5 WAYS TO GROW YOUR SUPER AFTER COVID

TAX-DEDUCTIBLE CONTRIBUTIONS

Most Australians can inject up to $25,000 a year into their super and get a tax deduction for it. This money is generally taxed at 15 per cent as it goes into the fund, so higher-income earners benefit the most.

The $25,000 cap includes employer’s contributions. Catch-up contributions are also allowed for many people.

OTHER CONTRIBUTIONS

Cashed-up savers can also add $100,000 a year to their super from their after-tax money. There is no tax deduction for these but also no contributions tax payable.

In many cases two future years of $100,000 contributions can be brought forward too, but seek advice.

PROFIT FROM INCENTIVES

People who qualify for the co-contribution for lower income earners can get up to $500 free from the government added to their super if they put in $1000 themselves each financial year.

Spouses can earn a tax offset worth $540 each year if they put $3000 into a lowincome partner’s superannuation fund.

DON’T FEAR VOLATILITY

Super fund balances will sink if global sharemarkets slide again, but people should see this as buying investments at a discount – because their regular employer contributions will be getting more units for the same outlay.

Super should be seen as an ultra-long term investment, spanning decades, and the higher-growth investments have historically delivered higher rewards.

DIVERSIFY

YOUR SUPER

Holding a range of different investments – from shares to property to cash – has proven to be the best way to achieve solid growth and smooth out the ups and downs of financial markets.

Infrastructure investments in Australia and overseas are an asset class worth considering as governments try to rebuild their economies with big infrastructure spending programs.