For most people, Superannuation is the largest investment they will make in their life – other than purchasing a home or business.
Superannuation is usually the most tax-effective way to save for retirement.
Why do you need Superannuation ?
After the Global Financial crisis, it has become obvious that Government will not be able to provide a comfortable retirement for everyone out of public funds. So to be financially secure, you will need to self-fund your retirement through Superannuation.
When to start saving into a Superannuation fund
Your total amount of Superannuation at retirement depends on when you start investing as well as the returns you get on your investment over your lifetime. The obvious message here is to start saving into Superannuation as soon as you can and to choose investments that match both your tolerance to risk and time left to invest before retirement. Start paying into Superannuation as soon as possible so that you can take advantage of the available tax concessions and benefit from compounding returns on your Investments. It is never to late to start investing into Superannuation but you may have some catching up to do with the help of one of our Advisors.
How much Superannuation should I have
That depends on how much income from your Superannuation you think you’ll need in retirement and how long you expect to live. Settle on an annual income figure and work backwards, i.e. how much you would need to save to earn that income over that period of time. Remember to use conservative estimates when looking at annual rates of return from your Superannuation Investments – it is better to be on the safe side than to leave yourself short. Our Advisor’s can help you work this out.
Superannuation and Estate Planning
Estate planning is a process that needs to take account of all your assets. Superannuation is a major part of this planning process for several reasons.
One reason is that when you die, your Superannuation payout is likely to be the biggest financial asset available to your family. It may even be worth more than your home, so it needs to be thought about very carefully.
A second reason is that on death, your Superannuation is treated differently from other assets such as your house, car, and other valuables. Most other investments form a part of your estate when you die, but that is not always the case with your Superannuation.
Thirdly, Superannuation is highly regulated by the government because of its tax advantages. The tax rules that apply to your Superannuation when you die are not the same as those applying to other assets, so Superannuation needs to be dealt with specifically in your plan.
Finally, Superannuation, unlike most other assets, has the flexibility to be able to add to your Superannuation value by “topping up” your life insurance cover (within your Superannuation) to pay a larger benefit if you should die.
The added flexibility is very useful in estate planning as it helps you to shape your Superannuation plan precisely to your specific needs and objectives.
Don’t wait any longer
Anyone who has Superannuation should also have some sort of estate plan. It doesn’t need to be complex. Just a few simple preparations now, can eliminate uncertainty and possible hardship for those you leave behind, as well as avoiding unnecessary tax.
Reviewing your Fund?
Contact us to discuss your options.
Retirement Time Financial Planning 0754061224
1300 660 707
288 Main Road Kuluin
Sunshine Coast 4558
Sunshine Coast 07 5406 1224
Brisbane 07 3503 1404
Gold Coast 07 5630 6647
Sydney 02 9016 5683
Darling Downs 07 4602 9002