Daily life is busy and, with retirement years away for many of us, it’s tempting for our superannuation to be out of sight and out of mind. The ‘I’ll get to that later’ mentality. But time flies, and being even just a bit proactive with your super now, could significantly enhance your lifestyle later.
Tip 1 Keep track of your super. Alarmingly, there is $18.8 billion across 5.8 million super accounts in Australia where owners have lost touch with these accounts1. Check if some of it could be yours at www.ato.gov.au/superseeker.
Tip 2 Consolidate – if you have more than one super account, consider combining it to save on fees.
Tip 3 Take advantage of tax effective saving – superannuation’s considerable tax advantages can make it an attractive way to save for retirement. Just 15 per cent tax on contributions and up to 15 per cent on earnings is often lower than marginal tax rates, helping get your money tree growing. Once you turn 60 and have stopped working, access is tax-free, and if you convert it into a super pension, investment earnings are tax-free.
Tip 4 Increase your contributions – you can improve super’s tax advantages by contributing more – perhaps irregular amounts such as proceeds from a tax return, inheritance or another lump sum. Or you can arrange with your employer to take home less pay and have the difference put into your super before income tax. The Government places limits on contribution amounts so ask one of our advisers to help you work out the best way to enhance your super.
Tip 5 Get informed – making an informed choice about where and how your super is invested can also make a big difference to how much you’ll enjoy later. A qualified adviser can help you consider fees, investment performance and services like insurance in super – as well as choosing investments to suit your personal needs.
Tip 6 Get started early – super is a long-term investment and you could be invested in interest earning investments, which can really stack up over time. Being proactive means you have more time on your side so that your retirement savings can be even more super and contribute to a brighter future for you and
1. The Hon Bill Shorten MP, Making it Easier to Find Lost Super, media release, 4 February 2011