superannuation fund Archives

Your super: A scammer’s new target

29 July, 202431 July, 2024 Updated on31 July, 2024 Education, Superannuation

In a recent media release, the Australian Securities and Investments Commission (ASIC) warned about a new scam doing the rounds. Scammers attempt, through cold calls to superannuation savers, to extract personal and super fund details by offering incentives in the form of gift cards, competitions or mobile phones. Some induce victims to create an account on their ‘comparison website’ to legitimise themselves and their advice. Rosie’s story: When you get those phone calls in the evening, you know, around dinner time, you’re immediately suspicious. But Steve rang mid-morning saying he represented a well-known investment firm. He said that his area of expertise was superannuation, and that it would only take a moment for him to explain what he could do for me. He then guided me through the steps for creating an account on his website. Naturally, I was cautious, but Steve reassured me it was just a comparison site, and I wasn’t signing up to anything. He showed me how to compare my super fund’s returns with others, and the website seemed so legit that I felt a bit silly for initially having doubts. I listened to what he had to say, and it all made sense. Gerry’s story: The first I knew about all this was when Rosie called asking me to transfer her super into an alternative fund. A bit of background; Rosie has been a client since we first set up a retirement plan and savings strategy for her, twenty-odd years ago. As her lifestyle changed over time, we reviewed and tweaked her portfolio, and she was on track for a comfortable, self-funded retirement. Rosie is an intelligent woman. She may not be a superannuation expert – that’s my job – but we’ve had some quite detailed conversations about her retirement and savings portfolios. So when she asked me to facilitate her roll-over to this other fund, well, to say I was concerned was an understatement. Scammers pose as financial planners or investment managers. Traditionally, they have targeted individuals searching online using words like, ‘safe’, ‘superannuation or ‘long-term’. Recently, they’ve gone to the next level and begun cold calling. Rosie: When I phoned Gerry, he seemed reluctant to organise my roll-over. He asked me for the details of the fund I was rolling into and said he’d get back to me. I thought he was just a bit miffed that I was talking to someone else. Gerry: Alarm bells were going off in my head. I asked Rosie to sit tight for a day while I researched the fund. I contacted the company this Steve fellow claimed to represent and asked them a few questions. Of course, neither Steve nor the fund existed. Then I checked whether the fund had a USI (unique superannuation identifier). Nothing for that either. I rang Rosie. Rosie: I was shocked, I mean, Steve sounded so genuine – and the website! Wow. What a close call! Gerry told me to report the scam to Scamwatch. They contacted me and said this kind of thing was increasingly common and recommended I join the ‘Do-not-call register’. Lesson learned. I’ve had a great working relationship with Gerry for years, there’s a reason for that! I’m due for my annual review next month – Coffee’s on me! If you suspect a scammer has called you, ASIC recommends you: Above all, never accept financial advice from someone you don’t know, if in doubt, speak to your financial adviser – seriously, if the fund is legitimate, they’ll know about it! The information provided in this article is general in nature only and does not constitute personal financial advice. 

Pay attention to super in your 30s

24 February, 202117 September, 2021 Updated on17 September, 2021 Education, Superannuation

If you are in your 30s, chances are life revolves around children and a mortgage – not super. And as much as we love our kids, the fact is they cost quite a lot. As for the mortgage, this is the age during which repayments are generally at their highest, relative to income. And on top of that, one parent is often not working, or working only part time. Even if children aren’t a factor, career building is paramount during this decade. Don’t be alarmed, but by the time a 35-year-old couple today reaches retirement age in 32 years’ time, the effects of inflation could mean that they will need an income of about $150,000 per year to enjoy a ‘comfortable’ retirement. To support that level of income for up to 30 years in retirement they will want to have built a combined nest egg of about $2.7 million! If you are on a 30% or higher marginal tax rate, willing to stash some cash for the long term, and would like to reduce your tax bill, then consider making salary sacrifice (pre-tax) contributions to super. For most people super contributions and earnings are taxed at 15%, so savings will grow faster in super than outside it. Even if you can’t make additional contributions right now there is one thing you can do to help achieve a comfortable retirement: ensure your super is invested in an appropriate portfolio. With decades to go until retirement, a portfolio with a higher proportion of shares, property and other growth assets is likely to out-perform one that is dominated by cash and fixed interest investments. But be mindful: the higher the return, the higher the associated risk. For any young family, financial protection is crucial. The loss of or disablement of either parent would be disastrous. In most cases both parents should be covered by life and disability insurance. If this insurance is taken out through your superannuation fund the premiums are paid out of your accumulated super balance. While this means that your ultimate retirement benefit will be a bit less than if you took out insurance directly, it doesn’t impact on the current family budget. However, don’t just accept the amount of cover that many funds automatically provide. It may not be adequate for your needs. Whether it’s super, insurance, establishing investments or building your career, there’s a lot to think about when you’re thirty-something. It’s an ideal age to start some serious financial planning, so contact us today about putting a plan into place. The information provided in this article is general in nature only and does not constitute personal financial advice.

Super in your 20s: Boring? Doesn’t have to be!

10 February, 202117 September, 2021 Updated on17 September, 2021 Education, Superannuation

Superannuation is for the oldies, right? In some ways that’s true, but even in your twenties there are good reasons to take a bit more interest in your super. The average 25-year-old has around $10,000 in super, but the decisions you make now, even with relatively small sums of money, could earn you hundreds of thousands of extra dollars over your working life. Are you getting any? Earn more than $450 in any given month? Then every three months your employer should be paying 9.5% of that into your super fund. Usually you can choose your fund; if you don’t, it gets paid into a super fund of your employer’s choice. If you don’t know if your super is being paid, or the fund it’s being paid into, ask your employer. If you think you’re missing out, search ‘unpaid super’ on the tax office website (ato.gov.au) to see what you can do. This is your money. Where have you got it? Had more than one job? If you have a lot of little super accounts the money can disappear in a puff of fees and insurance premiums. Simple fix – combine your super into one account. Is it working for YOU? Your money is going to be stuck in super for a long time, so you want it to be working hard for you. Most funds offer a range of investment choices and some will do better than others. What do you want? Buying a new car. Travelling, Having fun. Let’s face it, there are lots more exciting things to do with your money than sticking it into super. The choice is yours but think about this: If Mum and Dad retired this year, they would need a minimum of around $61,909 per year to enjoy themselves. If that doesn’t sound like much now, by the time YOU retire inflation could have pushed that annual amount to around $214,248. That means you will need to have at least $3.71 million in savings! Sure you’ve got 40-plus years but that’s still a lot of money to save up! It can be done if you start early enough – and you don’t need to miss out on enjoying life now. Starting early and adding a bit extra when you can makes a big difference. Let’s work on another 40 years before you can retire. If you start now by making an extra post-tax contribution of just 1% of your annual income to super, ($350 from a $35,000 salary – and the government could add to that with a co-contribution) at an 8% investment return could add an extra $149,000 to your retirement fund. If you wait 20 years before starting to make that extra contribution, you’ll only get a boost of $49,000. $100,000 less! Continuing this small extra contribution as your salary increases will turbo boost your super fund balance. Imagine your retirement party?! So, still find super boring? That’s okay; you’re not alone. But instead of finding the time to organise all this yourself, contact us today and we will review your current super, any insurance required, the investment choices and prepare a strategy to get your super into shape – then you can get back to enjoying life! The information provided in this article is general in nature only and does not constitute personal financial advice.

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