Why should I start to take my Super seriously?
There a many reasons why it’s important to recognise why super is, super. There is the tax efficiency whilst your building your super up, the tax-free benefits later, the incredible benefits of compounding earnings over multiple decades and the financial risk management benefits for your family.
So, when should you start to take super seriously, the answer is now, not all super funds are equal and it is super important that you have the best solution in place for your needs, not just a default.
Regardless of your age or financial position, ignoring your superannuation could result in significant detriment to your lifestyle, opportunities and wellbeing when you reach your preferred retirement age and beyond. By not nurturing your superannuation you may not actually be able to retire or reduce your work hours when you want to. You may have to significantly alter your lifestyle expectations.
That doesn’t sound great. By ignoring your super, you might have a nasty shock in 5,10 or 20 years.
Agile Wealth can help you sort out your superannuation and make it super. You might pay less tax, you will be far more likely to live the lifestyle you want when you retire and best of all, we can set things up for you and keep an eye on it so you don’t have to!
- Your super is likely to be second only to your home in terms of asset value and your primary source of income when you do stop working. Think about the possibility that if your super is not working now, you’re going to have work longer to make up for it.
- Depending on when you started work, your super could be a 70+ year investment. Wow! You could start work in your early 20’s and live into your 90’s. Life needs a source of income and you might be dependent on how well your super went for a third of your life. Superannuation is important.
- The difference over time of 1% or 2% per year in the investment performance of your money can make an enormous difference. Check out the compounding interest calculator on agilewealth.com.au.
As a simple guide, $50,000 in super today with $500 per month savings, compounding at net 5% pa interest for 30 years will equal $614,730. At 6% pa you would have $146,794 more and at 7% pa $332,647 more. The compounding effect is powerful so getting your investments right is really important. (source: https://moneysmart.gov.au/budgeting/compound-interest-calculator). You should check all the fees and ensure you have value for money from your super and investments.
- Risk versus returns. The right balance of investments, risks and consideration for your own personal situation is super important when thinking about your superannuation. Doing nothing and accepting defaults or not actually knowing how much you have or having any idea how or where your money is invested may result in your super not meeting your needs. Considering the importance to your whole life, wouldn’t you rather know where your money is invested and why?
At Agile Wealth we hold investments under scrutiny and assess performance over time using independent research and our investment recommendations are assessed against benchmarks for performance. Whilst we cannot predict the future, we can help you be agile and consciously shift you’r thinking when and how the situation requires it.
- Insurances. It is common to hold insurances inside your superannuation. There are pros and cons to this and checking what insurance you have and why and how much it costs are all critical considerations when assessing your super needs.
- New job, new super. If you have had several jobs, you might have multiple super funds. This could result in multiple fees and no cohesive investment strategy. Speak to us today about consolidating super.
- Tax. Superannuation has a super tax rate of 15% on contributions and earnings. This is lower than any personal tax rates in Australia. Better still, when you are eligible, your pension that is set up from your super monies can be tax free.
- Agile Wealth can help you assess how you are positioned and help you to have peace of mind that your super is set up in the best way for you. Your personal goals and objectives and broader financial life are all balanced so you can live a lifestyle you’re happy with today whilst saving for tomorrow.
Get in touch with us today so we can help you be agile and as a minimum get your super sorted, if not even just a little bit excited about it.
