Most Australians receive a minimum of 9% of their salary contributed into their super account from their employer. This is known as the Super Guarantee. The Superannuation Guarantee will increase to 9.25% on 1 July 2013 before gradually increasing to 12% by 1 July 2019.
A recent study by ASFA* shows a major shortfall Australians face in retirement if they only rely on their 9% employer super contributions.
A single person needs around $788 and a couple $1,078 a week, for a comfortable retirement. According to ASFA, your current employer super contributions earn you a rather modest lifestyle in retirement. A modest lifestyle allows only $432 a week for a single person.
By adding extra to your super now, you can close the gap to enjoy a more comfortable retirement. A comfortable retirement means being able to afford most things you value now, such as: entertaining family and friends, private health insurance, internet at home, running your car and yes, even those little luxuries like dining out.
You can grow your super in the following ways:
Extra contributions: contribute your own money to super by making regular before- or after-tax contributions, one-off lump sum payments or by contributing to your spouse's super.
Disclaimer: This information is of a general nature. The information does not take into account your investment objectives, financial situation or needs. If you need specific advice for your personal circumstances, you may wish to consult a suitably qualified adviser to ascertain whether the information is appropriate for you.
Closing the gap is easier the earlier you start
The money that's in super the longest works the hardest. So, if you start today, the contributions you need to close the gap will be significantly lower than if you start later in life. You can enjoy life's simple pleasures now and when you finish work. The case study is based on certain assumptions and is provided for illustrative purposes only.
Assumptions: Based on a 30 year old male earning $73,000 pa, retiring at age 65 and contributing to West State Super. Try our How much will I have/need calculator to work out your gap or to view the assumptions. These assumptions may change over time.
Are you making the most of your super?
Making extra contributions to your super now can make a significant difference by the time you retire.