Five ways to save more super

While it is impossible to control investment markets, there are many other ways Australians can ensure that they are saving as much super as possible for their retirement.

Here are five ways to save more super:

• Provide your super fund with your TFN

Providing your tax file number (TFN) to your super fund ensures that employer super contributions and concessional contributions are not taxed at 49 per cent instead of 15 per cent. Making sure that your super fund has your TFN is also essential for those who want to make non-concessional contributions. Without a TFN, you cannot make non-concessional (after-tax) contributions.

• Combine super accounts to reduce fees

The administration fees of super accounts are usually charged at a flat rate per super account. However, many people may be paying much more than this depending on how many super accounts they have. Some super funds also deduct life insurance premiums automatically, which means some people can be losing a lot of money unnecessarily if they hold more than one super account.

• Ensure your employer is making the correct SG contributions

Employers must make superannuation contributions on an employee’s behalf when the employee earns at least $450 each month. The superannuation guarantee (SG) is currently the equivalent of 9.5 per cent of what an employee earns. Employers must pay super contributions at least quarterly into an employee’s chosen super fund. The SG rate will remain at 9.5 per cent until June 2021.

• Monitor and review your investment options

Regularly monitoring a fund’s investment returns against the returns of other super funds can help determine if an individual’s current super fund is delivering enough to achieve retirement goals, or whether the investment option is the most appropriate option.

• Nominate your beneficiaries

Individuals can leave their superannuation benefits to anyone who is considered a dependant under the superannuation laws. Alternatively, individuals can also leave their super to their estate and then pay the super to anyone as part of the estate. However, some dependants will receive tax-free death benefits while others will have to pay tax on those death benefits. Spouses, children and financially dependent adult children are considered dependants under both the super laws and tax laws, and therefore receive tax-free death benefits. Financially independent children are dependants under super laws but treated as non-dependants under tax laws, and may pay tax on super death benefits.