Six ways to grow your super
Posted on April 03, 2023
Superannuation is an essential part of retirement planning, and it's never too early to start thinking about growing your super balance to ensure a comfortable retirement. While there are several ways to increase your super balance, consolidation, additional contributions, and tax planning can significantly boost your retirement savings.
Consolidate your Super
One of the simplest ways to grow your super is to consolidate all your super accounts into one. People often have more than one superannuation account if they have changed jobs a few times. Some people may not even know they have more than one super account. The good news is, it’s very easy to find your lost (or forgotten) super using your myGov account.
Consolidating your super accounts will help you avoid paying multiple fees and charges, which can eat into your retirement savings. It also simplifies your record-keeping and makes it easier to keep track of your retirement savings.
Make additional Super contributions
Making additional contributions is an effective way to grow your super balance. Even small payments can add up over time and make a significant difference to your retirement savings. For example, contributing an extra $50 per week to your super over 30 years could result in an additional $100,000 or more in retirement savings (depending on investment returns and fees).
There are several ways to make additional contributions, such as salary sacrifice, after-tax payments, and government co-contributions.
Before-tax vs after-tax Super contributions
Before-tax contributions, also known as salary sacrifice contributions, are made from your pre-tax income, reducing your taxable income and lowering your tax bill. After-tax contributions, also known as non-concessional contributions, are made from your post-tax income and are not taxed when they are paid into your super fund. Both types of payments can help you grow your super balance.
Spouse Super contributions
Spouse contributions are a great way to boost your partner's super balance while reducing your tax bill. If your spouse earns less than $37,000 a year, you can receive a tax offset of up to $540 by making after-tax contributions to their super account from your income.
Government Super co-contributions
The government offers a super co-contribution scheme to help low and middle-income earners boost their super savings. If you earn less than $57,016 a year and make after-tax contributions to your super account, the government may match your contributions up to a certain limit.
Downsizer Super contributions
If you are over 55 and sell your family home, you may be eligible to make downsizer contributions to your super account. Downsizer contributions allow you to contribute up to $300,000 from the proceeds of the sale of your home into your super account, providing a tax-effective way to boost your retirement savings.
Get comfortable for retirement
Growing your super balance is essential to ensure a comfortable retirement. Consolidating your super accounts, making additional contributions, and tax planning can significantly increase your retirement savings. Consider speaking with a financial adviser to explore your options and develop a plan that best suits your financial situation and retirement goals. With careful planning and strategic contributions, you can grow your super balance and enjoy a comfortable retirement.
If you have questions about how to grow your superannuation for your retirement, be sure to get in touch with us.
General advice warning: This advice is general in nature and does not take into consideration your specific needs or circumstances. You should look at your own financial position, objectives and required and seek financial advice before making any financial decisions.
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