How much super do I need when I retire?

The general rule of thumb is that you’ll need 67% of your current net income each year. Use the ASFA Retirement Standard to find out what’s required for a modest or a comfortable lifestyle. This standard is updated quarterly.

How much does my employer contribute into my super fund?

By law, your employer must contribute 9.5% of your wage into your superannuation fund. This is in addition to your wage. You can check how much your employer has paid by looking on the annual statement from your super fund. It may also be shown on your payslip.

Do I get charged any fees on my superannuation?

Yes. Each super fund charges differently. It’s vital that you understand what fees you are paying on your super fund, as this will ultimately impact your savings. And if you have more than one super account, you are paying multiple sets of fees. It’s generally advisable to consolidate your super into one account to avoid paying more fees than you need to.

What tax benefits are there if I make personal payments into my superannuation?

If you are a low to middle income earner, you can take advantage of the super co-contribution payment from the Government. This means that if you make personal super contributions, the Government will match (or more than match) it up, to a certain limit. Better yet, you don’t even have to apply for it. As long as you make the contributions, and lodge an income tax return, you will receive the benefit automatically.

Why should I make extra contributions into my super?

Your superannuation provides income to support you when you retire. And while you may be eligible to receive the Age Pension, on its own, it’s unlikely to be sufficient to maintain a moderate lifestyle, based on the ASFA Retirement Standard. It’s also impossible to know how many years you’ll live for or what your health circumstances may be in later years. It’s therefore really important to make additional contributions in to your super as early as possible, so you can grow your super as much as you can. By doing so, you, you will create a financial buffer that can help you enjoy your retirement without money worries.

What is ‘salary sacrifice’?

Salary sacrifice is when money is deducted from your ‘before tax income’ and paid in to your super. If you’re interested in doing this, you will need to discuss it with your employer. An advantage of salary sacrifice is that you lower your taxable income, and this means you pay less tax.

What happens if I change jobs?

You can decide what to do with your super account. You can choose to stay with your current fund, switch to your new employer’s fund or even switch to a completely new fund. It’s important to remember that you should consider combining your super into just one account, to avoid paying multiple fees.

What if I want to change my super fund?

Changing your super fund is possible, but since your super is likely to be a substantial asset in your life, consider the differences between funds carefully before making the change.  Even small differences can compound over the years and make a big impact on your final balance.

When can I withdraw my super?

You can withdraw your super when you’ve reached your ‘preservation age’. Preservation age ranges from 55 to 60 years old, depending on what year you were born. Visit the Australian Taxation Office website to find out more. It’s also possible to withdraw your super before reaching your preservation age under limited circumstances, such as if you suffer from certain medical conditions or financial hardship.

What is a ‘Self Managed Super Fund’ (SMSF)?

A SMSF is a type of superannuation fund that gives you greater control over your super. It’s important to note that it can be a complicated and time consuming process that requires you to set up a trust fund, comply with various administrative and reporting requirements and stay up to date with any changes in law. Ideally, to be worthwhile, you should have a retirement account of at least $150,000 to set up a SMSF. If you are interested, we can refer you to one of our strategic partners who specialises in setting up SMSFs.

What is ‘lost super’ and ‘unclaimed super’?

Most people will change jobs or address at some stage (and sometimes their names too). If you haven’t alerted your super fund, they may have lost contact with you, making any super they hold for you categorised as ‘lost’ or ‘unclaimed’. To search for lost and/or unclaimed super, you can use the ATO’s online SuperSeeker tool.

If your superannuation question isn’t answered here, please contact us. We’ll be very happy to help.