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How to grow your super before retirement

A super balance of $1 million is often presented as the magic number for a comfortable retirement.

But most experts say it depends on your lifestyle and retirement expectations. Variables include whether you own your own home outright, your health and dependents who need or may need your financial assistance.

The size of your retirement nest egg will be determined by your individual goals and circumstances. But there are a number of practical strategies you can use to boost your super before retirement:

  • Delaying retirement: For the 2024-25 financial year, employers are required to contribute 11.5% of your salary to your super account. This is known as the superannuation guarantee (SG) contribution. Postponing retirement, to work a little longer, or continuing to work at reduced hours, can help with financial security by receiving further employer contributions to your superannuation.
  • Consider salary sacrificing: Salary sacrificing can be an effective strategy to boost your superannuation savings. It allows you to arrange with your employer to make additional before-tax contributions to your super account, which are taxed at a flat rate of 15%. These contributions are included in the concessional (before-tax) contribution cap, which is currently set at $30,000 per annum and includes employer contributions such as superannuation guarantee contributions, as well as personal contributions for which you claim a tax deduction.
  • Make after-tax contributions: After-tax contributions can be an effective way to boost your super. These contributions are made from your after-tax income and are included in the non-concessional (after-tax) contributions cap. The current cap is $120,000 per annum. You may be able to bring forward up to three years of after-tax contributions, depending on your total super balance and age.
  • Spouse contributions: If your spouse is a low income earner (earning up to $40,000 per year), you can make super contributions on their behalf and claim a tax offset of up to $540 per annum. This tax offset is calculated as 18% of the contributions made. To be eligible, you must be married or in a de facto relationship with your partner and both of you must be Australian residents.
  • Government co-contribution: If you earn less than $60,400 per year and make after-tax super contributions, you may be eligible for a government co-contribution of up to $500 per year. This co-contribution is paid directly into your super account after you’ve lodged your tax return for the year.

Using these strategies can help you maximise your super and retire comfortably.

However, as a general starting point, you can use the Money Smart calculator to work out:

  • How long your account-based pension will last
  • How investment returns will affect your pension balance.

 

Source: Perpetual

Hardik Gupta

Senior Paraplanner

Education: Master of Business Administration (Finance & marketing) & Bachelor of technology (B.tech)

Hardik is a financial professional with an MBA in Finance and extensive expertise in financial planning. As a Senior Paraplanner, he brings a wealth of knowledge and a deep commitment to helping clients achieve their financial goals.

With significant experience in the financial industry, Hardik excels in creating detailed financial plans, performing comprehensive financial analyses, and supporting financial advisors with client portfolio management. His strong background in finance provides him with a robust understanding of market dynamics, investment strategies, and risk management, enabling him to deliver tailored solutions that align with each client’s unique needs.

In his free time, Hardik enjoys spending quality time with his family, biking, playing snooker, and exploring new culinary delights through cooking.

Mayank Manta

Team Leader

Master’s of Commerce & Bachelor of Commerce

Mayank has 8 years experience in the Financial Services industry, with extensive understanding and in-depth knowledge of Financial Planning.

Mayank enjoys systems and numbers, ensuring that every step that needs to be followed gets done and every step that is unnecessary be removed from the process. Being an open, honest and naturally empathetic person, Mayank goes out of his way to ensure that clients, family and friends are happy and content. In his free time, Mayank enjoys spending quality time with my family, creating lasting memories with the people who matter most to him.

Another activity he enjoys is travelling – exploring new places and experiencing different cultures is something that excites him.

Jack Wyer.

Financial Adviser

Bachelor of Business – Major, Financial Planning

Jack Wyer is a Financial Planning Graduate who has recently commenced his Professional Year with Verity Wealth Solutions. With a Bachelor’s Degree in Business, Majoring in Financial Planning, Jack has demonstrated high achievement, receiving merit awards in both 2021 and 2022. Jack’s passion for helping others and his desire to see others succeed financially have been the driving forces behind his chosen career pathway.

Driven by his passion for financial well-being and his innate ability to connect with others, Jack is dedicated on making an impact on the lives of others. Through his expertise, empathy, and commitment, he strives to empower people to achieve their financial goals.

Alongside his financial planning endeavours, Jack finds joy in spending quality time with friends and family and wants to slowly visit new countries along the way. Jack is also an avid Soccer player, actively playing for a local team. When it comes to supporting a team, Jack goes for Tottenham in the English Premier League.

Jack Wyer’s Adviser Profile