Every year we prepare to file our tax return and we ask ourselves the same thing: are we really getting the most out of our super?
This burning issue has been at the forefront of this fiscal year, with changes to the First Home Super Saver program being a major talking point of the last election.
Whether or not you’re considering buying a home, it’s always worth taking a look at your super to make sure you’re maximizing this untapped resource.
Lost and Found: Consolidate Your Super and Claim Lost Funds
Since 1992, employers’ contribution to super funds has been compulsory. If you held more than one job during this time, you may recall filling out forms to designate your own super fund or your employer’s default pension fund. Choosing the default has left many people with multiple accounts they may not even have been aware of.
Combine that with changed names and addresses and you have a recipe for a whole lot of super unclaimed and unconsolidated, floating unused. The ATO can help you access super unclaimed and lost resulting from changes of name and address.
Although multiple superannuation accounts can be an option to diversify your options, it will also result in multiple sets of account fees. Neglected small accounts may also lack proper growth and attention. Many of our top-ranked super funds also offer a range of investment opportunities, allowing you to diversify your options within a single fund.
Values vs. value – what matters to you in a super fund
Your super is your money and you can choose what matters to you, whether it’s gender-balanced boardrooms or passing on fossil fuel investments!
Responsible super funds – offering a high degree of transparency and integrating environmental, social and governance considerations into their investments – have significantly increased their market share over the past two years. Annual studies by the Responsible Investment Association Australasia (RIAA) have shown that their performance more than rivals other funds in the market.
Other funds also offer options to invest your super in a more targeted way – are you passionate about crypto or do you want to invest according to your religion? Niche fund options make this a possibility. Many also offer the option of being more risky with investments or allowing greater personal control over your portfolio.
Don’t settle for the default – bring your funds to a place where you get the best value that matches your values.
Steps you can take to increase your retirement pension
- Make an extra contribution to your super. If you have the resources, it’s a great way to invest with long-term benefits – contributions paid before tax and up to the concessional cap are also tax deductible, for an added bonus.
- Check if you are eligible for government co-contributions. The past few years have changed the financial situation of many people, and you could do you find yourself eligible to receive an additional government contribution to your super.
- Make sure you don’t over-contribute. Through combinations of additional contributions and salary sacrifices, it is entirely possible to contribute too much money in one fiscal year to your super. Stay aware of concessional (pre-tax) and non-concessional (after-tax) caps, both of which will attract higher taxes if exceeded
Thinking of changing this EOFY super? Our annual round-up of the best public-choice super funds helps navigate the field.