Boosting your super

Salary Sacrifice into super:  Did you know that if you salary sacrifice into super, and contributions are paid to a complying superannuation fund, you can end up with more super, and could also pay less tax along the way.  Super is tax effective with contributions taxed at 15% (up to certain limits – see ATO.gov.au for more details).  For those people who are on a tax rate higher than 15%, it’s a tax effective investment.  It is important to remember that you generally cannot access any money you contribute to super until you reach your preservation age and retire from the workforce.

Extending paid maternity leave to all: Government election promises – starting in 2011, there will be minimum levels of paid leave for some women who have babies or adopt.  But not all will receive salary and super while on maternity leave as part of the terms and conditions of employment.

Government Co-Contribution: If you earn less than $31,920 in the 2009/2010 financial year and make after-tax super contributions of $1,000 in that year, you may get the maximum Government co-contribution of $1,000 (conditions apply).  This doubles your contribution to $2,000. If you earn up to $61,920, co-contributions are still available, but at reduced rates. [5]

Contributions Splitting:  Super contributions can also be split to a spouse’s super account subject to certain age and workforce participation conditions.  This provides for single income families to split superannuation benefits in a similar way to dual income families.  The rules are complex but it’s worth considering – especially for high income earners, where one spouse is either not working, or with making low super contributions. [6]

Lost super. Many Australians have lost super…they just don’t know it…so it’s definitely worth checking if some of yours is lost.  And from 1 July 2010, the ATO plans to start automatically closing some old super accounts and transferring them to a person’s current account.

At Magenta Wealth Pty Ltd, we provide a spectrum of smart financial solutions essential to your changing life.  We work to make your goals and dreams a reality, by saving you money, saving you time, saving you tax, nurturing your wealth and protecting your assets. We offer a new alternative to financial planning,  working hard and with passion to create your vibrant financial future.  Call us for an obligation free consultation on 02 9922 5550 or find us at Magentawealth.com.au
Magenta Wealth Pty Ltd  (ABN 63 411 278 984) trading as Magenta Wealth, and Deborah Barr are authorised representatives of AMP Financial Planning Pty Limited (Australian Financial Services Licence No. 232706).

General Advice Warning: Any advice in this document does not take account of your personal circumstances. Before relying on it to make a decision, you should consider how it applies to your overall circumstances or get personal advice.  FSG disclosure: “If you decide to purchase or vary an AMP product, your financial planner, AMP Financial Planning Pty Limited and companies within the AMP group will receive fees and other benefits, which will be a percentage of either the premium you pay or the amount you invest.  You can ask us for more details about this”.

[1] http/money.ninemsn.com.au/ super and planning /Westpac changes parental scheme 5/7/10

[2] Moneymanager.com.au

[3] Moneymanager.com.au

[4] The Association of Super Funds of Australia, Media Release, 31 August 2009

[5] Ato.gov.au/superfunds

[6] Ato.gov.au/superfunds