Small steps to help you maximise your super

With the cost of living and life expectancy both rising, it has never been a more important time to make sure your super is in good shape.

Money Magazine’s Effie Zahos shared her tips on how to maximise your super and enjoy your retirement years.

TODAY: Not having enough super in retirement is a fear for many Australians. How much do we need?

EFFIE: The Association of Super Funds of Australia (ASFA) says that to fund a “comfortable” retirement, home owning couples need $640,000 in super and singles $545,000.  This assumes retirees will draw down all their capital and receive a part age pension.

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TODAY: How do we maximise our super savings?

EFFIE:  Push for permanent employment. Rethink cash in hand and don’t forget to consolidate your super funds.

TODAY: Is there a way to boost your super without putting money in?

EFFIE: Ask your spouse to lend a hand. If you earn less than $40,000 annually, ask your spouse or partner to make a contribution. It could see your other half entitled to a tax saving of up to $540 under the spouse super tax offset.

Another tip. Watch for fund fees.

Most superannuation funds also let their customers choose how their superannuation balance is invested, usually in one of two ways: ‘investment strategies’, or by specified asset allocation.

TODAY: What happens if you are about to retire and you don’t have enough?

EFFIE: Don’t stress too much. If you have modest savings you will get the age pension and do much better than someone with a lot more in super, up to a certain level.

TODAY: What else do we need to be aware of?

EFFIE: The new age pension asset test rules have some harsh consequences for home-owning couples with superannuation balances between $400,000 and $1 million. Those with a lot more in super will be worse off in terms of income than a couple with $400,000 because above that amount they lose $3 a fortnight in the age pension for every $1000 in assets above the threshold. There is a no man’s land where your ability to access the age pension plunges and your superannuation income many not be high enough to replace it.

* In highlighting particular offers we are not making specific recommendations as this article does not cover all available products and may not compare all features relevant to you. Any advice provided is general in nature and does not take account of your needs, objectives or financial situation. Individuals should consider their own circumstances, and if in doubt seek appropriate advice, before proceeding.