I’m signed up with HESTA but have basically never examined it and don’t really know what this is all for. From what I gather and have researched, superannuation is money I am forced to save now to ensure I can have income when older (seems weird, why can’t I have the money now so I can use it to make more money or whatever?), but I don’t get this investment stuff at all.
There’s like some stock line graph looking thing that seems to go up and down depending on the year, and there’s an option to change my investments through an investment setting option or something with a bunch of options, but I have no idea how any of that works or why it’s important. I’m just on the default setting right now. Even before accessing the section where I can change stuff I am asked questions about wanting high or low volatility and I have no idea what any of it means.
I’ve been told it is important and I need to monitor this and change my investments every week or I lose money, but I don’t understand why and the person I’m trying to ask is incapable of explaining it to me without getting irrationally angry at me for not knowing the same things they did (despite the fact that they said superannuation had NOTHING to do with money, which I now know was nonsense).
Please help me as I have no general life skills and am a sad sad man.
Thank you.
In: 1
Are you Australian? I think superannuation is an Australian account similar in some ways to a 401k in the US or an RRSP in Canada, but the details are somewhat different in each country so /r/AusFinance might be able to help you more with that. In general, these types of accounts tend to let you hold investments in them that are not subject to the taxes you would pay in an ordinary investment account.
As for investing, that just means using your money in such a way as to try and make more money in the future. Most investment accounts contain stocks and/or bonds. You can think of a buying a bond as lending someone (usually a government or company) money. They pay you interest for some predetermined amount of time and then at the end they give you your money back. Buying a stock is buying a part of a company. If the company sells goods or services and makes a profit, you get a piece of the profit. Both stocks and bonds can be re-sold later on the market. Bonds are generally perceived to be less volatile, making for a safer, more conservative investment. Stocks, on the other hand, tend to be riskier but they also tend to have higher returns over the long term.
Hopefully that helped. If you have any follow up questions, feel free to ask.
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