Retirement Income

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Aussies less worried about debt, but still anxious about money

<p>Money – and making enough of it – continues to be a pressure point for many Australians. In fact, one in four households struggle to get by on their current income.</p> <p>Even more people are worried about losing their income altogether. Almost half (44%) are concerned that they or their partner could be out of a job.</p> <p>The proportion of the population worried about debt is also high, at 42%. Yet this is the lowest it’s been in more than four years of our nationwide CHOICE Consumer Pulse surveys.</p> <p>Private health insurance has topped the list of cost concerns for the third time running. But the number of consumers baffled  by the various policy options – which spiked in our <a href="https://choice.us4.list-manage.com/track/click?u=270103a13e38b9f6643b82a8e&amp;id=2c3ef6d60c&amp;e=7f9260877c">previous quarterly survey</a> – has fallen.</p> <p>The previous survey ran in March, when there was a buzz around <a href="https://choice.us4.list-manage.com/track/click?u=270103a13e38b9f6643b82a8e&amp;id=a1f9233753&amp;e=7f9260877c">new tiers of health insurance</a> being launched by the Department of Health in April.</p> <p><strong>Health insurance still the biggest financial concern</strong></p> <p>The cost of private health cover is the biggest worry for most people (82%), followed closely by fuel (80%) and electricity (79%).</p> <p>In March, we recorded a high of 62% of people who said that finding a health insurance policy to suit their needs was too complicated. The June survey brought this proportion back in line with previous results, at 53%. </p> <p>The result comes as <a href="https://choice.us4.list-manage.com/track/click?u=270103a13e38b9f6643b82a8e&amp;id=eccd56a971&amp;e=7f9260877c">the latest statistics</a> from APRA show more than 28,500 people have ditched their hospital cover in the three months to 30 June. Young people aged between 20 and 24 made up the largest proportion of those turning away from hospital cover. </p> <p>Over the same period, almost 18,500 people have dropped their extras health insurance covering services such as dental and optical. </p> <p>The total number of people with health insurance cover dropped 0.3 percentage points compared to the previous quarter. </p> <p>Meanwhile, health insurance premiums have risen 2.8% in the past year.</p> <p>Our survey reveals that health insurance has kept its status as the trickiest financial choice people make. It ranks above the 12 other major product categories we researched, including superannuation and mortgages. </p> <p><strong>Most households ‘uncomfortable’ on their incomes </strong></p> <p>Concerns over which products and service providers to choose are mixed in with other financial stresses. Two-thirds of households are either just getting by or struggling to get by on their current incomes.</p> <p>WA has the highest number of people really feeling the pinch. There, 33% of households find it hard to live on their incomes – up from 30% this time last year.</p> <p>NSW and Queensland come in second. In both states, 26% of the population lives with financial stress.</p> <p>Half of people living in NSW have the added worry of losing their jobs – the highest proportion of all states and territories with this concern.</p> <p>The percentage of people in NSW finding it hard to get by on their earnings has risen from 19% this time last year. By contrast, Victoria has experienced almost an exact reversal in fortunes. A fifth of Victorian households now struggle – down from a quarter a year ago.</p> <p>Victoria also has the lowest rate of people struggling on their incomes, along with the ACT, South Australia, Tasmania and the Northern Territory.</p> <p><strong>Debt worry slowly easing </strong></p> <p>A large proportion of people – two in five – are worried about their level of debt, but our research shows this worry is easing.</p> <p>In surveys before 2017, people worried about their debt were always the majority. But from 2018 onwards, this group has shrunk to a large minority, averaging 45%.</p> <p><em>Written by Saimi Jeong. Republished with permission of </em><a rel="noopener" href="https://www.choice.com.au/money/budget/consumer-pulse/articles/debt-worry-declining-but-many-australians-still-anxious-about-money" target="_blank"><em>CHOICE</em></a><em>. </em></p>

Retirement Income

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How to save money without pinching pennies

<p><span>Saving is necessary – yet the idea of limiting your spending can feel restrictive and stifling. Here are a few tricks you can try to make saving easier and more fun.</span></p> <p><strong><span>Look for a great deal</span></strong></p> <p><span>Whether you’re buying a new item or signing up for ongoing services – phone, internet, insurance, credit cards and more – it’s a good idea to browse through comparison sites to find the best rates. This could help you save hundreds or even thousands in the long run. Looking through discount sites or online reviews can also help you make your financial decisions. </span></p> <p><strong><span>Review your subscriptions</span></strong></p> <p><span>It’s easier than ever to subscribe to streaming services, online newspapers and mobile apps, but that also means there may be some spending that you leave unaccounted. Take a look at your accounts to see any active subscriptions and cancel the ones you no longer use.</span></p> <p><span>You can also take advantage of the family deals that these subscriptions often offer – if the people in your household all use the same services, consider getting a joint account to make the monthly bill a little lighter.</span></p> <p><strong><span>Go for pre-loved items</span></strong></p> <p><span>From clothing to appliances, shopping second hand or refurbished can be a great option. You can also use the same platform to sell your old belongings.</span></p> <p><strong><span>Consider home brands</span></strong></p> <p><span>Some staples such as toothpaste, tissue rolls, and soap will almost always be needed in a household. If you don’t feel tied to any particular brand, it’s time to make the economical switch and go for supermarket home brands. They generally have similar active ingredients and/or quality as the name brand products, but come at a fraction of the price. </span></p> <p><strong><span>Get app’d</span></strong></p> <p><span>Some mobile apps can help you put some money aside by taking spare change from everyday purchases into a savings or investment account. This type of apps usually charge fees, so read the fine print before you begin.</span></p> <p><strong><span>Visualise the goal</span></strong></p> <p><span>Once you set your savings goal, create a visual representation to see how far along you are in the journey. This will make your goal seem more tangible and help motivate you to stay on the course and accomplish the task. If you’re aiming to save $10,000 by the end of the year, you can draw a thermometer or graph to track your progress. Looking towards a specific objective, like saving up for a Hawaii holiday? Print out pictures of the places you want to visit and place them in your wallet or other spots you frequent as a reminder. This also helps shift your focus from the restrictions (“I can’t buy this because I have to be mindful!”) to the opportunities (“This will help me purchase a new car sooner!”).</span></p>

Retirement Income

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Why you should rethink inheritances

<p>Inheritances can have an enormous impact on finances and lives.</p> <p>Yet in Australia we know surprisingly little about who gets them and how big they are.</p> <p>New <a href="https://grattan.edu.au/report/generation-gap/">Grattan Institute research</a> provides some answers.</p> <p><strong>Inheritances are big and growing</strong></p> <p>A sample of estates from Victoria’s probate office suggests the median estate in Victoria is worth around AU$500,000. That’s likely to be close to what it is Australia-wide.</p> <p>But many are much larger. About 20 per cent are worth more than AU$1 million, and 7 per cent are more than AU$2 million. Property is the largest component, accounting for about half of the average value.</p> <p>The main beneficiaries of “final” estates (estates without a surviving spouse) are children, who receive about three-quarters of all inheritance money.</p> <p>Other family members, such as nieces, nephews and grandchildren, receive about 20 per cent. Friends get about 4 per cent, and charities 2 per cent.</p> <p>Average inheritances are growing about 2 percentage points faster than inflation each year, which is a good deal faster than wages or gross domestic product.</p> <p>There are reasons to believe they will soon grow even faster.</p> <p>Net wealth has grown strongly among older households. Households headed by people aged over 75 now have an average of AU$1 million in assets, up from AU$400,000 for a household headed by a person of the same age in 1994.</p> <p>And most retirees <a href="https://grattan.edu.au/report/money-in-retirement/">don’t draw down</a> on their savings.</p> <p>Indeed, many are net savers through much of their retirement, meaning there’s only one place their accumulated property and superannuation wealth can go: into bequests.</p> <p><strong>Inheritances are going to the already old…</strong></p> <p>These days, inheritances generally don’t arrive when people are saving for a house or trying to raise a young family.</p> <p>More than 80% of money passed down from parents goes to people aged 50 and over.</p> <p>The most common age bracket in which people to receive an inheritance from parents is 55-59.</p> <hr /> <p><a href="https://images.theconversation.com/files/288479/original/file-20190819-123754-94gcst.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/288479/original/file-20190819-123754-94gcst.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption"></span></p> <hr /> <p>It’s the result of good news – parents are living longer.</p> <p>But as life expectancy grows still further, it will mean inheritances increasingly supplement the retirement savings of middle-aged Australians rather than help young people get into housing.</p> <p><strong>…and the already wealthy</strong></p> <p>The wealthiest 20 per cent of Australians get 38 per cent of inheritance money; the poorest 20 per cent get only 8 per cent.</p> <p>It means the growing wealth of Baby Boomers is likely to end up concentrated in the hands of a select group relatively well-off Generation Xers and Millennials rather than being widely spread.</p> <hr /> <p><a href="https://images.theconversation.com/files/288483/original/file-20190819-123754-uayz44.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/288483/original/file-20190819-123754-uayz44.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption"></span></p> <hr /> <p>It will reinforce the advantages already enjoyed by people with well-off parents, including better schooling, better connections, and a greater ability to take financial risks because of a parental safety net.</p> <p>If (as is possible) inheritances end up becoming the dominant route to wealth in Australia surpassing lifetime earnings, there will be less incentive for ordinary Australians to attempt to get ahead through individual endeavour.</p> <p>We will have entered what French economist Thomas Piketty calls a “<a href="https://www.pbs.org/newshour/nation/how-pikettys-inequality-theory-explains-mr-darcys-wealth">Jane Austen world</a>”.</p> <p><strong>We don’t tax inheritances…</strong></p> <p>Calm debate on policy setting around inheritances is <a href="https://insidestory.org.au/death-and-taxes/">hard to come by</a> in Australia.</p> <p>Inheritances and gifts have been tax-free since the 1970s.</p> <p>Australia is one of only <a href="https://stats.oecd.org/index.aspx?DataSetCode=REV">seven</a> OECD countries without any inheritance, estate, or gift taxes. Despite the economic arguments for inheritance taxes, there seems to be little appetite to bring them back.</p> <p><strong>…if anything, we subsidise them</strong></p> <p>Not taxing inheritances is one thing, but actively subsidising them is another.</p> <p>Superannuation tax breaks were intended to encourage people to save for their retirement and to take pressure off the age pension system.</p> <p>But given that many retired Australians <a href="https://grattan.edu.au/report/money-in-retirement/">do not draw down on their capital</a>, a large part of the super tax concessions simply boosts the size of bequests.</p> <p>Super death benefits tax is intended to claw back the superannuation tax breaks when the money is passed on, in order to ensure that the government doesn’t subsidise inheritances.</p> <p>But, at 15 per cent, the rate is too low to capture the value of the accumulated tax breaks. And it can easily be avoided by retirees withdrawing funds tax-free and then contributing them back as a post-tax contribution, which is tax-free when passed on.</p> <p>The special treatment of the family home in the age pension means test also acts to boost inheritances at taxpayers’ expense. Without it there would less to pass on.</p> <p><strong>It’s time to claw some of them back</strong></p> <p>There is little justification for taxpayers subsidising inheritances. Policy changes could help.</p> <p>We recommend a higher tax on super bequests paid to non-dependents to better capture the value of the super tax breaks that are passed on rather than used for retirement. The cap on post-tax super contributions should also be lowered, to limit the re-contribution strategies.</p> <p>The age pension assets test should include part of the value of the family home, perhaps the part above AU$500,000. Seniors with higher-value properties should be allowed to borrow against their home using the Pension Loans Scheme.</p> <p>This would give them the ability to stay in their home but would mean that some of the wealth that would otherwise be passed to heirs (most likely in their 50s) would instead be used to fund them, taking pressure off the pension.</p> <p><em>Written by <span>Owain Emslie, Associate, Grattan Institute and Danielle Wood, Program Director, Budget Policy and Institutional Reform, Grattan Institute</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/rethink-inheritances-these-days-they-no-longer-help-the-young-they-go-to-the-already-middle-aged-122029" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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8 foods you don’t need to refrigerate

<p>Do you know which foods don't need to be refrigerated? For many of us, the answer is a matter of what we grew up with or personal preference.</p> <p>But there are some hard and fast rules. </p> <p>Here are some foods you definitely shouldn't put in your fridge.</p> <p><strong>1. Tomatoes</strong></p> <p>Tomatoes are best left on the bench and not in your fridge because they're sensitive to ethylene – a gas that accelerates ripening. Keeping your tomatoes separate from ethylene-producing foods, such as bananas, apples, pears and oranges, will ensure they stay fresh for longer. <br /><br /><a href="https://choice.us4.list-manage.com/track/click?u=270103a13e38b9f6643b82a8e&amp;id=1fe3558b8d&amp;e=7f9260877c">Research</a> also shows that chilling tomatoes below 12°C limits their ability to generate substances that contribute to aroma and taste. In other words, they won't be as nice to eat. <br /><br />"Tomatoes lose flavour when placed in the fridge," says CHOICE's home economist Fiona Mair. "I always keep my tomatoes in my fruit bowl or on the window sill. <br /><br />"I like to buy a mixture of firm and slightly soft tomatoes so I have beautifully ripened tomatoes I can use across the week." </p> <p><strong>2. Coffee</strong></p> <p>Ground or whole-bean coffee should never be kept in the fridge, even if it's in an airtight container. Why? Because coffee works as a deodoriser and absorbs moisture, odours and flavours from the air around it, making your morning cuppa taste less like the nectar of the gods and more like a nasty flavouring of 'fridge'. Ew. <br /><br />Instead, keep your beans in an airtight container in a dark space such as your pantry, away from sunlight, heat, steam and moisture. For the best  flavour and freshness, buy your beans as fresh as possible and use them within 72 hours of roasting. <br /><br />If that's not possible, you can store your coffee beans in the freezer for up to a month, according to the US National Coffee Association. But do so in small portions because, once you've taken your beans out of the freezer, it's best not to put them back in again.</p> <p><strong>3. Uncut root vegetables </strong></p> <p>Root vegetables, such as potatoes, onions, sweet potato and garlic, thrive outside the fridge crisper. The high humidity in fridges can cause root vegetables to rot faster. It's also important that you don't store root vegetables together, as this can affect their flavour. <br /><br />"Keeping these types of food out of the refrigerator is generally to avoid moisture absorption that happens in the refrigerator, as this can cause foods to ferment and reduce the taste and quality," says Mair. "Best to find a cool dry dark spot in your kitchen." <br /><br />According to Aloysa Hourigan, accredited practising dietitian and nutritionist and media manager at <a href="https://choice.us4.list-manage.com/track/click?u=270103a13e38b9f6643b82a8e&amp;id=9db113104f&amp;e=7f9260877c">Nutrition Australia</a>, there are some exceptions to the rule, especially after the vegetables have been cut. <br /><br />"Onions are best stored out of the fridge until they're cut, then need to be covered or placed in a sealed container and kept in the fridge," she says. <br /><br />"Whole pumpkins can be stored out of the fridge for many weeks, but once cut, they need to be stored in the fridge." <br /><br /><br /><strong>4. Coconut oil</strong> <br />"Coconut oil is climate-dependant and will solidify at temperatures lower than 24°C, so it's best to keep it in a cool, dark place like the pantry," says Fiona. <br /><br />But she says as a general guide, nut and seed oils are best kept in the refrigerator, otherwise they're "more likely to oxidise and go rancid quickly." <br /><br />Whether or not you need to put a condiment in the fridge depends entirely on the type of sauce, oil or spread you have, how much preserving salt or sugar they contain, and whether it's been opened. <br /><br />"With bottled sauces, such as soy sauce, sweet chilli sauce, oyster sauce and curry pastes, it's always best to check the label to see if it says 'refrigerate after opening'," says Hourigan. <br /><br /><strong>5. Bread</strong> </p> <p>Bread doesn't belong in the fridge – it'll go stale much faster than if you just keep it in the pantry. <br /><br />Instead, keep your bread in an airtight tin, bread box or, for hard-crusted bread, a brown paper bag. Avoid plastic too, as this encourages bread to go mouldy faster. <br /><br />Fresh bread will only last a few days before it naturally goes stale, but you can extend its life span by putting it in the freezer. Doing so slows down the natural process of retrogradation and recrystallisation, and stops it going stale.</p> <p><strong>6. Honey and peanut butter</strong> </p> <p>Honey and nut spreads are all unique, so all need different types of storage. This is why it's important to always check the label for advice.</p> <p>Honey is unique - one of the few foods in the world that never spoils thanks to its one-of-a-kind chemical make-up. The reason honey doesn't go bad is because bacteria can't grow in it, so it's happy to sit at room temperature in your pantry, where it stays soft and easy to spread. When refrigerated, honey crystallises, but is still perfectly edible.</p> <p>Honey's durability is legendary. When archaeologists opened ancient Egyptian tombs, they found jars of honey from the days of the Pharaohs that were still good to eat.<br />As for peanut butter, it's fine in the pantry for three months or so after opening. But to extend its shelf life and avoid oil separation, you can also keep it in the fridge, though this will harden it and could make it a bit more difficult to spread.</p> <p><strong>7. Basil and parsley </strong></p> <p>Some herbs such as coriander and mint are best kept in the refrigerator crisper, wrapped loosely in absorbent paper and put in a sealed container. <br /><br />But basil and parsley will turn a nasty shade of yuk if you keep them in the crisper. <br /><br />"These herbs seem to do better out of the fridge," says Hourigan. "The dry air in the refrigerator causes the leaves to wilt easily." <br /><br />To store your basil and parsley, Mair says, cut the bottom of the stems, place them in a jar with a small amount of water, then leave the jar in a cool place. "You'll just need to change the water and cut the bottom of the stems every couple of days," she says. <br /><br /><strong>8. Warm leftovers</strong></p> <p>Putting hot food in the fridge can wreak havoc on its internal temperature, which may affect other food in the fridge as well. <br /><br />So, for the sake of freshness, leave your warm leftovers to fall to room temperature first.  </p> <p><em>Republished with permission of <a rel="noopener" href="https://www.choice.com.au/home-and-living/kitchen/fridges/articles/eight-foods-you-do-not-need-to-refrigerate" target="_blank">CHOICE</a>.</em></p>

Retirement Income

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How Hughesy turned $100,000 into a dollar

<p>Dave Hughes has opened up about an ill-fated financial investment that saw him lose a six-figure.</p> <p>The comedian told the Hit Network’s<span> </span>Carrie &amp; Tommy<span> </span>that he sold his share in a business venture, which cost him $100,000, for just a dollar.</p> <p>“I once invested in a bar and my share – I mean, I’m going to be unrelatable here to some people – my share cost $100,000,” Hughes said on Monday.</p> <p>Hughes explained that the nightclub, which was in an up-and-coming part of town, did not align with his lifestyle. “I was trying to leverage my profile to make the bar happen, but also I wanted to get joy out of it,” the 48-year-old said.</p> <p>“I don’t drink and I had a wife at the time … I invested $100,000 for my share and I sold that share for $1.”</p> <p>The failed foray into the hospitality industry is not Hughes’ only misadventure. In 2017, Hughes bought a five-bedroom house in Elsternwick, Melbourne for $3 million, only to find out later that the bank valued the property at “<a rel="noopener" href="https://www.oversixty.com.au/entertainment/tv/dave-hughes-big-regret-about-3-million-the-block-house/" target="_blank">much less</a>”.</p> <p>He told Triple M’s<span> </span>Hot Breakfast<span> </span>in January last year that “it took a while” before he could find a tenant for the property, which was renovated by Josh Barker and Elyse Knowles on The Block. “I had trouble renting it,” he said.</p> <p>“At one point the real estate agent rang me and said, ‘someone wants to move in but they’ve got a dog’. I felt like saying, ‘I don’t care whether they’ve got a meth lab’.”</p> <p>It was later reported that Hughes found a renter who paid<span> </span><a rel="noopener" href="https://www.oversixty.com.au/finance/money-banking/the-unbelievable-amount-of-rent-dave-hughes-is-getting-for-his-the-block-house/" target="_blank">$2,500 to $3,000 per week</a><span> </span>for the place.</p>

Retirement Income

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Newstart Opal card? Push to lower fares for those living on $40 a day

<p>Social services are pushing for the NSW Government to create a Newstart Opal card to benefit those on unemployment benefits.</p> <p>If the scheme gets the green light, those on Newstart allowance who live on $277 a week would have a cap of $2.50 per day for public transport.</p> <p>According to the NSW Council of Social Services, those living on the dole have the same living conditions as pensioners, and they argue that Opal fares should take that into account.</p> <p>“Not having enough money to move around to access employment opportunities is an insurmountable one,” said the peak body to the<span> </span><a rel="noopener" href="https://www.smh.com.au/national/nsw/newstart-opal-card-push-to-lower-fares-for-those-living-on-40-a-day-20190815-p52hb7.html" target="_blank"><em>Sydney Morning Herald</em></a>.</p> <p>“Providing deeper concessions to the costs of transport for people living below the poverty line could make a big difference.”</p> <p>The Independent Pricing and Regulatory Tribunal is reviewing Opal fares for the next four years.</p> <p>But Transport Minister Andrew Constance said that there is currently no plan in place to reduce fares for those on Newstart, as taxpayers heavily fund public transport costs.</p> <p>“Newstart, as a program, is designed to act as a transition payment for people to go from being unemployed to a new job,” he said.</p> <p>There are currently 200,000 people on Newstart with one in four aged between 55 and 64, with the Combined Pensioners and Superannuates Association saying public transport costs are at “crisis point”.</p> <p>Opal concession cards are available for those on welfare, but the cap is currently $8 a day or $25 a week.</p>

Retirement Income

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“Be extra vigilant”: One in four retirees losing $1,000 to credit card scams

<p><span>People aged 65 and over have been urged to take precautions when banking online after a survey revealed that over one in four retirees have lost more than $1,000 to credit card frauds.</span></p> <p><span>A <a href="https://www.comparethemarket.com.au/">survey of 1,500 Australian credit card holders</a> by price comparison website <em>comparethemarket.com.au</em> found that 27 per cent of those aged 65 and above have lost a significant amount to scams. </span></p> <p><span>Baby boomers or those aged between 55 and 64 were the second most affected age group, with 22 per cent reporting upwards of $1,000 lost to skimming. Only 20 per cent of consumers aged 25-34 and 11 per cent of under 25s reported to facing the same issue.</span></p> <p><span>The poll also found that almost a third (32 per cent) of the retirees have tried to avoid using their card when shopping online.</span></p> <p><span>According to the Australian Competition &amp; Consumer Commission (ACCC), Aussies have lost a reported total of $3 million to online shopping scams so far this year.</span></p> <p><span>Money expert at <em>comparethemarket.com.au</em> Rod Attrill said older Australians are especially vulnerable to these types of cons due to difficulties in keeping up with the ever changing technology.</span></p> <p><span>“Especially for scammers online, this particular demographic are also perceived as having more accumulated wealth which makes them an attractive target when grabbing card details,” said Attrill. </span></p> <p><span>“This is why it’s vital for any consumer, old and young alike, to be extra vigilant anytime they use their credit card for online purchases or even when withdrawing money at an ATM.</span></p> <p><span>“If you suspect your financial details were stolen, you should alert your bank immediately for a better chance at recovering your money.”</span></p>

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How to spot a fake review

<p>Ever relied on an online review to make a purchasing decision? How do you know it was actually genuine?</p> <p>Consumer reviews can be hugely influential, so it’s hardly surprising there’s a thriving trade in fake ones. Estimates of their prevalence vary – from <a href="https://doi.org/10.1287/mnsc.2015.2304">16 per cent of all reviews on Yelp</a>, to <a href="https://www.news.com.au/technology/online/social/tripadvisor-denies-claims-one-in-three-reviews-faked/news-story/55243de188cc7f1fb2abb52fee3bac45">33 per cent of all TripAdvisor</a> reviews, to <a href="https://www.washingtonpost.com/business/economy/how-merchants-secretly-use-facebook-to-flood-amazon-with-fake-reviews/2018/04/23/5dad1e30-4392-11e8-8569-26fda6b404c7_story.html?utm_term=.5790b36db39a">more than half in certain categories</a> on Amazon.</p> <p>So how good are you at spotting fake consumer reviews?</p> <p>I surveyed 1,400 Australians about their trust in online reviews and their confidence in telling genuine from fake. The results suggest many of us may be fooling ourselves about not being fooled by others.</p> <p><strong>In strangers we trust</strong></p> <p>Online consumer reviews were the equal-second most important source for information about products and services, after store browsing. Most of us rate consumer reviews – the views of perfect strangers – just as highly as the opinion of friends and family.</p> <p>Trust is central to the importance of reviews in our decision-making. The following chart shows the trust results broken down by age: in general, people most trust product information from government sources and experts, followed by consumer reviews.</p> <hr /> <p><iframe id="bD0vF" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/bD0vF/3/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>The chart below displays trust ratings according to website, with the most trusted sources for reviews being <a href="https://www.tripadvisor.com.au/">TripAdvisor.com.au</a>, <a href="https://support.google.com/business/answer/3474122?hl=en">Google Reviews</a> and <a href="https://www.productreview.com.au/">ProductReview.com.au</a>.</p> <p>Those aged 23-38 tended to trust sites the most, and those above 55 tended to trust sites the least.</p> <hr /> <p><iframe id="EzmJs" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/EzmJs/1/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>While 73 per cent of participants said they trusted online reviews at least a moderate amount, 65 per cent also said it was likely they had read a fake review in the past year.</p> <p>The paradox of these percentages suggests confidence in spotting fake reviews. Indeed, 48 per cent of respondents believed they were at least moderately good at spotting fake reviews. Confidence tended to correlate with age: those who were younger tended to rate themselves as better at detecting fake reviews.</p> <hr /> <p><iframe id="0vEJi" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/0vEJi/3/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>In my opinion, respondents’ confidence is a classic example of <a href="https://theconversation.com/overconfidence-is-responsible-for-a-lot-of-mistakes-heres-how-to-avoid-it-61907">overconfidence</a>. It’s a well-documented paradox of human self-perception, known as the <a href="https://psycnet.apa.org/doiLanding?doi=10.1037%2F0022-3514.77.6.1121">Dunning-Kruger effect</a>. The worse you are at something, the less likely you have the competence to know how bad you are.</p> <p>The fact is most humans are not particularly good at distinguishing between truth and lies.</p> <p>A 2006 study involving almost 25,000 participants found that <a href="https://doi.org/10.1207/s15327957pspr1003_2">lie-truth judgments averaged just 54 per cent accuracy</a> – barely better than flipping a coin. In a study looking more specifically at online reviews (but with only a small number of judges), <a href="https://myleott.com/op_spamACL2011.pdf">Cornell University researchers</a> found an accuracy rate of about 57 per cent. A similiar study based at the University of Copenhagen found an accuracy rate <a href="https://aclweb.org/anthology/P16-2057">of about 65 per cent</a>, with information about reviewers improving scores slightly.</p> <p><strong>What we look for</strong></p> <p>So what tends to sway people’s judgement about whether a review is fake or not? My research suggests the most important attribute people look out for is “extremity” – going over the top in one-sided praise or criticism.</p> <hr /> <p><iframe id="1EwjN" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/1EwjN/2/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>This sentiment is a relatively sound rule of thumb, supported by <a href="https://doi.org/10.1016/j.elerap.2013.10.002">analysis</a>. Studies suggest fake reviews also tend to:</p> <ul> <li>focus on describing product attributes and features</li> <li>have much fewer subjective and anecdotal details</li> <li>be shorter than others</li> <li>be relatively more difficult to read (probably due to fake reviewers being hired from foreign countries).</li> </ul> <p>Fake reviews might also be identified by <a href="https://doi.org/10.1080/07421222.2016.1205907">characteristics of the reviewer</a>. Their profiles tend to be new and <a href="https://doi.org/10.1016/j.jretconser.2016.06.002">unverified</a> accounts with few details and little or no history of other reviews. They will have gained very few “helpful” votes from others.</p> <hr /> <p><img src="https://images.theconversation.com/files/286574/original/file-20190801-169696-137t3rz.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /> <span class="caption"></span> <span class="attribution"><span class="source">The Conversation/Author provided content</span>, <a href="http://creativecommons.org/licenses/by-nd/4.0/" class="license">CC BY-ND</a></span></p> <hr /> <p><strong>Test yourself</strong></p> <p>With all this in mind, it’s now’s time to see how good you are at spotting fake reviews with this quiz.</p> <hr /> <p><iframe id="tc-infographic-426" class="tc-infographic" height="400px" src="https://cdn.theconversation.com/infographics/426/080bdc1c64e581487e418b774d23f09390dab379/site/index.html" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>Chances are you didn’t do as well as you thought you would. That’s because clever fraudsters work to hide all the attributes of fake reviews outlined above.</p> <p>So two final pieces of advice.</p> <p>Use some technology to help. Two websites I recommend are <a href="https://www.fakespot.com/">Fakespot.com</a> and <a href="https://reviewmeta.com/">ReviewMeta.com</a>. In my experience, both do a good job weeding out suspicious reviews (tip: be sure to delete domain suffixes such as “.au” from the URLs you check).</p> <p>Also check out multiple review sites to get second, third and fourth opinions. It is less likely a fraudster will be paying for fake reviews on every platform.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/121043/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Adrian R. Camilleri, Senior Lecturer in Marketing, University of Technology Sydney</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/how-to-spot-a-fake-review-youre-probably-worse-at-it-than-you-realise-121043" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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What should you do with unexpected money?

<p><span>Perhaps you just won a lottery, landed a big client in your business, or simply received your tax refund. Either way, a sudden influx of cash is always welcome. </span></p> <p><span>But how can you best manage the incoming cash? Here are a few things you should consider.</span></p> <p><strong><span>Put it towards your top financial goal(s)</span></strong></p> <p><span>If you are working on paying off debt, saving up for a down payment or upgrading your car, the windfall may put you on the fast track or at least provide some shortcuts.</span></p> <p><span>If you have no specific goal in mind, putting a good chunk of the money aside as a fallback or emergency fund is a good idea in case of a rainy day.</span></p> <p><strong><span>Save it up</span></strong></p> <p><span>Park your cash in a savings account with your bank or financial institution. The interest rates may help your money grow, even at a <a href="https://www.oversixty.com.au/finance/retirement-income/why-you-should-keep-your-everyday-bank-account-to-the-bare-minimum/">modest pace</a>.</span></p> <p><strong><span>Invest</span></strong></p> <p><span>Put your money to work by <a href="https://www.oversixty.com.au/finance/retirement-income/10-ways-to-find-new-investment-ideas/">investing</a>. There are a lot of options today, from <a href="https://www.oversixty.com.au/finance/retirement-income/should-you-save-or-invest/">shares and property</a> to cryptocurrencies. Don’t forget to evaluate the risks and read the fine print.</span></p> <p><strong><span>Treat yourself</span></strong></p> <p><span>Budgeting does not always have to be dull and restrictive – if you feel like indulging yourself, set aside a small part of the extra cash for hobbies, trips, beauty treatments or other fun activities you’ve always wanted to do. </span></p> <p><span>You can also use this to buy more time for yourself – for example, instead of doing chores, outsource the task and allow yourself some relaxing downtime. Alternatively, depending on the size of your windfall, you can invest in a new car or white goods that will let you <a href="https://www.lifehacker.com.au/2019/07/what-to-do-with-unexpected-money/">complete tasks faster</a>. </span></p>

Retirement Income

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Simple ways you can save with your seniors card

<p>Getting older is something to celebrate, and as a senior in Australia, there are important concessions that become available to you as you age. Sometimes, these added benefits can be worth their weight in gold.</p> <p>If you’re over the age of 60, you might not know that you’re entitled to a collection of rewards which continue to help you out as you age. By using your Seniors Card proactively, as well as taking the time to <a href="https://healthinsurancecomparison.com.au/form/step1-choosewell/">compare your existing health fund</a>, you could potentially reduce some of your financial strain.</p> <p>The Seniors Card is one of many benefits available to all eligible Australians who are no longer working full-time. Seniors cards are part of a free service issued by every state in Australia. They enable holders to receive a wide range of discounts on public and commercial activities – especially useful for those who may have retired or work fewer hours but do not yet qualify for the Age Pension.</p> <p>The team at <a href="https://healthinsurancecomparison.com.au/form/step1-choosewell/?utm_medium=sponsoredstory&amp;utm_source=oversixty&amp;utm_campaign=august">Health Insurance Comparison</a> has compiled a quick breakdown of the concessions and eligibility criteria, so you can start accessing the benefits you’ve earned as a mature Australian as quickly as possible.</p> <p><strong>Here’s how you do it</strong></p> <p><strong>Step 1:</strong> Select your current life stage below.</p> <p><strong>Step 2:</strong> Once you select your preferred coverage options, you will have the opportunity to compare quotes from multiple health funds.</p> <p style="text-align: center;"><a href="https://healthinsurancecomparison.com.au/form/step1-choosewell?utm_medium=sponsoredstory&amp;utm_source=oversixty&amp;utm_campaign=august"><img style="width: 500px; height: 284.0909090909091px;" src="/media/7829475/2.jpg" alt="" data-udi="umb://media/7ea9f8483a9842ae909f009104e1353e" /></a></p> <p><strong>What is the Seniors Card?</strong></p> <p>For older Australians, your Seniors Card is the ultimate way to get discounts. Each state and territory has its own card, with varied arrangements when using your card in other states. To put it simply, your card can give you transport concessions and access to discounts from participating businesses on a range of goods and services. This is different to the Commonwealth Seniors Health Card.</p> <p><strong>Which states are eligible for the Seniors Card?</strong></p> <p>Each state and territory has their own Seniors Card scheme. Depending on your location, you can receive a concession on things like your energy and gas bill, rates, medical aids, public transport and taxis, and recreation centres. You can use your Seniors Card from one state in another state or territory when you’re travelling around.</p> <p><strong>What can I get with my Seniors Card?</strong></p> <p>Benefits provided by your state Seniors Card include the below:</p> <p><img style="width: 126.28255722178375px; height: 500px;" src="/media/7829493/201908_altmedia_table_lowres.jpg" alt="" data-udi="umb://media/f4d3e125cad148609ee1decb5f14ac2f" /></p> <p>While the eligibility criteria in each state are similar, some points differ so make sure you check out your state-specific eligibility at <a href="https://www.australia.gov.au/content/seniors-card">//www.australia.gov.au/content/seniors-card</a>.</p> <p>It’s important to keep in mind that some shops frequently display a ‘Seniors Card Welcome’ sticker, and that it never hurts to ask any business whether your Seniors Card could get you a discount somewhere. For a comprehensive list of discounts, head to <a href="https://www.australia.gov.au/content/seniors-card">//www.australia.gov.au/content/seniors-card</a>.</p> <p><strong>What is the Commonwealth Seniors Health Card (CSHC)?</strong></p> <p>The CSHC is a concession card some seniors can use to get cheaper health care and some discounts if you’ve reached pension age. It can also provide discounts on prescription medications, low or no cost government-funded medical services and other government concessions.</p> <p><strong>Benefits set by the card could:</strong></p> <ul> <li>reduce your health care costs, including ambulance, dental and eye care</li> <li>give you cheaper medicine under the Pharmaceutical Benefits Scheme</li> <li>cover your doctor visit as bulk billed (this is fully at the discretion of your doctor)</li> <li>offer you a bigger refund for medical costs when you reach the Medicare Safety Net</li> </ul> <p><strong>Who is eligible to receive cheaper medicines and government-funded medical services using the Commonwealth Seniors Health Card?</strong></p> <p>To qualify for a Commonwealth Senior Health Card you must be 65 or over (having reached pension age), and meet the income test and residence requirements (are an Australian resident currently living in Australia). You must not qualify for a payment from the Department of Veterans’ Affairs. If you are eligible, you could receive a reduction in the cost of Pharmaceutical Benefits Scheme (PBS) prescription medicines, as well as discounts or concession for bulk billed GP visits, and cheaper out-of-hospital medical expenses.</p> <p><strong>The checklist:</strong></p> <ul> <li>You must be of Age Pension qualifying age (65 years or older)</li> <li>You must not be eligible for Age Pension payments or a Veterans’ Pension payment</li> <li>You must meet an income test</li> <li>You must provide your Tax File Number to the Australian Department of Human Services</li> <li>You must live in Australia (as either an Australian resident or a special visa holder)</li> <li>You must not work more than a set number of hours per week in paid employment</li> </ul> <p><strong>The income test is that your taxable income**, including superannuation payments from account-based pensions, must be less than:</strong></p> <ul> <li>Singles: $53,799 per year</li> <li>Couples combined (couples living together): $86,076</li> <li>Couples separated by illness, respite care, or prison: $107,598</li> <li>Plus $639.60 for each dependent child you care for.</li> </ul> <p>For a list of more comprehensive information about the Commonwealth Seniors Health Card, please visit: <a href="https://www.humanservices.gov.au/individuals/services/centrelink/commonwealth-seniors-health-card">//www.humanservices.gov.au/individuals/services/centrelink/commonwealth-seniors-health-card</a>.</p> <p><strong>Get started now</strong></p> <p><strong>Step 1:</strong> Select your state below.</p> <p><strong>Step 2:</strong> After answering a few questions, you will have the opportunity to compare quotes in your area and could be eligible for significant savings.</p> <p style="text-align: center;"><a href="https://healthinsurancecomparison.com.au/form/step1-choosewell?utm_medium=sponsoredstory&amp;utm_source=oversixty&amp;utm_campaign=august"><img style="width: 500px; height: 339.7727272727273px;" src="/media/7829474/1.jpg" alt="" data-udi="umb://media/af3990ec51924d1582af66b59670a3be" /></a></p> <p><strong>One final thing</strong></p> <p>Though the Commonwealth Seniors Health Card may give you some health concessions, it won’t directly save you money on your health insurance. However, your government rebate increases at age 65, and then again at age 70 depending on your income, which may help your situation.</p> <p>Eligibility criteria and concessions available vary depending on your state or territory, so it’s always a good idea to contact your local council or Seniors Card office for further details.</p> <p><strong>Want to save more on health?</strong></p> <p>This is where we can help. On top of the savings you could get from your Seniors Card or Commonwealth Seniors Health Card, you could also save more by comparing your existing health insurance plan with us. Aussies who compared with Health Insurance Comparison saved $362.38* off their yearly premiums last year alone. So while you’re here, <a href="https://healthinsurancecomparison.com.au/form/step1-choosewell/">why not compare your existing health cover</a>? Thousands of senior Australians have already jumped on board, and comparing with the team at <a href="https://healthinsurancecomparison.com.au/form/step1-choosewell/?utm_medium=sponsoredstory&amp;utm_source=oversixty&amp;utm_campaign=august">Health Insurance Comparison</a> could offer you significant savings.</p> <p>*Average savings based off 14,534 customers in 2018.</p> <p>**These earning amounts are valid as of May 2018. The numbers are reviewed by the Australian Department of Human Services on the 20th of September each year, in line with inflation.</p>

Retirement Income

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ALDI predicted to catch up with Coles and Woolworths in 10 years

<p><span>Woolworths and Coles have continued to maintain their spots as Australia’s most highly-rated supermarkets – but ALDI could disrupt the duopoly in 10 years, a new report has revealed.</span></p> <p><span>In its first <a href="https://www.dunnhumby.com/sites/default/files/reports/Australia_RPI_Report_2019.pdf">Australian Grocer Retailer Preference Index</a>, customer data firm Dunnhumby found that Woolworths “narrowly” edged out Coles as the preferred supermarket among Aussie shoppers. </span></p> <p><span>Woolworths and Coles were noted for their quality products, convenient locations and easy shopping experience, beating out competitors such as ALDI, IGA and 7-Eleven.</span></p> <p><span>However, ALDI might be closing the gap in a decade. The firm said the German retailer has grown three times faster than Woolworths and Coles over the last three, five, and ten-year intervals.</span></p> <p><span>Since launching its first store in 2001, ALDI has expanded to more than 500 stores nationwide.</span></p> <p><span>“The compound annual growth rate for ALDI in Australia dwarves its competitors,” the firm said. “If ALDI continues to grow at this pace, they could double their market share in ten years.”</span></p> <p><span>Apart from its low prices, Dunnhumby said the German retailer’s success could be attributed to the popularity of its private brands among shoppers. “Woolworths and Coles significantly trail ALDI on both overall prices and private brand,” it noted.</span></p> <p><span>ALDI was also found to have the strongest emotional connection with its customers, with more people stating they would be “sad if this store closed”.</span></p> <p><span>However, Dunnhumby said there is room for ALDI to improve. Compared to the average Australian grocer, ALDI scored lower in shopping experience, range of ready-to-eat food, and product freshness. “ALDI are currently winning on price so it is likely that they will focus on Convenience and Quality improvements to drive future growth.”</span></p>

Retirement Income

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"This is incompetence": Centrelink payment glitch costs Aussies thousands

<p>Families on Centrelink have been left thousands of dollars out of pocket after a nationwide glitch on the website saw people inadvertently pay their debts several times over.</p> <p>Department of Human Services said about 400 welfare recipients across the country ended up paying more than they owed after the site showed an error message during the payment process.</p> <p>People who tried to make a payment for the second or third time unknowingly had their money withdrawn from their accounts with every failed attempt.</p> <p>A Melbourne mother said she was down by more than $13,000 after trying to pay her debt multiple times in late July.</p> <p>On Thursday, she was told the refund could take another week to arrive in her account.</p> <p>“We owed $4,300 on our family tax benefit debt due to underestimation of our yearly income and tried to do the right thing by paying it immediately,” she told <a rel="noopener" href="https://www.smh.com.au/national/this-is-incompetence-families-out-of-pocket-after-centrelink-glitch-20190806-p52eis.html" target="_blank"><em>The Age</em><span> </span>and<span> </span><em>The Sydney Morning Herald</em></a>.</p> <p>The woman said she logged on to the myGov portal to pay her debt. </p> <p>“We put the credit card details in, pressed submit and it said the page has not been found – it didn’t say it had been processed or give us a receipt number. It just looked like it hadn’t worked,” she said.</p> <p>“I did it again, and it was the same thing, it said ‘page not found’ and I thought it was an internet error and got no confirmation it had been processed. So I tried more times and my husband texted me and said, ‘Why did you pay it three times?'”</p> <p>When she contacted Centrelink, the agency said “it’s a nationwide issue with IT systems with all payments that have been made” and that it can take up to two days before her overpayments show up in the system.</p> <p>On Wednesday, a Centrelink representative called her to inform that the refunds of the two extra payments could take seven days to arrive, and that they still had no record of the third.</p> <p>“The payment portal was taking money from people, in some instances people paying multiple times, because it looked like it doesn’t work the first time,” she said. “This is incompetence ... Not good enough at all.</p> <p>“That’s money we need, we only have one income and a family of four, we can’t just have that amount in the ether missing for who knows how long.”</p> <p>According to Fairfax, Centrelink identified and fixed the nationwide issue on August 1.</p> <p>Department of Human Services general manager Hank Jongen said by Thursday morning, around 100 out of about 400 affected recipients have been refunded. </p> <p>“We’re deeply sorry to customers who experienced issues making payments to us last week,” Jongen said.</p> <p>“We’re reimbursing all affected customers their repeat payments. We’ve started contacting them to let them know and provide support.</p> <p>“People who have incurred costs associated with this issue should contact the department to discuss reimbursement.”</p>

Retirement Income

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Newstart unemployment benefit: Could you live on $40 a day?

<p>Since parliament has resumed three Liberal members - Dean Smith, Russell Broadbent and Andrew Wallace - have joined a group of Nationals calling for an <a href="https://www.theguardian.com/australia-news/2019/jul/22/newstart-liberal-mps-break-ranks-to-join-nationals-group-calling-for-welfare-increase">increase</a> in the A$40 per day Newstart unemployment allowance.</p> <p>Labor has already committed itself to both an <a href="https://www.smh.com.au/politics/federal/labor-backs-newstart-increase-amid-coalition-divisions-on-payment-20190723-p529vu.html">inquiry and an increase</a>, although it won’t specify the size of the increase. The Greens have introduced a bill that would increase Newstart by <a href="https://www.theguardian.com/global/video/2019/jul/22/emotional-scenes-in-senate-over-newstart-rise-with-one-liberal-senator-breaking-ranks-video">A$75 a week</a>.</p> <p>Defending the current level of Newstart, Finance Minister Mathias Cormann told the ABC’s Sabra Lane that the payment was “transitional”.</p> <blockquote> <p>LANE: Could you live on 40 bucks a day?</p> <p>CORMANN: The Newstart allowance which is I guess, what you are now raising is a transitional payment for…</p> <p>LANE: It is, and you’ve diverted straight away. Could you live on 40 bucks a day?</p> <p>CORMANN: Newstart allowance is a transitional payment. It is a payment that is increased twice a year. It is indexed twice a year. Most Australians who are on Newstart allowance are on that payment for a very short period.</p> </blockquote> <p>Greens senator Rachel Siewert actually did try to <a href="https://www.abc.net.au/news/2012-04-30/siewert-living-on-newstart/3976916">live on Newstart</a> for a week in 2012.</p> <p>She introduced <a href="https://bit.ly/2SARw3s">the bill</a> that would lift it (and the similarly-sized youth allowance, sickness allowance, special benefit, widow allowance, crisis payment and Austudy) by A$75 a week.</p> <p>On Monday she asked the Senate to “<a href="https://bit.ly/2SupTsL">not believe what the government says</a>”</p> <blockquote> <p>This is not a transition payment anymore. The employment situation in this country has changed from when the unemployment benefits first came in, and it’s certainly changed since 1994. People have to survive on this payment long-term.“</p> </blockquote> <p>Liberal Wendy Askew <a href="https://is.gd/yfcG8h">responded</a>:</p> <blockquote> <p>These allowances are not designed as a long-term payment for people, and this is shown by the fact that around two-thirds of job seekers who are granted Newstart exit income support within 12 months.</p> </blockquote> <p>So what’s the truth? Are most Australians who go onto Newstart on it for only a short time, or are most of those who are on Newstart on it for a long time?</p> <p><strong>Short term, or long term?</strong></p> <p>As it happens, both claims are sourced from the same Department of Social Services publication, <a href="https://data.gov.au/dataset/ds-dga-4ccff587-4a46-4ab9-8833-76dadaa10ebe/details?q">DSS Payment Trends and Profile Reports</a>.</p> <p>It says <a href="https://bit.ly/2SuvVti">257,494</a> Australians went on to Newstart between June 2015 and June 2016. Most of them (191,680) hadn’t previously been receiving income support.</p> <p>In the same 12 month period, 274,113 Australians left Newstart, 212,320 of them out of the income support system altogether.</p> <p>If most of those who went on it in that year also went off it in that year then the government would be correct in saying that "two-thirds of job seekers who are granted Newstart exit income support within 12 months”.</p> <p>But it would leave most of the rest of the 732,100 Australians on Newstart on it for an increasingly long time.</p> <p>The table below shows that in June 2016, 73 per cent of Newstart recipients were classified as long-term (one year or more), up from 71 per cent the previous June.</p> <p><a href="https://images.theconversation.com/files/285258/original/file-20190723-91860-4ox4yz.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/285258/original/file-20190723-91860-4ox4yz.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption">Duration refers to duration on any income support payment and for some will be longer than their current duration on Newstart.</span> <span class="attribution"><a href="https://bit.ly/2SuvVti" class="source">Source: DSS</a></span></p> <p>Graphically, it is possible to see that in June 2016, there were both</p> <ul> <li> <p>fewer Australians on Newstart than in the previous year (more had left Newstart than taken it up), and</p> </li> <li> <p>a greater proportion of them on it for more than a year</p> </li> </ul> <hr /> <p><strong>Number of Newstart recipients by duration on income support, ‘000</strong></p> <p><a href="https://images.theconversation.com/files/285256/original/file-20190723-91870-1vb5rdl.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/285256/original/file-20190723-91870-1vb5rdl.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption"></span> <span class="attribution"><a href="https://data.gov.au/data/dataset/4ccff587-4a46-4ab9-8833-76dadaa10ebe/resource/d88d3863-b845-4905-84a2-6ed60603bd7e/download/newstart-allowance-payment-trends-and-profile-report-june-2016.pdf" class="source">Source: Department of Social Services</a></span></p> <hr /> <p>The apparent contradiction between most of the people who enter Newstart quickly leaving it and most people who are on Newstart being on it for a long time appears to reflect a confusion between flows and stocks.</p> <p>The <em><a href="https://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/stocks-and-flows">International Encyclopedia of the Social Sciences</a></em> illustrates the difference using a bathtub.</p> <blockquote> <p>The level of water in the bathtub is a stock, the water coming from the faucet is an inflow, and the draining of the water through the drain is an outflow. If we plug the drain and turn on the faucet, the net inflow will be positive, and the stock of water in the bathtub will be rising. If, instead, we close the faucet and open the drain, the net inflow of water will be negative, and the stock of water in the bathtub will fall.</p> </blockquote> <p>Between 2015 and 2016 about 260,000 people flowed in to and out of Newstart, and as it happened more flowed out than flowed in.</p> <p>But those who remained were increasingly likely to have been on Newstart for a long time, probably due to the so-called <a href="https://www.iza.org/de/publications/dp/7440/the-scarring-effects-of-unemployment-low-pay-and-skills-under-utilisation-in-australia-compared">“scarring” effect</a> that makes people less job-ready (and less attractive to employers) the longer they have been out of work.</p> <p><strong>Most current Newstart recipients are long-term</strong></p> <p>The proportion of Newstart recipients on payments for more than a year has climbed from 69 per cent in 2014 to 73 per cent in 2016, and according to the latest <a href="https://data.gov.au/dataset/ds-dga-cff2ae8a-55e4-47db-a66d-e177fe0ac6a0/details?q=Social%20services%20demographic%20data">Department of Social Services</a> figures, to 76.5 per cent in 2018.</p> <p>Senator Siewert’s observation that most Newstart recipients have to survive on it long-term is correct.</p> <p>At any one time the overwhelming majority of the people on the $40 per day have been on it for more than a year.</p> <p>What’s more, it appears that the decline in the total number of people on Newstart has not been because more of the people on Newstart have been able to get a job, but because the flow into Newstart has slowed.</p> <p>That is probably a positive development, although there is also the possibility that it is happening because of the onerous <a href="https://www.acoss.org.au/media_release/employment-services-arent-working-acoss-calls-for-major-reform/">compliance burdens of job search</a>, together with the increasing inadequacy of Newstart.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/120826/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Peter Whiteford, Professor, Crawford School of Public Policy, Australian National University</span>. Republished with permission of </em><a href="https://theconversation.com/are-most-people-on-the-newstart-unemployment-benefit-for-a-short-or-long-time-120826"><em>The Conversation</em></a><em>.</em></p>

Retirement Income

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The unexpected way you're wasting money in the kitchen

<p><span>We are always looking for ways to save money in the kitchen, be it through <a href="https://www.oversixty.com.au/finance/money-banking/the-savvy-supermarket-hack-to-get-free-groceries/">grocery</a> <a href="https://www.oversixty.com.au/finance/money-banking/savvy-shoppers-reveal-the-best-time-to-shop-at-aldi-coles-woolies/">hacks</a> or <a href="https://www.oversixty.com.au/finance/money-banking/supermarket-hack-how-to-get-5-discount-at-woolworths-and-coles-with-this-simple-trick/">discount hunts</a>.</span></p> <p><span>But what is often forgotten is that our hard-earned cash could be wasted in a different way.</span></p> <p><span>When you buy groceries for the coming week or month, it can be difficult to gauge how much you will consume exactly. Incorrect estimates can be costly – when the food in the fridge goes bad, the money you have strategically spent goes down the drain. </span></p> <p><span>According to the <a href="https://www.ozharvest.org/what-we-do/environment-facts/#_ftn11">NSW Environment Protection Authority</a>, the average Australian household discards 20 per cent of the food they buy, roughly equalling to a waste of $3,800 worth of groceries every year. </span></p> <p><span>There are a few things that you can do to keep your food waste to a minimum. Planning your meals ahead could help you organise your shopping list more easily, and using up all parts of the produce – such as beef bone or mushroom stems – can give some variety to your food while making sure you’re getting the most bang for your buck.</span></p> <p><span>Don’t be so quick to throw out items either. Any food that has gone past its best before date can still be eaten provided that it has been stored properly. Leftovers should also be eaten – if you’re feeling bored, you can repurpose and use them when cooking other dishes.</span></p>

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Duty-free shopping: The do's and don'ts for nabbing a bargain

<p><span>When you’re lounging around at the airport waiting for the boarding gate to open, it can be tempting to look around the brightly lit shops and pick up some duty-free goods. While you may find great bargains, the cost of some items at these stores can be a lot more expensive than local retailers. If you’re not paying attention, you may end up paying up to twice the recommended retail prices.</span></p> <p><span>Here are the things you should get at the duty-free to save money, as well as the shopping traps you should avoid.</span></p> <p><strong><span>What you should buy</span></strong></p> <p><span>You could save a great deal when buying liquor, cigars and tobacco products at the airport. According to a review by <a href="https://www.escape.com.au/travel-advice/duty-free-is-it-really-worth-it/news-story/6212a769799001a67abb6813d7ca95e8"><em>finder.com.au</em></a>, spirits such as Absolut vodka and Johnnie Walker Red whiskey were 33 per cent cheaper. The price gaps can be more significant if you’re travelling to a country where alcoholic drinks or cigarettes are more expensive due to high taxes – so stock up on the way to avoid spending a fortune later. </span></p> <p><span>Keep in mind the restrictions in place for alcohol purchases – in Australia the limit is 2.25 litres. </span></p> <p><span>Some cosmetics, electronic goods and luxury goods – such as perfumes, bags or sunglasses – can also be cheaper, depending on price variations. A <a href="https://www.choice.com.au/travel/on-holidays/duty-free/articles/duty-free-shopping-traps">2018 comparison by CHOICE</a> found that iPhone X Silver 256GB was cheaper at Sydney Airport’s Heinemann duty-free shop than at Apple Store, while Canon IXUS 190 Digital Camera was more affordable at Harvey Norman. Andy Kollmorgen of the consumer group advised travellers to “shop around” and “do your research”.</span></p> <p><strong><span>What you shouldn’t buy</span></strong></p> <p><span>In general, confectionery and snacks are a no-go – <em>finder.com.au</em> discovered that Tim Tams were priced 72 per cent higher than in supermarkets. It can indeed be hard to resist getting the special chocolate blocks that you can’t find in your neighbourhood Woolies, but common snacks should be purchased out of the airport.</span></p>

Retirement Income

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Why you should keep your everyday bank account to the bare minimum

<p><span>When you sign up with a bank, you are likely to receive two accounts – one for everyday transactions and one for savings. </span></p> <p><span>A transaction account usually comes with a card so that you can withdraw cash at the ATM and pay day-to-day expenses. On the other hand, a savings account does not usually have a linked card – but it offers higher interest rates compared to the transaction account, allowing you to grow your balance. </span></p> <p><span>Many people put a large sum of their money on their transaction accounts for practical purposes – who knows when you need to make a major purchase? – but experts say this move may not be so wise in the bigger picture.</span></p> <p><span>“I … realised that money sitting in a debit account just, well, sits there,” Laura Munoz of <a href="https://thefinancialdiet.com/5-life-changing-financial-habits-i-took-way-too-long-to-adopt/"><em>The Financial Diet</em></a> wrote. “It doesn’t earn interest and it’s not working for you, so there’s no real reason to keep more than a healthy buffer there in case you need to take out cash in a pinch.”</span></p> <p><span>While it is important to maintain a healthy balance to pay bills and everyday needs in your transaction account, Munoz said savings should be prioritised before spending. By working out how much you roughly spend every month, you can plan ahead and keep only the bare minimum amount in the transaction account to cover everyday expenses while transferring the rest to the savings account immediately.</span></p> <p><span>As <a href="https://www.moneysmart.gov.au/managing-your-money/banking/transaction-accounts"><em>MoneySmart</em></a> advises, “Only keep the money you need to cover your everyday costs in your transaction account. Put the rest of your money in a savings account and watch your savings grow with the extra interest.”</span></p> <p><span>This can also help you curb your shopping habits, as the limited amount will make you more aware of the dollars you fork out.</span></p> <p><span>Munoz said she is now putting most of her cash in two places –a high-yield, risk-free savings account and another savings account that is invested in the stock market. This does not have to be the case for you if you are more risk-averse – find a savings account where your earnings can comfortably grow, and make money work for you.</span></p>

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War on welfare: Seniors groups demand special "grey pay" deal on Newstart

<p>Seniors are pleading with the Morrison government to increase the dole payments for mature-aged workers as those who are over-55 have less of a chance to secure another job.</p> <p>Nationals Senator John ‘Wacka’ Williams backed a “grey pay” plan to boost the $555-a-fortnight allowance on Monday night, saying the dole should be paid on a sliding scale.</p> <p>Speaking to <a rel="noopener" href="https://thenewdaily.com.au/money/2019/07/29/newstart-seniors-pay/" target="_blank"><em>The New Daily</em></a>, Williams said those who are older and unemployed deserved to be compensated correctly as the age to receive pension has been increased to 66.</p> <p>“As you get older, it’s harder to get another job,” he said.</p> <p>“It might be that you pay over-55s $320 a week and pay younger workers less. The taxpayers of this country don’t owe you a living. But by stepping it, you’re also helping the budget.”</p> <p>But welfare groups have advised against it, saying that rent, food and utilities cost those on a low salary the same regardless of age.</p> <p>Over-55s are now the largest single age cohort on Newstart, with many mature-aged workers unemployed.</p> <p>This means that they rely on Newstart for longer.</p> <p>Ian Henschke, chief advocate for Seniors Australia, said a plan to provide a more generous payment to those in the senior bracket was already in motion.</p> <p>However, he says it’s unrealistic to expect a 65-year-old to survive on $15,000 a year on Newstart and is then paid $24,000 a year in the aged pension as soon as they turn 66.</p> <p>If on the dole for nine months, those over the age of 60 are able to receive $600 a fortnight instead of $555.</p> <p>“It’s a tacit admission it’s tougher for older workers to find another job,” said Mr Henschke.</p> <p>“We are seeing seniors spend almost four years on Newstart and we are talking about hundreds of thousands of Australians chewing up their savings before they qualify for the aged pension.”</p> <p>If you are aged between 50 to 59, you are required to complete a total of 15 hours per week of an approved activity for six months each year under Work for the Dole rules, but that initiative now includes volunteering.</p>

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The results are in! Australia's favourite supermarket has just been revealed

<p>Coles and Woolworths may have tried to keep shoppers coming back with their collectible campaigns, home deliveries and loyalty programs.</p> <p>But a new survey of 2,897 consumers has found that ALDI has maintained its spot as Australia’s favourite supermarket.</p> <p><a rel="noopener" href="https://www.canstarblue.com.au/stores-services/supermarkets/" target="_blank">Canstar Blue’s latest supermarkets review</a> saw the German retailer taking the crown as the best-rated chain in the country, beating out major competitors IGA, Coles, Woolworths and Foodland. This is the seventh time in nine years that ALDI has topped the list.</p> <p>Shoppers gave ALDI five stars for overall satisfaction as well as value for money, freshness of fruit and veggies, quality of private label products, and deals and specials. However, the budget supermarket only received three stars for customer service.</p> <p>IGA came in second for overall satisfaction, followed by Coles at number three. Woolworths and Foodland rounded up the list in the fourth and fifth rank respectively.</p> <p>Canstar’s Simon Downes said ALDI had found the right balance between <a rel="noopener" href="https://www.9news.com.au/national/favourite-supermarket-aussie-survey-shows-aldi-beating-coles-woolworths-a-current-affair/a74073ec-f114-45e3-abaa-47b0e5077587" target="_blank">quality products and competitive prices</a>.</p> <p>“This is why Coles and Woolies are trying so hard to liven up that shopping experience, giving us Coles Little Shop, or Lion King, things to collect to make it a bit more interesting,” he said.</p> <p>ALDI’s customer service and communications director Adrian Christie said the chain is focusing on keeping prices affordable instead of following the trends that its competitors have jumped into.</p> <p>“We are very focused on anything that adds cost and complexity that could jeopardise our business model and how we're able to provide our prices,” he told <a rel="noopener" href="https://www.smh.com.au/business/companies/we-like-to-stick-to-our-knitting-aldi-rules-out-collectibles-loyalty-programs-20190729-p52bu5.html" target="_blank"><em>The Age</em><span> </span>and<span> </span><em>The Sydney Morning Herald</em></a>.</p> <p>“We like to stick to our knitting.”</p> <p>While the retailer plans to stick to its successful business model for now, Christie said it is not ruling out any changes or new additions such as self-serve checkouts.</p> <p>“While we have no plans to introduce self-serve checkouts, we’ll look at things that customers appreciate and see value in. And if it enhances the operations of our store, the customer experience and then we’ll obviously look to adopt those,” he said.</p> <p>“There’s plenty of things we could do, from selling sushi and BBQ chickens right through to home delivery and self-checkout.</p> <p>“We’ll pioneer where things make sense, but until we’ve looked at the business model and we’ve calculated that it won’t add to any cost to doing business, we’re putting them to the side.”</p>

Retirement Income

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Why we perceive ourselves as richer than we really are

<p>Every day billions of people make countless decisions that have economic implications. Buying new clothes, having dinner at a Japanese restaurant, renting a house: most of our decisions determine how much money we spend or save. Some of our decisions also increase the amount of debt we have accumulated, such as when we buy a book and pay by credit card or when we obtain a loan to buy a new car.</p> <p>Do people always weigh up pros and cons, use all the available information and commit to their long-term goals when making such decisions? Research in behavioural economics suggests this is not the case.</p> <p>For example, even though many Americans argue that they should be saving more for retirement, they declare that they frequently <a href="https://scholar.harvard.edu/laibson/publications/hyperbolic-consumption-model-calibration-simulation-and-empirical-evaluation">do not commit to their saving decisions</a>.</p> <p>In general, psychologists and behavioural scientists have long found that the gaps between people’s intentions and their actual behaviour are often due to cognitive biases – <a href="https://onlinelibrary.wiley.com/doi/pdf/10.1002/9780470939376.ch25">systematic errors in thinking</a> that affect individual decisions and judgements.</p> <p>Cognitive biases explain why our economic decisions often appear to be flawed by self-control problems, myopic behaviour, changes in preferences over time and other behavioural inconsistencies.</p> <p>For instance, <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1540-6261.2009.01518.x">scholars</a> have found that people have a cognitive bias that often leads them to underestimate the true cost of debt, thus borrowing more than what they can afford.</p> <p>As another example, research in economic psychology <a href="https://www.researchgate.net/publication/23547394_Unfixed_Resources_Perceived_Costs_Consumption_and_the_Accessible_Account_Effect">has shown</a> that the perceived cost of an item is lower than the actual cost if people compare it to greater, rather than smaller, financial resources.</p> <p>For instance, even though a person knows that the objective cost of a T-shirt is 25 euros, that person is more likely to buy the T-shirt if she mentally compares the cost to the money in her bank account (for instance 23,000 euros) rather than the money in her wallet (let’s say 100 euros).</p> <p><strong>The bias on wealth perception</strong></p> <p>Following this line of research, at the Complexity Lab in Economics (CLE) of Università Cattolica del Sacro Cuore in Milan, <a href="https://www.axa-research.org/en/projects/alberto-cardaci">I have recently started a new project</a>, “Cognitive biases, perceived wealth and macroeconomic instability”, with the help of a postdoctoral scholarship by the AXA Research Fund.</p> <p>By combining findings from behavioural economics and social cognitive psychology with the techniques of experimental economics, the project essentially tests the hypothesis that some people tend to spend more than they “should” because they have the wrong perception of how wealthy they are.</p> <p>In other words, our working assumption is that, depending on <a href="https://www.investopedia.com/terms/l/leverage.asp">the value of leverage</a> (that is, the ratio between debt and net worth), people may feel wealthier even when their net worth has not changed, and that this makes them psychologically more prone to increase their spending, as well as their borrowing. We call this the “leverage bias hypothesis”.</p> <p>At CLE we have run some preliminary laboratory experiments to test the presence of the leverage bias. Our first results (to be published) confirm that around 78% of the participants have a wrong perception of the amount of wealth owned and this perception changes based on <em>how</em> wealth is composed, even when the net value remains constant.</p> <p>We postulate that this misperception of wealth may play a significant role at explaining individual consumption and borrowing decisions that do not appear rational based on canonical economics.</p> <p>Indeed, the potential implications of a cognitive bias of this type are substantial. An individual with a distorted perception of wealth may feel financially better off, consume more, borrow a larger amount of loans and overestimate her ability to pay back her debt in the future.</p> <p>This behaviour would have consequence not only for the borrower, but also for the lender: a borrower’s inability to meet the debt obligations would result in the accumulation of non-performing loans on the balance sheet of financial institutions in the credit market.</p> <p><strong>Partial explanations for massive crash</strong></p> <p>By extending this reasoning to a greater scale, it is also possible that macroeconomic fluctuations be (at least partially) explained by the excess spending and debt accumulation trigger by the leverage bias. This is the case when a large number of people perceive themselves as richer than they actually are: consumption can rise in the aggregate to the extent that such people possibly increase their debt being inaccurately confident that they will be able to pay it back.</p> <p>Before the 2007 financial crisis the level of household debt skyrocketed, going <a href="https://www.investopedia.com/updates/usa-national-debt/">beyond 100 per cent of GDP</a>. In those years, the American society easily and quickly moved from debt-led to debt burdened.</p> <p>While almost certainly not all personal debt accumulated in society could be attributed to behavioural fallacies, it is worth investigating whether distorted perceptions of wealth may have tremendous costs not only at the individual level but also at the macroeconomic one.</p> <hr /> <p><img src="https://images.theconversation.com/files/202296/original/file-20180117-53314-hzk3rx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption"></span></p> <p><em>Created in 2007, the Axa Research Fund supports more than 500 projects around the world conducted by researchers from 51 countries. To learn more about the work of Alberto Cardaci, visit his <a href="https://albertocardaci.wixsite.com/alcardaci">site</a> as well as the <a href="https://www.axa-research.org/en/projects/alberto-cardaci">Axa Research Fund dedicated page</a>.</em><!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/95965/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Alberto Cardaci, Post-doctoral fellow, Complexity Lab in Economics (CLE), Università Cattolica del Sacro Cuore - Catholic University of Milan</span>. Republished with permission of </em><a href="https://theconversation.com/why-we-perceive-ourselves-as-richer-than-we-think-we-are-95965"><em>The Conversation</em></a><em>. </em></p>

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3 ways to save money without sacrificing your social life

<p><span>It’s hard to stay social when you’re trying to curb expenses. However, there are tricks that will allow you to spend some quality time with friends and loved ones without having to feel like you’re throwing money down the drain.</span></p> <p><strong><span>1. Be honest, be positive</span></strong></p> <p><span>You don’t have to make flimsy excuses to avoid going out – be open about your intentions, but frame it positively. Instead of saying “these events are too expensive”, you can tell them, “I’m trying to be really good at saving and staying home these days”. While it may be uncomfortable to say no to invites outright, your friends may turn out to be more supportive to your goals than you expected.</span></p> <p><strong>2. Provide alternatives</strong></p> <p><span>Fill your social calendar with free or cheap activities. This could be a visit to the new art exhibition in your city, a potluck picnic at the park, a hike by the mountains, a game night at your home, and more. Don’t forget to look out for special promos and discounts on popular websites like Groupon or Scoopon for more affordable options.</span></p> <p><strong>3. Put it in the budget</strong></p> <p><span>Don’t want to skimp on your bar outings or group classes? It’s time to look at your budget. Once you determine the amount you need to save every month, set aside some of the rest for fun-related expenses. Budgeting allows you to figure out your priorities and stay within the limits. Stick to your allocated budget well – once it’s out, do not extend it any further!</span></p>

Retirement Income