Putting aside extra money for your retirement mightn’t seem like a priority, especially when there are so many other pressing things to pay for. But even a small amount each week or month could make a significant difference to the amount you’ve got to play with when you retire.
Small amounts can grow a lot over time1. Just an extra $10 a week over 30 years, for example, could grow to around $32,000.
The light blue sections of the graph show the effects of compounding earnings. The dark blue sections show the regular contribution of $20 per fortnight over 30 years.
Saving $20 a fortnight for 30 years
For regular deductions
You can complete a Start or Change Regular Contributions to Your Super form, and nominate the amount you’d like to contribute.
For a one-off deposit
*Cash deposits are limited to $1,000.
If you’ve made non-concessional contributions to your super, you may be able to claim a tax deduction. Those aged 65 to 74 will still need to meet the work test in order to be eligible to make a non-concessional contribution.
Just remember that any employer contributions or salary sacrifice contributions you make also form part of the $25,000 concessional contribution cap1, so factor these in when you’re working out how much of your contributions you want to claim a tax deduction for. If you plan to claim a tax deduction for a super contribution, you must formally notify your super fund in writing before you lodge your annual tax return, start an income stream or transfer your funds.
If you do need financial advice, QSuper members have access to QInvest^, who can offer several advice options and may be able to assist. For other general information, read this case study.
But there are caps on the amount of contributions you can make to superannuation at concessionally taxed rates and no tax deductions can be claimed for personal contributions made to a Defined Benefit account. Find out more about contribution caps.
Just fill in a Notice to the QSuper Board of Trustees form, or complete the declaration and notice included on the Deposit form, which you send with your deposit.
We need to acknowledge a notice for it to be valid, and, once we receive it, the notice can’t be revoked or withdrawn. It may be varied to reduce the amount covered by the notice (which can be nil) before either the time you lodge your income tax return, or the end of the financial year following the year the contribution was made, whichever is earlier.
We’re required to deduct 15% tax from any contributions for which you’re claiming a tax deduction. These contributions may be taxed again when you take the money in cash, as they are concessional (before-tax) contributions. Your contributions and investment earnings must remain in superannuation, generally until you retire after reaching your preservation age, or turn 65, whichever is sooner.
1. Assumptions - The figures above are based on projections in today's dollars, assuming an investment earnings rate of 7% p.a. after fees, tax, and inflation (CPI % movement) of 2.5% p.a. We’ve based the investment earnings rate of 7% p.a. on guidance provided to consumers by the Australian Securities and Investment Commission. This guidance suggests a projected earnings rate of 8.5% p.a. for funds with similar asset allocations to the QSuper Balanced option. An allowance has been made for tax of 6% and QSuper fees [the Accumulation QSuper Balanced option 2008/2009 MER of 0.73% p.a.] and then rounded to give the rate of 7% p.a. The projection assumes contributions are paid at the beginning of each fortnight, and earnings are calculated and paid fortnightly. Actual investment earnings may differ from the projected investment earnings.
You shouldn’t rely on these projections for the purposes of making a decision about a financial product, including a decision about a particular product, fund or strategy. The QSuper Board of Trustees, QSuper Limited and QInvest Limited expressly disclaim all liability and responsibility to anyone who relies, or partially relies on information or projections from the calculator.
2. In years with negative returns, there will be no earnings to reinvest.
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