Make the most of your superannuation. Super is one of the most tax effective ways to save for your future. Here are a few things you may want to consider to help you make the most of your super.

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Salary sacrifice and tax advantages

Your employer contributes 9.5% of your salary towards your super, but this may not be enough to give you the kind of retirement you'd like to have. By increasing your contributions, you’ll have a more comfortable retirement and be able to save on tax. Salary sacrifice is one way you can make a before-tax contribution to your super. This is where you 'sacrifice' some of your salary and put it towards your super.

It can help you to save on tax by:

  • Reducing your taxable income, which means you could end up paying less tax and, depending on how much you contribute, you could even drop down a tax bracket.
  • Allowing you to benefit from the lower tax rate on your super contributions, which are taxed at a maximum of 15%.

In addition, the tax paid on the fund earnings is only up to 15% instead of up to 45% on other investment earnings outside of super.

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Consolidating your super

If you have multiple super accounts from changing jobs over the years, you may want to consolidate them into one. This could save you money in fees and charges, and a larger combined account balance may generate a larger return. It also means less paperwork to worry about.

Before you do, consider:

  • Which is the right fund for your needs?
  • Are there any termination fees?
  • Can you get the same level of insurance?
  • Can your employer contribute to your preferred fund?
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Invest your super wisely

It's important to understand where and how your super is invested. For example, is your super invested in line with your personal circumstances and objectives - like your risk profile, and how long until you plan to retire?

Remember, you can choose the way your super is invested – you don't have to invest in the default fund. If your super is mainly in cash or other conservative investments you may be missing out on higher returns that could be generated from a larger allocation to growth investments, such as shares. If you have a longer time over which to invest you may want to consider more growth-oriented investments.

But remember, although growth investments generally offer a higher return over the long term compared to lower risk investment - they come with a higher level of risk.

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Talk to a financial planner

For how to make the most of your super, a financial planner can advise on:

  • Concessional (pre-tax) contributions and non-concessional (after tax) contributions
  • Salary sacrifice
  • Accessing your super while you’re still working to help you transition to retirement
  • Investing your super
  • Contributions on behalf of your spouse
  • Government co-contributions
  • Self-managed super funds and small APRA funds.
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Complimentary initial consultation

Your first consultation with a Bridges financial planner* is complimentary and obligation free.

It’s an opportunity to discuss your expectations and aspirations, as well as your financial circumstances, needs and goals.

Connect with a Financial Planner
Call 133 282 or find your nearest branch.

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* Bridges Financial Services Pty Limited (Bridges). ABN 60 003 474 977. ASX participant. AFSL No 240837. This is general advice only and has been prepared without taking into account your particular objectives, financial situation and needs. Before making an investment decision based on this information, you should assess your own circumstances or consult a financial planner. In referring customers to Bridges, CUA does not accept liability or responsibility of any act or omission or advice provided by Bridges or its authorised representatives. Bridges is part of the IOOF group.