$500 is up for grabs

Money Magazine Australia - - SUPER -

If you earn $37,697 or less for the 2018-19 fi­nan­cial year and make an after-tax con­tri­bu­tion of $1000 to your su­per fund be­fore June 30 next year, the fed­eral gov­ern­ment will give you $500. That’s a re­turn of 50%! Top up year after year and your su­per will be pos­i­tively hum­ming.

The gov­ern­ment co-con­tri­bu­tion pays 50¢ for ev­ery $1 of after-tax money you put into your su­per, up to a max­i­mum of $500. Con­trib­ute $500 and you will get $250. If you earn more than $37,697, the ben­e­fit re­duces un­til it cuts out com­pletely at $52,697.

The money for the con­tri­bu­tion doesn’t have to be work re­lated. “The per­son needs to make the con­tri­bu­tion them­selves,” says REST's Dean Bornor. “If par­ents put money in their bank ac­count and if that’s what they choose to do with it, then that’s fine.” En­sure your fund has your tax file num­ber. The gov­ern­ment will pay the co-con­tri­bu­tion au­to­mat­i­cally after you have lodged your tax re­turn.

Bornor urges young work­ers to use the wealth of in­for­ma­tion, fact sheets, in­vest­ment tools and cal­cu­la­tors on their fund’s web­site. More tools can be found at su­per­guru.com.au. They should:

• Un­der­stand the dif­fer­ent in­vest­ment op­tions. • Keep an eye on ex­penses and min­imise fees.

• Re­view insurance – do you need it? “Be­fore you do any­thing, get ed­u­cated. That will give you the ba­sis on which to make de­ci­sions,” says Bornor.

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