was all I had after years of hard work. Not all of us are slackers. Just trust the wrong people.

    • Congratulations Robinoz. You must feel very superior from your self funded soap box. Just love the way some people are soooo judgemental. Try speaking just for yourself and not others that you know nothing about.

Leave a Reply

Your email address will not be published. Required fields are marked *