Avoid unnecessary fees
You may consider consolidating multiple funds into one in order to possibly reduce unnecessary fees. This can also help you get a clearer picture of how your super is invested and performing.
Consider adding to super
“Super is generally taxed concessionally, making it a great investment,” says Noble. But because there are a number of ways to top up, she recommends knowing the options available to you and seeking advice to ensure these and any other financial obligations you have are best balanced to you and your household.
Salary sacrifice is adding your own before-tax money to super via your employer. Together with your employer’s contributions, they’re known as concessional contributions; the sum of these can currently be up to $30,000 per annum if you’re under 49 years (up to $35,000 for those over 49) to take advantage of super’s concessional tax rate of 15%.
Personal contributions are those you add with your after-tax money for which you don’t claim a tax deduction. Provided this is only up to $180,000 per annum (or $540,000 over three years if under age 65), these contributions are tax-free.
“These may be two areas that become even more attractive if proposed changes go ahead,” adds Noble. “There are a few other options also.”
Spouse contributions are where one spouse contributes after-tax money into the super of a nonworking or low-income earning spouse, and receives a tax rebate.
Splitting contributions refers to concessional contributions that can be re-directed to a spouse’s account in subsequent financial years.
“Regardless of how far you are through your working life, it’s never too early or late to put your retirement savings on a better course. Help and advice is all around.”
Source: Colonial First State Investments Limited
i Gender Pay Gap Statisticsi, Workplace Gender Equality Agency, September 2015, www.wgea.gov.au.
ii An update on the level and distribution of retirement savingsi. ASfA Research and Resource Centre, 2014, www.superannuation.asn.au.
iii Before bringing your accounts together you should consider fees, loss of insurance cover you may hold, costs for withdrawing from your other super funds and any Investment or tas implications. Speak to yourfinancial adviserbefore making any decision to consolidate your super.
iv Plus any personal contributions for which yau have claimed a tax deduction, such as if you were self-employed.