FAQ's about Super

TL;DR

This video addresses key questions about superannuation, including how much is needed to retire, the tax implications, contribution options, withdrawal age, and estate planning.

Transcript

g'day and welcome to this week's video my name is ashley rowan and i'm a financial advisor with consulting private wealth during our day-to-day points there are a number of questions that we get asked as advisors in relation to superannuation and we understand that it's a complex field and yeah it is quite difficult to navigate at times so i though... Read More

Key Insights

• 🧑 Retirees should aim for savings of around $640,000 as a couple or $545,000 as a single person for a comfortable retirement.
• 🚕 Concessional contributions are taxed at 15%, while non-concessional contributions are taxed at 0%.
• 🚱 Employer contributions, salary sacrifice, and personal non-concessional contributions are common methods of contributing to superannuation.
• 🤕 Access to superannuation is allowed at age 65, preservation age (around 60), or in cases of severe financial hardship or specific medical conditions.
• ❓ Binding death nominations are important for determining beneficiaries of superannuation benefits.
• 🤩 Starting early and investing in growth assets are key strategies for maximizing superannuation.
• 🆘 Regular reviews with a financial advisor can help optimize superannuation strategies.

Questions & Answers

Q: How much do I need to retire comfortably?

According to the Association of Superannuation Funds of Australia (ASFA), a couple needs around $640,000, while a single person needs $545,000 for a comfortable retirement lifestyle.

Q: How is superannuation taxed?

Concessional contributions (employer and personal) are taxed at 15%, while non-concessional contributions are taxed at 0%. Investment returns within the fund are taxed at 15% in the accumulation phase but become tax-free in the pension phase.

Q: What are the main forms of superannuation contributions?

The most common forms are employer contributions and salary sacrifice. Employee contributions are currently set at 10% of earnings, with an annual concessional cap of $27,500. Personal non-concessional contributions can also be made, with a more generous cap of $110,000 per year.

Q: When and how can I access my superannuation?

Full access to superannuation is allowed at age 65. Preservation age (around 60) allows access with limitations, but retirees face no restrictions. Severe financial hardship or specific medical conditions can also enable access, but strict rules apply.

Summary & Key Takeaways

• Retirees need approximately $640,000 as a couple or $545,000 as a single person for a comfortable retirement lifestyle.

• Super contributions can be concessional (taxed at 15%) or non-concessional (taxed at 0%), with different tax rates for accumulation and pension phases.

• Employer contributions and salary sacrifice are common forms of contribution, with caps to consider. Personal non-concessional contributions have more generous caps and may qualify for government co-contributions.

• Superannuation can be accessed at age 65 or preservation age (around 60) for certain conditions, with full access for retirees, but restrictions for those still working.

• Binding death nominations can determine beneficiaries of superannuation benefits, including spouses, children, dependents, or legal personal representatives.

• Strategies for maximizing superannuation include starting early, taking advantage of government co-contributions, optimizing contributions near retirement, and investing appropriately with a focus on growth assets.