November 20, 2023 | 6 min read
Summary: Personal super contributions are a powerful tool for building a secure financial future. By taking control of your super and making voluntary contributions, you can boost your retirement savings, enjoy potential tax benefits, and reduce reliance on government assistance.
In the wide realm of financial planning, superannuation is a term that features prominently in conversations. This is because understanding the intricacies of super and its various facets is key when looking to secure your financial future.
One essential aspect of super that is deserving of your attention is personal super contributions.
While employer contributions form the backbone of most super funds, we also have the opportunity to supercharge our retirement nest egg through personal super contributions.
Here, we'll examine what personal super contributions are, how they work, and why they can be a game-changer for your retirement goals.
The key feature of super is that it operates under a concessional tax system, which means that contributions and investment earnings are taxed at a lower rate compared to regular income. This tax advantage is one of the reasons why super is the primary vehicle for retirement savings in Australia.
Personal super contributions are simply extra contributions that you make to your super fund from your after-tax income. Unlike employer Super Guarantee contributions, which are mandated by law, personal contributions are entirely voluntary. You have the flexibility to choose how much you contribute and when you make these contributions. This flexibility can be a powerful tool in shaping your financial future.
Now that we've established what personal super contributions are, let's explore the benefits they can offer:
Making personal super contributions is a relatively straightforward process, but it's important to follow the correct steps to maximise the benefits. Here's a step-by-step guide on how to get started:
While personal super contributions can significantly benefit your retirement savings, there are some important considerations to keep in mind:
*Based on KPMG Super Insights 2023 Report as at May 2023 KPMG Super Insights 2023 Report
As one of the largest super providers in Australia,* we’re focused on delivering competitive returns, so your money continues to grow. When it comes to support, we go the extra mile— providing general super advice at no additional cost.
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This article has been prepared by NULIS Nominees (Australia) Limited ABN 80 008 515 633 AFSL 236465 (NULIS) as trustee of the MLC Super Fund ABN 70 732 426 024. NULIS is part of the Insignia Financial group of companies comprising Insignia Financial Ltd ABN 49 100 103 722 and its related bodies corporate (‘Insignia Financial Group’). The information in this article is current as at November 2023 and may be subject to change. This information may constitute general advice. The information in this article is general in nature and does not take into account your personal objectives, financial situation or needs. You should consider obtaining independent advice before making any financial decisions based on this information. It is recommended that you consider the relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) before you make any decisions about your superannuation. You can obtain the latest copy of the PDS (or other disclosure documents) and TMD by calling us on 132 652 or by searching for the applicable product at mlc.com.au. You should not rely on this article to determine your personal tax obligations. Please consult a registered tax agent for this purpose. Opinions constitute our judgement at the time of issue. The case study examples (if any) provided in this article have been included for illustrative purposes only and should not be relied upon for decision making. Subject to terms implied by law and which cannot be excluded, neither NULIS nor any member of the Insignia Financial Group accept responsibility for any loss or liability incurred by you in respect of any error, omission or misrepresentation in the information in this communication.