4 Practical Tips and Tricks to Grow Your Superannuation
Your superannuation is essentially your savings for retirement. It’s considered a long-term investment making every dollar you save count towards your desired retirement life.
Most Australians seek to live a comfortable lifestyle during their retirement phase. This usually means having the financial freedom to have day-to-day peace of mind during your entire retirement phase. Retirement should be an opportunity for you to do things you’ve always wanted to do during your working life.
Learning how you can grow your superannuation will not only increase your retirement savings, but it will more than likely help you achieve your dream retirement.
Here are four tips and tricks for you to keep in mind if you are wanting to grow your superannuation:
1. Consolidating your Super Funds May be Beneficial for you
There could be a number of reasons as to why you might have more than one super fund. You may have started a new job and you didn’t nominate your super fund with your new employer.
The main purpose in consolidating your super can be to save you time and money.
Having all of your super in one account can:
- Save you some money by only having to pay one set of super fund fees
- Enable you to easily track your super balance
- Allow you to be confident that your super is on track to grow as much as possible
Although there are some great benefits to consolidating your super funds, there are also some factors you should consider before doing so.
You should consider:
- Reviewing if you have purchased any form of personal insurance through one of your funds before closing one of them, as you might not be able to receive the same cover
- Checking the performance of your super funds and selecting the highest performing superfund.
If it comes down to you deciding to consolidate your super funds, you may want to ensure you have done everything in your power to ensure you are making the best financial decision for yourself. A helpful way in ensuring this is by seeking advice from a financial adviser, who can review your superannuation options with you.
2. Is it Time for a Super Health Check?
Essentially, a super health check can mean ensuring you are making the most out of your super fund. Experts usually recommend reviewing important aspects of your super fund once per year. The important aspects to review include:
- Your super fund performance, to ensure you are maximising your super balance,
- The fees you are currently paying may be higher than other funds,
- Checking if you have insurance under your super fund; how much is this costing you and does the level of cover meet your needs?
A financial adviser can help you determine if your super fund is underperforming.
3. Review your Investment Strategy:
Whether it’s you or your employer putting money into your super fund, this money gets invested by the fund with the aim of growing your super balance over a long period of time.
It’s important for you to know that most funds enable you to choose from a range of investment options. It may be worthwhile for you to take the time to check your investment options and decide which is right for you. These options usually range from conservative to balance to growth. Here are your general super investment options:
- Conservative: aims to reduce your risk of loss, which entails gaining a lower return over the long term.
- Balanced: aims to gain reasonable returns, but still less compared to growth funds to reduce the risk of losses.
- Growth: Is the most risky option, however with higher risk usually means higher returns in the long-term.
You can find more information about what investment options your fund is offering through the funds website or its product disclosure statement (PDS). Many super funds are now offering an ethical investment option, which might be more suited to your values.
It’s important to note that you are able to change investment options at any time you please. However, it may be wise to seek financial advice beforehand to ensure you are making the most valuable financial choices for your future.
4. Make Voluntary Contributions to Your Super?
A simple way of growing your super, can be by making your own personal contributions to your super. There are two types of voluntary contributions that you can explore if you think this may be of benefit to you.
They are known as:
- Concessional Contributions: are payments put into your super fund from your pre-tax income. This type of contributions are taxed at 15%, which is usually lower than your marginal tax rate. If this is the case, this means you will be paying less tax while boosting your retirement savings.
- Non-concessional Contributions: are payments made after you’ve paid tax on the money. The benefit to this contribution is that you are able to make up to $110,000 contributions each financial year to boost your nest egg!
If you are in a position to make voluntary contributions, it can be useful contacting a financial adviser to achieve the most effective financial outcome for you.
Superannuation and Retirement Planning In Ballarat
It’s important to make smart decisions when it comes to things that will affect your future. When you make the right investments for retirement, you can ensure financial security for yourself. Growing your superannuation is one way to attain financial stability when you retire.
If you want assistance from experienced wealth management advisers, you can trust Blue Financial Ballarat. We offer financial advice and superannuation advice to help you prepare for your retirement.