Tipping an extra $50 per month into your superannuation fund can leave you with nearly $50,000 extra at retirement, new figures show.
Australians are being encouraged to skip sipping on daily takeaway coffees and buying their lunch as just a few ways to creating extra cash flow they can stash into their super savings and help fatten their balance.
New figures by the Association of Superannuation Funds of Australia has revealed if a 20-year-old tipped in an extra $50 per month into their retirement kitty their super balance would grow by an additional $49,800 once they reach 67.
And for a 50-year-old this would mean adding an extra $11,300 to their retirement stash.
The Association of Superannuation Funds of Australia’s chief executive officer, Dr Martin Fahy, said it’s critical Australians throw in a little bit extra to their super account on top of compulsory contributions so they can end up with a significantly larger balance once they stop working.
“Time is your friend and compounding interest is a miracle so if you start early you will benefit,’’ he said.
“For every year you put in something extra it’s protecting you from those years when you can’t put in something extra, for instance taking parental leave or time out of the workforce with some disruption to your contributions.”
Many Australians take time out of the workforce to have a baby, raise children, care for parents or some are forced to stop work because of injury or illness, which can result in a halt to super contributions.
Financial Planner, Paul Dobbrick said even for lower-income earners, it’s worth checking if you are eligible to receive money from the government to help bolster your super balance.
“Low-to-middle income earners may also be eligible for an extra super contribution from the government who will add an extra 50 cents to every after-tax dollar you contribute up to $1000,’’ he said.
“That’s up to $500 extra into your super each year, which could add up to thousands by the time you retire.”
ASFA’s figures show for people to achieve a comfortable retirement, singles need $545,000 in superannuation and couples require $640,000 by age 67, while also owning their home outright and having good health.
For some advice on how to improve your retirement planning, contact us today… we’ll even shout you a coffee!
General Advice Warning
Past performance is not an indicator of future performance. The information provided in this article is general in nature and does not take into account your particular investment objectives, financial situation or insurance needs; we therefore recommend you seek advice tailored to your individual circumstances before making any specific decisions.
Dobbrick Financial Services (Gympie) Pty Ltd ABN 48 931 205 109 & DFS Oakland ABN 64 340 527 395 and their advisers are authorised representatives of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306 Australian Credit Licence. Dan Robertson is a Credit Representative of Fortnum Financial Advisers, Credit Representative Number: 367697.
