Superannuation - Hello Wealth

Superannuation

Super funds are an investment in your retirement, and therefore in your future.

As specialists in this area of Financial Planning for nearly twenty years, the role of Hello Wealth is to empower clients to live in the present while consciously planning for that future.

With personalised and sophisticated strategies Hello Wealth can put you in a position to reap the immediate benefits of superannuation without compromising cash flow. We understand that clients need to afford the now, while thinking of the future if and when they can – sowing the long-term benefits of accumulating wealth for the day you can finally stop working.

Essentially trust funds, a trustee is appointed as manager and restrictions are enforced that limit withdrawals before retirement or preservation age without special conditions of release.

It’s worth noting that superannuation funds receive special tax treatment that makes them one of the most tax effective ways to save for retirement, while broader investment options such as shares, property and fixed interest investments- offer impressive opportunities for growth.

The Advantages

Super is designed to reward long term investing and is compulsory for employees, with Superannuation Guarantee (SG) contributions introduced to help the workforce better plan for and manage retirement.

Insurance premiums – an integral part of super contributions – may also be paid from pre-tax salary; a tax-effective way to enjoy protection vital to you and to your family.

Interested to see how you’re tracking and determine what strategies you can use to reach your goals?

Contact us today and ask your financial adviser about the Hello Wealth Super Simulator.

How It Works

The most common type of super fund is an accumulation (managed or investment) fund with advantageous tax treatment on contributions and earnings until retirement.

If you have an abundance of  both assets and time, you may want to consider a self managed super fund and make the move towards controlling your own super.

Making Contributions

Concessional (pre-tax income) contributions are taxed at 15% – significantly lower than the marginal tax rate – while there is zero tax on non-concessional (post-tax income) contributions.

There are however caps on both of these which vary depending on the age of the contributor.

The Benefits

Super earnings are taxed at up to 15% (and only 10% on capital gains), which is generally lower than the marginal tax rate. And if you start a pension at retirement the tax on earnings in super reduces to nil.

Money withdrawn after the age of 60 is tax free.

Super balance (also called benefit) can be withdrawn at preservation age, which varies depending on birth date but will be 60 across the board by 2025.

Equally, money invested after July 1999 is fully preserved, meaning it can’t be accessed until preservation age is reached.

There are also different tax treatments on lump sum payments depending on the size of this benefit and the age and service period of the member.

The Flexibility

Super is becoming more flexible with effective strategies to reach retirement goals:

  • The government’s co-contribution scheme is designed to help low to middle income earners invest more into their super
  • Concessional contributions can be used to reduce tax
  • A transition to retirement strategy means you can work full time or part time after preservation age and still contribute to your super
  • Self managed super funds now allow for greater control

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