We all know that our superannuation plays a major role in our retirement and often we tend to put it on the back burner. Since our superannuation isn’t really tangible, at least this is the case with many until they actually reach retirement age, we can easily forget just how important growing our Superannuation is to us.
If we start to think about our superannuation now, we can start making changes earlier that will have a positive impact on our retirement, making it all the more comfortable. We all want to grow our superannuation balance, and whether you’re working casually or running your own business there a few simple things you can start doing now to help grow your Superannuation.
1. Tracking Employer Contributions
As a working Australian we are granted the rights to receive Superannuation guarantee payments from out employer. Superannuation Guarantee payments, also known as employer contributions often make up the bulk of our superannuation balance.The first step you can take towards growing your superannuation balance is to first ensure you meet the eligibility requirements to receive superannuation guarantee payments.You can check your eligibility on the Australian Taxation Office website. Generally, if you are over the age of 18 and are earning a minimum of $450 a month you are eligible to receive employer contributions.
Once you’ve determined your eligibility, follow up with you superannuation fund and ask for a report for the last 12 months outlining all contributions that came into your account.This will help you track your employer contributions and will also ensure that your employer is contributing on your behalf.Once you have an idea of how much you receive in employer contributions you can move onto the next step in growing your superannuation.
2. Salary Sacrifice Arrangement
Many employers will often allow their employees to ‘salary sacrifice’ a portion of their salary.This is an arrangement between you and your employer, where your employer agrees to pay a portion of your pre-tax salary as an additional concessional contribution. Not only is this a tax effective strategy but it’s also a great way for you to start saving for your retirement.The additional concessional contributions will add to your superannuation balance growing it to where you want it to be.
3. Make Your Own Personal Contributions
The last step you can take towards growing you superannuation balance is by making non-concessional (after-tax) contributions to your superannuation account.This is definitely an active approach that will add up in the long run.Even start by contributing $50 a fortnight, in 10 years that $50 will turn into $12,000. Such small steps can really make a big difference in your superannuation balance.
So, don’t think you need to start making drastic changes or investing all your income into your superannuation fund all you need to do is start small and you’ll finish big.
LifeTime Financial Group are specialist (holding appropriate accreditations)advisors who are ideally positioned to assist you in selecting and then managing your retirement funds.
Would you like to discuss your personal position further with one of our highly qualified financial planners? Why not call us today on 03 9596-7733.
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Written by Adam Watts of LifeTime Financial Group. A leading privately owned Melbourne Financial Planning practice.