If you have done some personal calculations and you have a gap between what you’ll have versus what you’ll need, you have the opportunity to fill that gap.
If you haven’t done any personal calculations, this is a good time to start. It’s one of the only ways you’ll have a clear understanding of whether you have a gap, whether you’re on track and what you need to do if there is an issue with either.
If you’re on track to having a nest egg that would support you in retirement and deliver the lifestyle that you want, congratulations and well done! If you’re not, there are a number of different options available that may help you increase your savings, to support you when you stop work. Here’s an overview of what you can do (among other things):
- Consider salary sacrifice
- Top up your super with after-tax contributions
- Find any super you may have lost track of by logging in or registering for MyGov , and then consider if keeping multiple account or bringing your super accounts together is right for you
- Take advantage of the Governments co-contributions scheme
- Consider spouse contributions
- Understand downsizing rules and the option of contributing some of the proceeds to super.
Making the most of your super also includes remembering that there are limits to how much you can contribute to your super each year. If you breach these ‘contribution caps’ you may need to pay extra tax. Your total super balance and age may also affect how much more you can contribute. It’s important to keep a track of your contributions and be aware of the limits to avoid any unexpected tax implications.
There are different kinds of contributions you can consider. It’s important to understand the difference, as this can impact how much tax you pay. Here’s an overview:
Concessional contribution caps
Concessional contributions are contributions made from your before-tax income, including your compulsory super contributions (also known as super guarantee) and salary sacrifice. It also includes any personal contributions using after-tax income (such as funds transferred from your bank account into super) that you’ve claimed a tax-deduction on. For the 2024-2025 financial year, the concessional contribution cap is $30,000 per annum.
Non-concessional contribution caps
Non-concessional contributions are contributions made from your after-tax income and aren’t taxed once received by your super fund. However, if you exceed your non-concessional caps you may need to pay extra tax. Also note, investment earnings in the fund are taxed at 15 per cent. For the 2024/2025 financial year, the non-concessional contribution cap is $120,000 per annum. This cap might be higher, if you can use the bring-forward arrangement.
Wrap up
Superannuation can be a complex arena, so it’s important to make sure you’re comfortable in the knowledge that you know which contribution option is best for you. If at any time you’re unsure, it’s good to reach out to your super fund who can provide you with general information. If you want specific information relevant to your particular situation, speak to your financial planner. If you don’t have a financial planner, reach out to the Financial Advice Association Australia, who can help put you in contact with one.
If you have done some personal calculations and you have a gap between what you’ll have versus what you’ll need, you have the opportunity to fill that gap.
If you haven’t done any personal calculations, this is a good time to start. It’s one of the only ways you’ll have a clear understanding of whether you have a gap, whether you’re on track and what you need to do if there is an issue with either.
If you’re on track to having a nest egg that would support you in retirement and deliver the lifestyle that you want, congratulations and well done! If you’re not, there are a number of different options available that may help you increase your savings, to support you when you stop work. Here’s an overview of what you can do (among other things):
Making the most of your super also includes remembering that there are limits to how much you can contribute to your super each year. If you breach these ‘contribution caps’ you may need to pay extra tax. Your total super balance and age may also affect how much more you can contribute. It’s important to keep a track of your contributions and be aware of the limits to avoid any unexpected tax implications.
There are different kinds of contributions you can consider. It’s important to understand the difference, as this can impact how much tax you pay. Here’s an overview:
Concessional contribution caps
Concessional contributions are contributions made from your before-tax income, including your compulsory super contributions (also known as super guarantee) and salary sacrifice. It also includes any personal contributions using after-tax income (such as funds transferred from your bank account into super) that you’ve claimed a tax-deduction on. For the 2024-2025 financial year, the concessional contribution cap is $30,000 per annum.
Non-concessional contribution caps
Non-concessional contributions are contributions made from your after-tax income and aren’t taxed once received by your super fund. However, if you exceed your non-concessional caps you may need to pay extra tax. Also note, investment earnings in the fund are taxed at 15 per cent. For the 2024/2025 financial year, the non-concessional contribution cap is $120,000 per annum. This cap might be higher, if you can use the bring-forward arrangement.
Wrap up
Superannuation can be a complex arena, so it’s important to make sure you’re comfortable in the knowledge that you know which contribution option is best for you. If at any time you’re unsure, it’s good to reach out to your super fund who can provide you with general information. If you want specific information relevant to your particular situation, speak to your financial planner. If you don’t have a financial planner, reach out to the Financial Advice Association Australia, who can help put you in contact with one.