Glimmer of hope for elderly who lost millions

SIT tight. Things will get better.

That's the message to tens of thousands of retired and semi-retired Gold Coasters who have collectively lost millions of dollars - or up to a third of their superannuation funds - in two share market crashes this week, sparked by the coronavirus pandemic.

The city's elderly population is the largest in Queensland and according to the Australian Bureau of Statistics, there are more than 91,400 people aged 65 years and over living here.

Finance gurus said local retirees and semi-retirees had lost an average 10 per cent of their super funds this week. Others with investments in high-growth shares had lost a staggering 30 per cent.

"To quell the panic, we're advising our members to take a long-term view," Rob Grover, president of Gold Coast Retirees, said.

"Naturally, people are concerned but the share market will bounce back when the coronavirus is brought under control.

"We have a few members who had $10 million each in their super funds before the crash. They are definitely feeling some discomfort after this week's events.

"We have other members who had $500,000 in super and they lost about $40,000 each."

 

Mr Grover estimated the average super value on the Coast was $300,000 but he has some members with only $80,000 in their funds.

A pensioner, who did not want to be named, said he was devastated after his super fund had taken a massive $150,000 hit this week, while his wife's super had dropped by $70,000.

Other investment experts also called for calm.

Other investment experts also called for calm.

Mike Glajnaric, of the Gold Coast branch of the Australian Shareholders Association, said pensioners should sit tight.

"The share market will recover to previous values but it could take three to 12 months - depending on how the world controls the virus."

He said the share market was a forward-thinking animal and was 'worried' the virus could not be contained.

"As soon as you can see the virus will settle, the market will pick up immediately," he said.

His association monitors the top 200 companies in Australia and Mr Glajnaric said a number of them were still paying good dividends with franking credits, which was a fantastic deal for pensioners.

Meanwhile, finance expert Noel Whittaker said retirees on the Gold Coast were panicking.

"I've had emails galore from people worried about their finances," he said.

 

Financial guru and author Noel Whittaker.
Financial guru and author Noel Whittaker.

"One of them, a 76-year-old, said he was drawing a pension from his super, but the balance had dropped by $5000 in two weeks. He doesn't know what to do.

"I can understand the feeling, but for people with the usual mix of assets in superannuation, the falls in value in the last six weeks have probably just taken back all the gains they enjoyed last year."

Mr Whittaker said it was difficult for people over the age of 65 to put their money back into super after they had withdrawn it.

"For most people - provided they have enough money in cash to pay for the next three years' planned expenditure - the best option is probably to just stay put and accept the volatility," he said.

"History tells us the biggest rises come after the biggest falls - by cashing out now, you turn a paper loss into a real one and take the risk of missing out on the rebound when it inevitably happens."


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