Australia’s population is ageing rapidly. Not only are we an ageing population, we’re also living longer. Life expectancies have increased and thus we now need to plan for at least 20 years in retirement. The problem is, there’s a significant difference between what we expect from our retirement and what most of us will actually be able to afford.
For most people the Superannuation Guarantee (9% of your salary) will probably not be enough to support you comfortably in your retirement. If this sounds like you, it’s not too late to start planning for a secure financial future.
Super is one of the most tax-effective ways of saving for your retirement. The maximum rate of tax you’ll pay on your earnings in your super fund is 15% and you’re not charged tax on withdrawals from super once you turn 60, whereas earnings on your normal savings outside super are taxed at your marginal tax rate, which can be anywhere up to 46.5% including the Medicare levy.
While you can shift your super between super funds, just remember contributions to super are almost always compulsorily preserved. This means that you generally can’t withdraw the funds until you are over 55 (increasing to age 60 if you were born after 1 July 1964) and meet a condition of release.
For a free consultation with a RFS adviser to establish your retirement needs simply call Results Financial Services on 1300 796 663 or contact Financial Services.