You may have recently read our blog on why you should have an annual check-up for your superannuation fund. We had such a great response that we invited our expert Miral Thakker back to ask him how our clients can boost their superannuation.
Whether you are retiring tomorrow or just starting out in the workforce a number of strategies can be implemented to assist you plan for your retirement.
Your employer puts an amount equal to 9.5% of your salary into your super. Employers must pay this money into your super at least once a quarter^. Miral shared with us his hot tips on boosting your super.
“You can start by looking at your before tax contributions (using salary sacrificing) as not only does this bump up your super but also reduce your taxable income, saving on the tax paid to the ATO”, says Miral. It can be tax-effective if you earn more than $37,000 per year^. “The contributions are limited up to $25,000 per year. So your contributions plus your employers contributions must not be greater than $25,000”, advises Miral.
“The additional salary sacrificed monies before tax put into your super is taxed at 15% instead of your marginal tax rate. This amount can be worked out so you know what you would receive net into your bank account each pay”, says Miral.
Another way to boost your super is to make contributions directly into your super account. “These contributions are not tax deductible. They are capped at $100,000 but can bring forward 2 future financial years contribution and contribute a total of $300,000”, advises Miral.
If you earn less than $51,813 per year (before tax) and make after-tax super contributions, you are eligible for contributions from the government. This is called the government co-contribution^. “If your income is less than $36,813, you can make additional contribution into your super from your after Tax income and the government will contribute $500 into your super’, advises Miral.
“My final tip is to ensure that you have consolidated your accounts into one fund. And speak to a professional as we keep up to date with the changes so you don’t have to”, says Miral.
There may also be other ways of boosting your superannuation (including the First Home Buyers Superannuation Scheme, Low Income superannuation tax offset, Spouse contributions etc..) but these depend on which stage in life you are at. As always it is best to speak to an expert to help you find a strategy that works for you.
We offer all our clients to undertake a complimentary (no obligation) superannuation review. Contact us today on 1300 857 762 to see how you can grow your nest egg.