Most Australians are coming to realise that they must take more responsibility for supporting themselves in retirement. It is the Government’s intention that a full Age Pension will increasingly be limited to those in real need.

So having a comfortable standard of living in your retirement years is becoming more dependent on how well you prepare for retirement, and in particular how well youSaving for retirement take advantage of the most tax-effective form of retirement savings – superannuation.

Superannuation funds are considered tax-effective because contributions and fund earnings are taxed at up to just 15 per cent rather than your marginal tax rate which can be up to 46.5 per cent (including Medicare levy) Not only that, but when you turn 60 any super you are able to access will be entirely tax-free. The compulsory superannuation contributions made by your employer on your behalf will not provide more than a basic lifestyle. You need to contribute more to gain a level of comfort in retirement. There are several strategies that can help you maximise your super:

Salary sacrifice

You could consider entering into a salary sacrifice arrangement for next financial year if your employer allows it and if appropriate for your particular circumstances.

Super investment strategy

If your super is invested in cash or other conservative investments, you may be able to increase your investment returns with a higher proportion of growth investments (eg shares). It’s important to remember the fundamentals of investing; markets are cyclical and eventually shares will regain value, but in the meantime, opportunities may arise. A difference of just 2 per cent per year can make a vast difference to the sum you have at retirement

Super Contributions

There are two ways you can contribute to super:

  1. Concessional contributions are made with pre-tax money and, provided you have not exceeded your limit, are taxed concessionally, up to just 15 per cent. The concessional contribution cap is $25,000. However, as of 1 July 2013, the concessional contribution cap has increased to $35,000 from for those aged 60 or more, and from 1 July 2014 for those aged 50 or more.
  2. Non-concessional contributions are after-tax contributions and it’s worth considering these contributions, especially if you are eligible for a co-contribution from the Government (you could receive up to $500 this year) or if you intend making a spouse contribution (you could qualify for a tax offset).

Spouse contributions

Often one spouse accumulates the majority share of the super. Increasing your spouse’s superannuation can help reduce your family’s annual tax bill.

Consolidate your super

If you have your super in more than one account, you are probably paying more fees than you have to. Consolidating your super into one account will help you pay less in fees and charges.


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Thomas Jacks BCom (Acc), SMSF SpecialistTM, Adv. Dip F.S. (FP)
“I want to be able to assist clients with their investment and retirement planning by providing real strategy advice. It’s my aim to not only help my clients but to educate them by addressing the entire picture” Google Plus

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