One simple thing
The tradition of setting resolutions around New Year’s is as old as, well, the Babylonians. Apparently they made promises to their gods at the start of each year that they would return anything borrowed and pay off their debts.
So it’s no wonder that around this time of year we pause to reflect on what was and plan for a new beginning by making our New Year’s resolutions. Interestingly, according to Harvard Business School social psychologist, Amy Cuddy, this can actually do more harm than good. Why? We set unreasonable goals that can actually de-motivate us.
Because super is an area that really (REALLY!) impacts your future prospects, we thought we’d help out by coming up with a list of six simple things that you can do to make a difference to your financial wellbeing.
|Pick any ONE of these and chances are high that you’ll be better off in 2016 than you were in 2015. And we’ll do all – or most – of the heavy lifting.|
In one simple conversation, covering a few key super settings, you could add tens of thousands – or even hundreds of thousands – to your future lifestyle. And because this service is included in your membership it won’t cost you a cent.
It’s a no brainer.
Request a telephone appointment using the form below, or give us a call us on 1300 65 18 65 and ask to speak to one of our member solutions advisers*.
Pick any one of these and act now:
As your life changes – so should your investment profile
Statewide has 10 different investment options to cater for differing goals and risk appetite – and you can mix and match different options. And, the outcomes can be vastly different. For example, $50,000 invested over 30 years (with no additional contributions) in Statewide’s Conservative option could grow to around $80,000, while if it were invested in our High Growth option it could grow to over $220,000.†
Set yourself up to receive a $500 extra super contribution from the government
If you earn less than $50,454, you may be eligible to receive up to $500 from the government, through their super co-contribution scheme. In a nutshell, the government will give you 50c for every $1 in after-tax contributions you make up to the limit.
And, an extra $1500 in your account each year (the maximum contribution plus government co-contribution), over 30 years, with 4% in returns, could add an extra $85,000 odd to your account.
You can make after-tax contributions by direct debit or BPay®, and regular payments – for example, $10 a week – may be a lot more manageable than $500 all in one go.
If you want start contributing to receive the maximum co-contribution for the 2015–16 year, you’ll need to set up a payment of around $20 a week between now and June.
The co-contribution works on a sliding scale, depending on your contributions and income. The table below shows co-contribution amounts for the 2015–16 financial year.
|Your personal contribution|
|Your total income||The contribution you are eligible for is:|
|$50,454 or more||$0||$0||$0||$0|
Stop wasting thousands on duplicate fees – consolidate your super
According to the ATO, over six million Australians have more than one super account. And, as of June 2015 there were over six million ‘lost’ super accounts, totalling more than $16 billion in unclaimed funds.
Is this you? Do you have a good reason (like insurance entitlements or existing defined benefit entitlements), or have you just never gotten around to sorting it?
If you have extra super accounts you don’t need, it’s likely that you’re paying unnecessary administration fees, plus fees for multiple insurance benefits (which may not even be adequate for your needs) – eroding your savings.
For example, say you have two extra super accounts, and you’re paying an additional $200 in fixed fees for each per year – a total of $400 in unnecessary fees each year. Over 30 years, with 4% interest this could add up to an extra $22,000 in your account – or not.
So – having your super in one low-fee, high return, easy to keep track of account makes good financial sense.
Chip in a little extra
Although we’re lucky to live in a country with a robust retirement safety net, and a mandated 9.5% employer contribution, the sad fact is that for many Australians, it’s not enough to ensure a comfortable retirement.
Chipping in extra to your super is a great way to give your nest egg a boost. You can take advantage of the power of compounding returns, and reap the returns of the tax-advantaged environment – especially if your employer lets you make salary sacrifice contributions from your super.
For example, an extra $20 a week invested with a 4% return could equal an additional $60,000 after 30 years (around $29k of which is interest).
Check that your life insurance is adequate
Underinsurance is a major problem in Australia.
According to a recent report by KPMG, 35% of employed Australians don’t have any disability insurance at all, and the average Australian has only 55% of what’s considered an ‘adequate’ level of disablement insurance.
As a Statewide member, chances are you probably have insurance within your super. Our employer-sponsored members automatically receive life insurance, total and permanent disablement insurance, and income protection insurance upon joining.
But, the automatic cover provided is group insurance – that is one-size fits all. Clearly it makes sense to ensure that your level of cover is right for you, so you’re not paying for cover that you don’t need, or, if the worst happens, find that your level of cover is insufficient for your needs.
And – if you have multiple super funds, you might well be paying for multiple sets of insurance that you may not be able to claim on. So it makes sense to review your insurance and make sure it’s working for you.
Make sure you control who your super goes to
No one likes to think about death, but leaving clear instructions can make it easier for those you care about.
Nearly half of all Australians die without a will, and unless you specify your beneficiary, Statewide’s trustee will decide who receives your super.
There are two ways of nominating who you want your super to go to: binding beneficiary nominations and preferred beneficiary nominations.
A valid binding beneficiary nomination must be followed by the trustee, and must be renewed every three years. You can leave your super to your spouse or dependants, or you can specify for your super to be paid to your legal personal representative (the executor of your will).
Preferred beneficiary nominations allow you to specify who you’d like to receive your super – but the final decision is still up to the trustee. These nominations don’t need to be updated.
We can help you set up a new nomination, or change an existing nomination, so you can have peace of mind about your super.
Fill in your details below to make an appointment with one of our member solutions advisers. It’s one easy New Year’s task that could make a big difference over a lifetime.
Notes: Projected returns are rounded to the nearest $5000. Except where specified, calculations are based on a 4% return, which is the target above CPI of our default MySuper investment option. Investment returns are not guaranteed, all investments have risk, and past performance is not an indicator of future performance.
The information provided is of a general nature. It does not consider your specific needs nor is it intended to be financial product advice. You should obtain independent financial advice and consider the applicable product disclosure statement before making an investment decision.
*Financial information and general advice may be provided by representatives of the fund’s administrator and wholly owned company, Statewide Financial Management Services Limited, ABN 69 092 109 209 Australian Financial Services Licence No. 239063. Any personal advice you receive is provided by Authorised Representatives of Industry Fund Services Limited (IFS) ABN 54 007 016 195, AFSL No 232514. IFS is responsible for the advice given to you by its Authorised Representatives and fees apply to any personal advice provided.
†Based upon the investment objectives of the Conservative option to achieve returns after tax and fees that exceed the Consumer Price Index by 1.5% over a rolling five-year period and the High Growth option to exceed the Consumer Price Index by 5% over a rolling seven-year period. Investment returns are not guaranteed, all investments have risk, and past performance is not an indicator of future performance.