With the quieter summer holiday upon us now might be a good time to make some super simple changes that could make a lifetime of difference in retirement.
Many Australians are concerned that they won’t have enough money in their super accounts to fund their retirement.
But there are five easy steps workers can take now to boost their savings:
First, check with your fund to make sure you are getting paid all your legal super entitlements. Unpaid superannuation impacts 3 million workers a year – costing them a total of $5 billion and while most bosses do the right thing there are still some employers out there who deliberately rip workers off. And with the super guarantee rate rising to 12% it is more important to check that the full amount is being paid.
Second, consolidate your super funds into one account, finding lost or unpaid super is simple now using the Australian Tax Office tools.
Third, compare your existing super fund with others in the market to make sure it is meeting your needs. New government ‘stapling’ laws mean that workers are likely to stick with funds for longer. Alarmingly only 7% of people switched after they were told their fund failed a government performance test. Being stapled to one of those dud funds can cost a worker $230,000 at retirement.
Fourth, make sure the type of fund and level of insurance is right for you. Make sure the investment strategy matches your needs and appetite for risk – which your fund can help you with. Also be sure to check the insurance coverage is the right fit for you and your family.
Fifth, if you find some loose change or get some type of windfall consider putting it in your super fund. It is a tax-effective way to make savings and with the power of compounding interest a little invested in super now, makes a big difference in retirement. A 30-year-old on average wages that salary sacrifices $20 a week into super has $67,000 more at retirement and gets a tax saving now.
Further tips on boosting your retirement nest egg can be found on Industry Super Australia’s website
Comments attributable to Industry Super Australia chief executive Bernie Dean:
“There are five easy tips to getting your super right and most can be done from the comfort of your deck chair, beach towel or at home.”
“Check you are being properly paid super, consolidate accounts, compare funds, select the right investment mix and make small extra contributions if you can.”
“With the Super Guarantee set to rise to 12 per cent it is even more important to make sure you are getting paid your full legal entitlement and that the fund is working for you.”