Superannuation – don’t set and forget
The government regularly reminds us that each Australian must take responsibility for funding their future.
Regardless of when you will be able to access your super, or when you choose to stop working, you need to be aware of how your superannuation is being managed and if the final balance will be sufficient when you’re ready to retire... and for the years beyond.
As a super fund member it is your responsibility to manage your contributions – over and above your employer’s contribution – regardless of whether they are being invested into a retail fund, corporate fund or your own self-managed super fund.
Superannuation is simply another investment vehicle, but it should still be treated like a valuable financial asset.
The fundamental principles of financial planning prescribe that individual tailoring, based on your needs, objectives and personal circumstances, is paramount to ensuring you have enough money to enjoy your retirement years.
It’s a recipe for disaster to think that once you have established a superannuation account and your employer’s contributions are flowing in, you can forget about it for the rest of your working life.
Financial markets will change, your own financial position will change, and your objectives and retirement plans might change, so it’s crucial that you review your super regularly.
Needs are different
Additionally, it’s foolish to believe that a ‘one size fits all’ approach with no personal advice on contribution levels or transfer issues will help you achieve your goals.
The amount of money in your super fund when you retire will determine what type of retirement you will enjoy.
So, it is you who must take responsibility for determining what your needs are and work towards meeting them.
That could mean making increased contributions after a certain age to bolster your retirement savings or deciding whom your beneficiaries will be if you don’t make it that far.
Super tax
Did you know that you might attract tax penalties by making large contributions to superannuation?
Don’t panic; this is something your financial adviser can help you manage so you can still meet your accumulation strategy.
These are critical issues that you should take the time to discuss with your financial adviser. Superannuation is your investment in your future. Individual advice and tailoring is essential.