Ex­tra pay­ment caps a real su­per pooper


THE amount of vol­un­tary su­per­an­nu­a­tion con­tri­bu­tions has dras­ti­cally fallen un­der new changes re­strict­ing how much Aussies can tip in.

New anal­y­sis by su­per re­search house Su­per Rat­ings found in the 2017-18 fi­nan­cial year vol­un­tary con­tri­bu­tions fell to $19.8 bil­lion – a drop of 35 per cent on the pre­vi­ous year.

In the 2016-17 fi­nan­cial year, Aus­tralians con­trib­uted a mas­sive $30.4 bil­lion ex­tra into their su­per ac­counts ahead of the caps be­ing in­tro­duced.

This was a fall from $2751 per ac­tive su­per mem­ber in 2016-17 to just $2225 to 2017-18.

Ma­jor pol­icy changes in­cluded con­ces­sional con­tri­bu­tion caps be­ing wound back to $25,000 in the last fi­nan­cial year, which made it less en­tic­ing for Aus­tralians to proac­tively bol­ster their su­per.

The cap had been $30,000 for those un­der 50 and $35,000 for those over that age.

These amounts in­clude com­pul­sory su­per­an­nu­a­tion pay­ments made by a worker’s em­ployer.

Aus­tralian In­sti­tute of Su­per­an­nu­a­tion Trustees chief ex­ec­u­tive of­fi­cer Eva Scheer­linck said while there had been many changes to how much ex­tra peo­ple could tip in it didn’t have to be a de­ter­rent.

“The best way to op­ti­mise your re­tire­ment sav­ings is to make vol­un­tary con­tri­bu­tions when you can and par­tic­u­larly when you are young,” she said.

“Jan­uary is a great time to start mak­ing ex­tra vol­un­tary con­tri­bu­tions.”

Su­per will re­main a hot topic ahead of the up­com­ing fed­eral elec­tion. Last week, the Pro­duc­tiv­ity Com­mis­sion re­leased a re­port into ways to dras­ti­cally over­haul su­per.

This in­cluded a new plan to al­lo­cate de­fault su­per prod­ucts, list­ing the 10 best funds and de­lay­ing an in­crease to time­line for the 12 per cent su­per guar­an­tee.

New Aus­tralian Su­per fig­ures found in 2018 their mem­bers’ vol­un­tary con­tri­bu­tions fell to $2.3 bil­lion, down from $2.9 bil­lion in 2017.

But sur­pris­ingly the num­ber of peo­ple tip­ping more rose from 159,000 in 2017 to 183,600 in 2018.

The fund’s group ex­ec­u­tive of prod­uct, brand and rep­u­ta­tion, Paul Schroder, said tip­ping in ex­tra from a young age could make a huge dif­fer­ence.

“A 25-year-old putting an ex­tra $50 a month into their su­per – just $600 a year – will have $175,000 ex­tra by age 65,” he said. “A 35-year-old do­ing the same will have an ex­tra $79,000, and a 45-year-old will have an ex­tra $32,000.”

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