Superannuation is something that many of us forget to think about. And often when we do it’s too late. Superannuation jargon can be confusing and managing your super fund even more so.
There is also generally a huge disconnect between how much Australian’s believe they need to live out the retirement they want, and what they will actually need.
Superannuation in your 20’s
In your twenties, retirement may seem like a long way off, but it’s funny how quickly it will creep up on you. At this age, the focus is often on saving for a house, travel or other investments. But thinking about your super from an early age will pay off in the long run.
The biggest thing to consider at this stage of your life is consolidating all super accounts you might have into one. It’s not uncommon for young Australians to have multiple super accounts with different providers as they jump between various part-time jobs. Consolidating your super accounts means reducing the annual fees paid, which over time, could make a huge difference to your super balance in retirement.
Superannuation in your 30’s
During our thirties, the lack of engagement with our super often continues, as the costs of a mortgage and raising a family take priority.
During this stage of life it is important to consider the benefits of topping up your super with additional contributions versus the benefits of other things you may want to do with your money.
Some ways to boost your super balance include:
- Salary sacrifice
- Personal contributions from your after-tax salary
- Government co-contribution (eligibility tests required to be met)
Superannuation in your 40’s
Your forties are often the time when people start to consider their super, however still have high life costs such as a mortgage.
At this stage of your life it is important to start considering how you see your retirement planning out.
Also, consider making additional contributions where possible to boost your account balance.
Superannuation in your 50’s and 60’s
This is generally the age where people start considering how much they will need for retirement, based on the lifestyle they want to have / continue.
For those that have been planning and saving for their retirement from an early age will often realise they can retire sooner than they had originally hoped.
For those that have failed to do so however, this is the age where they often look to frantically boost their savings by making additional voluntary contributions.
The bottom line is, no matter your age, it’s never too early to start thinking about your super. If you would like to discuss your super further, please contact our office.
This article is general in nature and has not taken into account your objectives, financial situation or needs. Because of this, before acting on any advice, you should consult your accountant or financial planner to consider how appropriate the advice is to your objectives, financial situation and needs.