T

Western Suburbs Weekly - - Money Talks -

HINK of your su­per ac­count as a grow­ing plant. It just makes sense that the more you feed and wa­ter it, the big­ger and stronger it will grow.

That is par­tic­u­larly the case when it comes to a ma­jor life change such as mov­ing from full-time to part-time work or even start­ing part-time work again af­ter you have re­tired.

If you are over 18 and earn more than $450 a month, your em­ployer must pay su­per­an­nu­a­tion for you at a rate of 9.5 per cent of your or­di­nary time earn­ings.

If you are down­grad­ing from full- to part­time work, that will prob­a­bly mean that your su­per con­tri­bu­tions will re­duce but they can be held steady through strate­gies such as salary sac­ri­fice and even af­ter tax con­tri­bu­tions.

An­other op­tion as you get older is to take ad­van­tage of tran­si­tion to re­tire­ment ar­range­ments. In this sit­u­a­tion, a re­tire­ment in­come ac­count is opened along­side your reg­u­lar su­per ac­count. Th­ese two ac­counts work to­gether and may re­duce the over­all tax you pay while help­ing grow your su­per sav­ings.

Since you're still work­ing, your su­per ac­count con­tin­ues to re­ceive con­tri­bu­tions.

At the same time you'll re­ceive reg­u­lar payments from your re­tire­ment in­come ac­count, paid di­rectly to your bank ac­count.

You can use this strat­egy to ei­ther work less or save more.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.