Shane: Hello. My name is Shane Hancock, and I am the Head of Member Products, Guidance and Advice at AustralianSuper. And welcome to our podcast, The moments that count. Before we start, it's important to note that the information discussed in this podcast is general only and doesn't take into account your needs or personal objectives. You should assess your own financial situation and needs.
Today, this podcast is being recorded at our head office on the land of the Wurundjeri people of the Kulin Nation. I and AustralianSuper acknowledges the traditional custodians of country throughout Australia. We pay our respects to elders past and present, and extend that respect to all Aboriginal and Torres Strait Islander people.
Australian super has the privilege of 3 million members trusting us with their retirement savings. Each of those members has their own story, and today we're going to hear one of those stories. I have the pleasure of being joined by Michael Moore, a member of AustralianSuper. Welcome, Michael, and thanks for joining us today.
Michael: Thank you very much.
Shane: So, to kick off, Michael, tell our audience a bit about yourself.
Michael: I'm 64 years old. I have a wife and one daughter who's currently attending Melbourne Uni doing graphics designs. And I work for Second Bite, a company that picks up food that would normally end up in landfill and redistribute it to charities so that people can get a meal.
Shane: How long have you been doing that for?
Michael: Six months, I think I'm up to now, but, yeah, we had a situation where my wife was working at Kilmore International School, August the 2nd last year, and they got an email saying the school will close on August the 4th. Yeah. So, she was full time and I was part-time before that, and so we both went part-time and then eventually she just couldn't hack it anymore and wanted to retire. So I got into full-time employment.
Shane: Sounds like Second Bite is a significantly fulfilling organisation.
Michael: It's fantastic. Yeah. It's just great to be able to do something for the community and give a little bit back.
Shane: We'll come back to what you're doing now in relation to employment and the transition from full-time to part-time to full-time, but just take a step back. Talk us through your work-life journey.
Michael: I went to university. I was doing a Bachelor of Science. Had some family difficulties, so I had to leave that and get into the workforce. So, I worked at CSL and then I worked for the Department of Agriculture, did that for 10 or 11 years. And then in those days, you were allowed to cash in your super. So, when I left, I bought a house, and I was allowed to take all my super, which was ridiculous.
So, I bought a house and then got into cooking. Started doing cooking after that, but with zero superannuation. So, I then joined AustralianSuper, which was probably one of the best decisions I've ever made, and have maintained that since about 1988/1989, so yeah.
Shane: And so you went into cooking. You were working in restaurants and cafes?
Michael: I started doing an apprenticeship with a bakery in Bridge Road, Richmond with a view to buying the business. And so that happened. He taught me, did my apprenticeship with him, and then eventually took over the business from him. Opened another coffee shop in Kew and then used that to begin cooking. So, I would cook all the lasagnas and spaghettis, and they would go to the shop in Bridge Road Richmond and then all the cakes and coffee scrolls and things would come from Bridge Road Richmond to the cafe in Kew.
Shane: That's a fairly significant shift in career. So, you had the cafe and the shop and the cooking and then where did you progress from there?
Michael: From there I was in the business with in-laws and my then wife, my first wife, we got divorced and all of a sudden the in-laws, their attitude changed, the trust went from 100% to zero and I just couldn't operate like that.
There was always someone looking over my shoulder. They just didn't trust me anymore. And I said, just because I divorced your niece, it doesn't mean I'm all of a sudden going to steal money from you. So anyhow, I left that with a considerable debt. They then stung me, so I had to get a job.
So, I got a job as a storeman just to make ends meet with Ramset Fasteners in Richmond. Went through and became the store manager, became the state store manager and eventually the international distribution warehouse manager.
Shane: Excellent.
Michael: In Dandenong, yeah, when they bought a significant asset in the USA and became a multinational Pan Pacific supplier.
Shane: And did you stay with them until…
Michael: No, I got poached by actually one of our suppliers. They said, look, come and work for us. So, I went over and ran their warehouse in Preston, all the logistics and filling orders and everything. So, did that for a few years. And then my wife, my then girlfriend rang me one day and said, I'm pregnant. And I was 45 and she was 44.
And so we both went, "What the hell!" She had three children from a previous marriage, so she said, no, I don't want to do this anymore. So, I became the stay-at-home dad.
Shane: Yeah, okay.
Michael: Did that for six years.
Shane: Good on you.
Michael: And then eventually got back into cooking. Went back and worked for the Australian Ballet. So, we also serviced the Arts Victoria, the National Gallery, and I did all the cooking and also for the Australian Ballet School.
Shane: What a diverse career.
Michael: Yeah.
Shane: And fantastic around the six years you spent home.
Michael: Oh, that was brilliant, that was brilliant.
Shane: Whilst it's common now, it probably wasn't as common back when you did it.
Michael: I remember going to a concert for the Fairies in South Morang, and it was a two-and-a-half thousand stadium and I was the only male there.
Shane: Yeah, wow.
Michael: There were 2,499 kids and women, and there was me. I was the only one. Now, as you say, you see dads picking up kids all the time. But then there was me and maybe one other at our school. No one was doing that.
Shane: And you'll be the one that was better for it, spending that magnificent time with your daughter.
Michael: My daughter, still, when she comes to talk to us together, she talks to me. And my wife says, "Why don't you talk to me?" I'm the caregiver. I'm the one she's been talking to all her life. It's the same as dad saying, "Why don't you talk to me?" when kids talk to their mum.
Shane: Yeah. So, going back a bit, obviously in a changing work environment you've had, you talked earlier about accessing your super to buy a house, working for someone else and then working for yourself, and then, in effect, being a stay-at-home dad where you wouldn't have been earning super and then back in the workforce, which is quite common, where people are having a sporadic relationship with their superannuation.
You did also mention that, in effect, you sort of regret the fact that you could access your super to buy a house, but at the time, it would have been the most important thing for you and your family to purchase that house.
Michael: Yeah, well, it got us in. But, I mean, after we sold that house, we bought another house, and that's when interest rates went up to 18.5%. And that's why I left that position in the negative, because the house, it doesn't happen often, but it's happened once in my life where the value of the house went down and all of a sudden you've got a mortgage that's worth more than the house.
It just killed a lot of people in terms of financial stability. But luckily, I was with the help of my parents and being able to get a job and work hard and go back up to the top again, it's worked out all right. But, yes, when I was at home, I think even the insurance stopped. They wouldn't let me do insurance anymore because I wasn't working.
Shane: Yeah.
Michael: Then after that, I got prostate cancer. Well, I was told I had it. And there were two options where they slice you open or they use the robot. But to use the robot was $15,000 to $20,000 with no rebate. And so, once again, I had to access my super to get the money to do that. So, once again, the super went down. Meanwhile, my wife's working in a very lucrative position, and her super is going up and up and up and up and up. So, as a couple, we were all right.
Shane: I'm sorry to hear about the cancer. And unfortunately, you had to access your super, but also, it was something that additionally helped you to do what you needed. And you referenced your wife was working, earning that super.
But quite often, particularly in relationships, or not quite often, in almost every situation, that combined retirement savings is hugely important, and particularly in a family upbringing environment. And so you've had that benefit, as you said.
Michael: Yeah. And also the divorce. There's always that idea of what happens if things break up when we get divorced. You know, I've got no super and she's got a reasonable amount of super. I understand from women's perspectives who's been stay-at-home home carers, all of a sudden they get divorced, what happens?
Shane: It's a big issue. Absolutely. So, you've been through quite a large journey of life, and you now reference that I think you said you went back, you reduced from full-time down to part-time.
Michael: So when the school closed down and we were both part-time, luckily we came across a fantastic financial adviser who was independent, and he introduced us to working towards a retirement.
Shane: So, Transition to Retirement?
Michael: Transition to Retirement account, so we worked out what we wanted our retirement income to be, and then we used our Transition to Retirement to make our monthly income the same as that.
Shane: Right.
Michael: So that we could have four or five years of living at that amount.
Shane: How old were you when you started the Transition to Retirement?
Michael: It's probably about three years now I think, I think I was 61.
Shane: So you could access your super. And so you then, Transition to Retirement is that you're able to draw some of that money as an income out of your superannuation account, which would then compensate for a reduced working two part-time jobs. So you in effect said, "I want to earn X thousand a month." Some will come from your Transition Retirement account with AustralianSuper and the other part–
Michael: From two part time jobs.
Shane: At the same time, you're also contributing to your superannuation because of the income. So, you're in effect topping that up. So, for those listening, that's sort of the concept of a Transition to Retirement account. So, that tipping point in relation to particularly the transition retirement strategy was seeking advice? How did you come about that advice? Was it word of mouth?
Michael: Yes, word of mouth, yeah. A person at her school used this guy. He just lived not far from us. And as I said, he was independent. So, we met with him and he showed us straight away a few... Because we thought we were savvy, but…
Shane: There's a lot to know.
Michael: There's so much to know. Once he told us this and this and this, we were just like, "Oh, holy moly..." And just at that first meeting, he showed us that he could save us $15,000 just that year.
Shane: Okay, through the transition retirement approach?
Michael: And moving my wife's to AustralianSuper and all those, we had some money put away and what to do with that and what to do with this and other things and just moving it all around and making it earn the best possible return. And from an independent, he said, "Look, AustralianSuper is the best, you really need to get into AustralianSuper."
Shane: So you met with that adviser about four years ago?
Michael: Yeah, about three or four years ago.
Shane: Have you met with him since?
Michael: Oh, yes. He's now our… We've got a contract with him. We pay him every year.
Shane: And you've had to change things or it's just reassurance that you're on the right track?
Michael: Like last year, it was time to upgrade our cars. The services were starting to cost $1,700 to $2,000, you know? They were so many years old, so we said to him, what's the best thing to do? And he come back to us and he said, look, what you need to do is we had some money put aside for the purchase of the cars. And he said, put that into super. He also advised us never to close our home loan.
Our home loan got down to $2,000, and he said, don't ever pay that $2,000 off. Just pay $50 a week, what you need to pay to keep it open. And so we used the money to put into super. We used the loan to buy the cars. And my wife got all her tax back, every single bit of tax she paid for that year, which offset the price of half the cars, more than offset the interest that we'll be paying on the loan. And it increased our superannuation by $50,000. A normal person would not think of that. You know what I mean? I don't know if people do think of things like that.
Shane: So, I think that point or what I'm hearing is the benefits of the advice that you're receiving, both, there's a financial outcome, clearly, you're talking through, but there's also, I guess, a comfort and confidence outcome that you seem to trust this person, but also your ability to relax and focus on other things, knowing that this strategy is in place.
But I think quite often advice costs money. But I can see from your interaction that you see the value in what you're paying versus the outcome that you're receiving, which is really important. So, what I'm hearing in your sporadic working life or different working life and health and other things, you seem to have a fairly good understanding on where your super is at and otherwise, so you've kept in contact?
Michael: Yeah, when we first had a meeting with him and he said, how much super have you got? I was able to tell him to the dollar, how much has your wife got, this amount. And other questions, you know, and I was able to rattle them all off. And he said, that's very unusual. He said, most people go, "I don't know" when they're asked about super. And that, as you said, people have a lot going on in their life.
Maybe not all of them have the ability to do those sort of things and keep an eye on it. But having a computer where you just put in your password and then look and see what your money is and how it's been going for the last six months.
Shane: How often do you check your super now?
Michael: Probably every month.
Shane: Okay. Yeah, that work you're doing now, that's a paid role?
Michael: Yes.
Shane: So, you're getting super paid into your account now, so you're checking the contributions going in and then the payment. But you're also getting this constant reminder of your super because you got this Transition to Retirement. So, you're getting your payment into your bank account.
Michael: Plus the last few years when I was working part-time, I had to make sure that I put a $1,000, and I think it's now $1,500 in by myself each year because then you get a government contribution, which was a $1,000, but is now $500 and also putting in, my wife made contributions because her money was so much.
Shane: So is this through the adviser, was giving you this piece of advice?
Michael: Yes, yes, I knew about putting the $1,000 in yourself.
Shane: It doesn't surprise me, you're all over it.
Michael: So, yeah, if you take a $1,000 and you get $2,000, and it's now $1,500 and $500, I think. But who's going to say no to a $1,000 a year or $500 a year just by understanding what your super is doing for you?
Shane: So you're both working part-time now, is that right?
Michael: No, she's retired completely, she had a time where the people at the school, she was working part-time and she was such a good teacher that they were just hounding her to work full time and they kept giving her classes and it was just overbearing. Not worth it.
So we again sat down with our financial adviser and worked out if I went full time and what my wage was and what our choice income account that we then opened up, what we could take out of that, that she was able to retire full time.
Shane: Great.
Michael: And she's taking over the cooking.
Shane: Yeah. Okay. I was going to ask what she's spending her time doing.
Michael: No, she's doing all the cooking and looking after the house and all the things that stay-at-home person does that I was doing before. I think a lot of my friends when I was doing it, the biggest thing that they found amazing was, "You mean you wash the clothes and mop the floors?" And yeah, that's what I do. That's what you have to do.
Shane: It's called living.
Michael: Yeah. And that was the thing that they didn't think of taking the kids to school or making the sandwiches and that, but it was the cleaning the toilets and mopping the floors and I can't make my wife work full-time and then come home and have to mop the floors and vacuum the lounge. It just doesn't work like that. Well, not in my opinion.
Shane: Yeah, absolutely. So, what's your thoughts around when does full-time retirement come for you?
Michael: Well, we had it worked out with all our figures and that to age 67. My wife's only seven or eight months younger than me. So, we had it out, worked out for 2028, when we both hit the required age. But now that I've got this job, I'd like to keep doing it. There's another guy in the same organisation who works with me who's 73, and he's still working. So, it now becomes, how long can I do it? Because it's a fairly physical job, some days I have to pick up, literally pick up a ton of food and put it into the back of the van.
Shane: That's quite physical.
Michael: It's very physical.
Shane: And so your desire to work possibly longer, what's the driver of that? Because you said, "Now I've got this job", is it actually specific to this job?
Michael: Yeah, fulfilment. I mean, if I could still be cooking, look, the best thing in life for me is, as my wife says, Saturday afternoon, Sunday afternoon, close all the doors around the kitchen, have the radio at full blast, and just cook.
That's my happy time, but the fulfilment from this job, particularly when you deliver, when you get there and 20 people walk out of this health centre or community centre or wherever you're delivering to, and then you see the people lining up outside and the joy on their faces when they come in and they know that that night they're going to have broccoli soup or cauliflower and even some of the things like leg of lamb, being able to have a leg of lamb and roast potatoes.
Shane: All the things many of us take for granted.
Michael: And the other thing is, we also do the Master Chef, when you watch, I don't know if you watch Master Chef, but if you've ever seen when they open the doors and all that food that they get to choose from?
Shane: Yes.
Michael: Well, we pick that up. That's what we pick. So you get prime ribs, duck and foie gras. So, imagine you've got a family of five kids and you turn up and all of a sudden you get to choose duck and foie gras and oysters. And it's just unbelievable.
Shane: I can see and hear the joy that you get from it. And it's really common that we hear people the reason they want to continue to work longer is actually the fulfilment side. And you've got that balance where it seems that you and your wife have made some really strong strategic decisions based on advice, which has allowed you to get that comfort on the financial side. And now the personal fulfilment that you're getting is fantastic.
Michael: None of this would have happened without the financial advice that we got four years ago to set up our lives, a transition to retirement. But look, in that three years, our retirement has changed. So, I'm very aware that you can never say, "What are you going to be doing in five years..." If I could go back in my life five years, there's no way knowing that I could say what I'm doing. You know what I mean? Not a hope in hell would I be able to say that my wife would be retired and I'd be working full-time five years ago. Not possible.
Shane: And obviously, having a plan helps. But also having that constant, particularly from a financial viewpoint, you talk about the constant engagement you have with your advisor if those plans change. So, beyond the significant enjoyment you get from your work, are you planning on travelling or are there other things that you and your wife want to do together?
Michael: Well, it's quite funny. My cousin moved to Italy in the 1960s, and she's got an Italian family now, grandchildren, great-grandchildren, and we always said all our lives that we were going to go and see her, and it had just come to that stage where we hadn't gone and seen her. So, again, the financial adviser showed us how we could get enough money put aside to do it. So, we went to Italy and saw, you know, and cousins come from all over the world from Houston, from Hawaii, from Germany, for this celebration.
Shane: That's a family reunion for sure.
Michael: It was a family reunion in Italy, and it was just brilliant. But what it did make us know is you can only look at so many churches, you can only stand in so many plazas.
Shane: Good food, though.
Michael: No…
Shane: No? You weren't happy with it? Or you were, you're probably a harsher judge than I am.
Michael: No, it was terrible. It was awful. It was absolutely appalling. Like, some of the meals were just appalling.
Shane: Right.
Michael: So, I don't know if we didn't choose the right restaurants, but anyhow, what we realised was that going to a beach in Queensland or a mountain in Tasmania or in Australia was far better for us than traipsing all the way to Europe and then walking around through various churches and steeples.
Shane: So, travel within Australia is still something on the agenda.
Michael: Relaxation. So, what we've decided now is that our holidays will be at the beach, at Darwin, you know, watching the sunrise. Not going to Germany, not going to London. So, it's really helped us to know that what we enjoy is relaxation.
Shane: And the thing about retirement is it's your retirement.
Michael: Exactly.
Shane: And so you do what pleases you both. And that's the flexibility that you've created. So, last question from me, and I think maybe I know the answer to this, but I'll ask it anyway. Any sort of tips that you could give our listeners around the thing that you think was the most important thing you did to set yourself up for retirement?
Michael: Speak to a financial adviser I would say.
Shane: Advice was the most important thing?
Michael: Advice was the most important thing, yeah.
Shane: And the thing that you referred to earlier is the trust and rapport that you're able to build. And there's thousands of high-quality financial advisers in Australia.
Michael: Know what your super money is doing, I think is the second thing. Know how much you've got. Know how much you need. We were bombarded with these things, "You need a million dollars to retire."
Shane: Yeah, we actually did that as a topic on one of our previous podcasts around “Do I really need a million dollars?” Because you're right, it's sort of bandied around. And the ultimate answer to that is the way you've answered previously is it's up to the individual. What is the income that you want to live off? What are your ways of earning it? There is no one retirement.
Michael: And that's the good thing about the Transition to Retirement, is saying, is this money enough to pay your rates, to pay, like, electricity and gas has gone through the roof and we've had to make some changes to our budget, our weekly, monthly budget to accommodate that. So, it's actually physically made changes in our life, as the cost of living has changed just in the last year.
Shane: And that's clearly a common challenge for all Australians, and particularly for retirees where their income opportunities are reduced, so absolutely. Michael, I've really, really enjoyed the conversation today.
Michael: Thank you.
Shane: You've been through different, varying parts of life roles, stay-at-home dad. But it's so pleasing to see you and your wife in a position that, as I said, you've tailored your retirement to you and I think a lot of our listeners will learn a lot from you. So, thank you and all the best for the next part of your journey.
Michael: Thank you very much. It's been most enjoyable.
Shane: Thank you for joining us today. If you're an AustralianSuper member and you would like to join us to share your story or have a question or topic you would like us to cover, then click the link in our show notes to get in touch. If you've enjoyed this podcast, subscribe and share with your friends and family. See you next time.
