I get the frustration surrounding super. There are probably a million other pressing money issues you have to deal with right now before you can even think about the future and of course the government keeps making changes to the rules.
But here’s the thing, women on average live longer than men and around 90% of women will retire without enough in their super account to fund a comfortable retirement. Now there’s a very good reason why we have less super than men. Women tend to earn less than men (I still can’t believe this happens), we take time out of the workforce to raise children or care for aged parents; and may run a single-income household after a divorce. The Association of Superannuation Funds of Australia says the current average super balance at retirement is $292,500 for men and $138,150 for women. While women may have to work harder to boost their super it’s not impossible and there are strategies to overcome the shortfall.
Listen: Monz is a fan of this money guide – and so are thousands of other Aussies.
Whenever I become disillusioned about super though I always take it back to square one. Is it still tax-effective and do I have time on my side? Despite the changes super still offers amazing tax breaks for most of us.
While I don’t intend super to be the only strategy to fund my retirement it does play a major role. The tax perks are the reason. On a 39% marginal tax rate (including 2% Medicare) you’d pay $390 on $1000. However, if you salary sacrifice that $1000 into super you’d pay just $150 in tax because contributions are taxed at 15%. Why give the tax office an extra $240 when you can “pay yourself forward” by putting it into your super fund?
I’m really proud that Super Booster Day is back. Money magazine, in conjunction with the Association of Superannuation Funds of Australia (ASFA), embarked on this initiative to encourage more Aussies to “pay themselves forward”. Our Super Booster Day campaign runs from July 1 to September 15. This year if you join other Australians and make a pledge to pay yourself forward you go in the running to win $1000 to boost your super. There are 5 prizes up for grabs. Visit superboosterday.com.au for details.