Super industry knows best, 10 super tips for healthy retirement, accessing super early, salary sacrifice loophole, contribution survival guides.
Welcome to the bumper December 2009 edition of SuperGuide newsletter, a free and independent source of superannuation information for consumers.
This is the final edition for 2009, and our 10th edition since we started the newsletter in March 2009. We’re still a young website, heading towards our first birthday in January 2010, but the support and interest in SuperGuide from readers, and even individuals within the superannuation industry, has exceeded our expectations. Our readership is growing rapidly, and we can credit visitors to our site from 82 countries! Many thanks for your support and interest in SuperGuide.
On behalf of our very small but energetic team, I wish you a safe and enjoyable holiday season.
Here’s the highlights of this month’s SuperGuide newsletter:
- THE SOAPBOX: LET’S TALK ABOUT CONSUMERS, BUT DON’T INVITE THEM TO THE TABLE. I have always held a strong belief that Australians want to find out more about super, if the information is presented in a way that works for them rather than the super industry. The Super System Review should take heed, and not assume that the majority of Australians want a system where the super industry purports to be the benevolent overseer for consumer interests. The continuing existence of commissions, multiple super funds and paper-based processing is evidence enough that the super system cannot be driven only by those with vested interests. For more, click on the THE SOAPBOX link below.
- 2010 CHECKLIST: 10 SUPER TIPS FOR A FINANCIALLY HEALTHY RETIREMENT. You can add thousands of dollars to your super account by spending a little bit of time over the Summer getting to know your super benefits. In this article, I take you through 10 practical and no-cost ways to build a healthy retirement balance. Click on the link below to find out more.
- ACCESSING SUPER EARLY: 12 POPULAR Q AND As. Due to popular demand, particularly from our overseas readers, we have beefed up our ‘Accessing super early’ information. Click on the link below to access this article.
- SG: BEWARE THE SALARY SACRIFICE LOOPHOLE. This unfair, outdated loophole means Australian employees are losing super money every year because successive Australian governments don’t care enough to change the super rules. Click on the link below to find out more.
- CONTRIBUTION SURVIVAL GUIDES. If you haven’t already, don’t forget to check out our contribution survival guides (three plain-English summaries of the contribution rules). If you make additional contributions to your super fund, then you need to be mindful of the contributions caps. This is particularly important if you are making concessional (before-tax) contributions – the concessional cap has been halved from July 2009.
In this month’s newsletter, you also can read about Australian super funds set to deliver double-digit returns for 2009, what the Super System Review is all about, APRA suspending the trustee of 4 super funds, heaps of Q and As from readers and more, by clicking on the links below.
SUMMER EMAILS: Although, we won’t be sending out a January newsletter, we may be sending out irregular emails to subscribers when any significant super news arises over the Summer. Also, I am trying to catch up on the many questions that I have received over the year. We receive hundreds of emails from readers and the questions that readers ask help me to choose topics for the website. Even though I may not answer all questions (we do acknowledge all emails, and I read every email), this invaluable interaction with readers has enabled us to develop a unique free information resource. Thanks again.
If you like this newsletter and our website, then please pass on the newsletter to your friends and encourage them to sign up for SuperGuide newsletter. As consumers, we have more influence with decision-makers when we speak as a group.
Trish Power
THE SOAPBOX: Let’s talk about consumers, but not invite them to the table
If you’re confused about what is happening with the Super System Review, then you’re not alone. Over the past few months, I have chatted with many Australians who are reading in the newspapers about phases, issues papers and preliminary reports and not sure what fits where in the Super System Review (SSR), and whether they should read any of it, or simply wait, for when all the noise stops.
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FEATURES
2010 checklist: 10 super tips for a financially healthy retirement
Here’s a suggestion: use this list as a kick-start for your super New Year resolutions. You may not keep all of your resolutions, but if you do just a handful of the tasks listed in the checklist below, you can strengthen the chances of a financially secure retirement.
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Super funds set to celebrate double-digit returns for the 2009 calendar year
Rating company, SuperRatings, expects the balanced options of Australia’s major super funds to deliver an investment return after fees and taxes of between 10% and 12% for the 2009 calendar year. More on this later. Before I expand on this prediction, I want to explain how the reporting of fund returns works, and what it means for your account balance.
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What the heck is the Super System Review?
By 30 June 2010, a Government-appointed panel will finalise its review of Australia’s superannuation system – warts and all! Before the Review panel delivers this report however, there’s a lot of work to be done. The panel, appointed in May 2009 (and two extra panel members appointed in August 2009), is overseeing the ‘Review into the governance, efficiency, structure and operation of Australia’s superannuation system’.
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Warning: ASIC suspends trustee of 4 super funds
If you’re a member of one of the super funds listed below, then you need to read this article; Astarra Superannuation Plan; Astarra Personal Pension Plan; My Retirement Plan, including subplans – Seagrims Retirement Plan, TIC Super, and Titanium Retirement Fund; Employers Federation of NSW Superannuation Plan.
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Living to a ‘very old age’: a note from the Australian Government Actuary’s office
In November 2009, I wrote an article, (Updated life tables: Is the tide shifting for Australian life expectancies?), reporting that average life expectancies have increased, except for women in their eighties and nineties, based on the latest life tables released by the Australian Government Actuary.
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HOW SUPER WORKs
Accessing super early: 12 popular Q and As
A popular article on the SuperGuide website, particularly for our overseas readers, is 12 legal ways to access your super. I have received many questions from readers, some in serious financial situations or suffering illness who are seeking more information on how to access Australian super benefits early.
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Beware the salary sacrifice loophole
Q: Before commencement of salary sacrifice, my financial adviser told me to ask my boss if he would agree to pay the 9% on the full salary because, legally the employer only needs to contribute the 9% on the income I receive after the salary sacrifice. In short, my gross salary is $850 per week and I sacrifice $450 per week; from the other $400 he deducts the tax and I take home $341 net.
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Save tax: supply TFN to your super fund
Here’s a tip that can potentially save you thousands of dollars. Check that your super fund has your tax file number (TFN). If you joined a super fund before July 2007, or started your current job before July 2007, then your fund may not have your TFN.
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Cut fees: combine super accounts
If you have more than one super account then you are paying more than one set of fees on your retirement savings. By combining super accounts you can save tens of thousands of dollars in fees over your working life.
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DIY SUPER
Shining a Government spotlight on SMSFs: a summary
On 10 December 2009, the Government’s Super System Review released ‘A statistical summary of self-managed superannuation funds’. Although mainly based on data as at June 2008, the document provides interesting insights into what the ‘average’ SMSF is doing in terms of fund costs, asset allocation and investment performance.
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SMSF providers: What should I look for when setting up my DIY super fund?
I am about to set-up my SMSF but I am not sure who to handle this for me. Some online providers are reasonably priced but I am concerned about access and professionalism as they are online only. I have checked out various other providers (but unsure who to go with).
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Concessional contributions: what form do I use to claim a tax deduction?
Q: Could you lead me to a link where I could find a generic S290-170 notice of intent to deduct? It would be great to have a generic list of forms that would assist self-managed super fund (SMSF) trustees.
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Q and As
Working longer reaps tax benefits for over-55s
Q: My parents are 70 years old and still working. Can they get the Mature Age Worker Tax Offset (MAWTO), and the Senior Australians Tax Offset (SATO)?
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SATO: Cutting seniors tax via super contributions no longer possible
Q: I am attempting to work out when the 30% tax rate applies to both my wife and my own incomes for 2009/10 year. We are both 67 and operate a SMSF to which we can make concessional contributions, and I would like to reduce personal income to the point below which 30% tax rate applies.
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Super for beginners, part 5: Is super my money or the Government’s money?
Q: I never understood the term ‘superannuation’. Is that our money or government money? If it is our money why can’t we do whatever we want with it. Isn’t it illegal to cut our rights when it comes to this matter?
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Super for beginners, part 6: Can I make concessional (before-tax) contributions while I’m unemployed?
Q: I have been made redundant and would like to know if any contribution in super is tax deductible while I’m unemployed even if I would find work in the next couple of weeks?
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Hi - I'm Trish Power, author of 
