Practical superannuation tips
At the mention of the word superannuation, it is interesting to see the range of emotions on people’s faces; some visibly shudder, look at you blankly or with a look of suspicion!
We aim to help lift the veil on the subject.
Here are some practical pointers for your benefit:
1) It is a tax effective vehicle for investing. When investing, tax and fees matter. What you care about ultimately is your after tax and after fee actual return. So, the fact that it is one of the best vehicles around for tax efficient investment is important.
2) For most, your employer super contributions (at 9.5%) will not be enough to provide for the type of lifestyle you would like in retirement. It is very highly likely that you will need to make further investments to reach financial security and freedom. The more time you have the better; consider acting on this.
3) We encourage you to take an interest in your super. Are your investments suited to your capacity for risk? Equally, are you invested in a manner which gives every chance of meeting your long-term objectives? How is your money invested? This is a good place to start.
4) If you have multiple super funds, and wish to consolidate them, please take care, as you may find that you lose benefits that you are not aware of. This can be a great reason to seek advice on consolidation, and something we can help you with.
5) Having adequate family protection, potentially within superannuation, is an important consideration. You would not try to build a house without foundations, and building a financial plan without considering family protection is analogous.
6) Salary sacrifice to superannuation; which means giving up some of your pay packet that you would otherwise receive in cash, and instead make additional contributions to super. This can be a tax effective strategy to build wealth and thereby get closer to your objectives. Take care to assess your total position from a ‘helicopter’ view to consider all factors and competing priorities, as, depending on your objectives, it may not be the right strategy for you now.
7) Superannuation nominations dictate what happens to your fund if you pass away. It is a good idea to ensure it is set up correctly as a valid nomination and that your intentions are fulfilled effectively.
As mentioned above, standard employer contributions are not likely to be enough for you to reach ‘financial freedom’, and getting superannuation advice certainly has value for you toward actually achieving this.
Imagine your lifestyle if you have not accumulated enough wealth when it comes time to cease working, or if your time working ceases earlier than anticipated due to factors outside your control. What are you doing to make sure you are on track? Contact us for a confidential discussion.
General advice disclaimer: The information provided in this article (including taxation) is general in nature and does not consider your individual circumstances or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. Where relevant you should read the relevant product disclosure statement and seek personal advice from a qualified financial adviser.
The views expressed in this article are solely those of the author; they are not reflective or indicative of Millennium3 Financial service’s position and are not to be attributed to Millennium3. They cannot be reproduced in any form without the express written consent of the author.
Incito Wealth Pty Ltd is a Corporate Authorised Representative of Millennium3 AFSL 244252
Disclaimer: Millennium3 Financial Services Pty Ltd ABN 61 094 529 987 AFSL 244252. The information provided in this document is general information only and does not constitute personal advice. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information please contact our office to opt out. The views expressed in this publication are solely those of the author; they are not reflective or indicative of Licensee’s position, and are not to be attributed to the Licensee. They cannot be reproduced in any form without the express written consent of the author.