Superannuation is an investment structure that enjoys special taxation treatment to encourage people to provide for their retirement. Most investments held by an individual, whether they are Cash, Fixed Interest, Property, or Shares, can also be held through the superannuation structure.
The advantage of Superannuation is that investment earnings are taxed at a maximum of 15%, compared to investments held in your personal name which can be taxed at up to 46.5% (including Medicare levy). In addition, if you convert your superannuation into a retirement income stream this tax reduces to 0% at age 60.
Retirement planning is better started sooner than later, however there are strategies such as Transition to Retirement (TTR) that can be used from preservation age (currently 56) that can have a huge benefit to your retirement savings.
Transition to Retirement is a Tax effective strategy that involves salary sacrificing into superannuation, and drawing an income stream from existing superannuation funds. It can result in same take home pay, less tax and increased retirement savings.Information on this site may be regarded as general advice. That is, your personal objectives, needs or financial situations were not taken into account when preparing this information. Accordingly, you should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs before acting on it. Where the information relates to a particular financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product.