Superannuation changes are afoot, and time is running out this financial year to take action. Here’s what you need to know about your superannuation account ahead of the EOFY deadline.
The end-of-financial year is a hectic time for most people.
But it’s important you take some time out in the lead up to the new financial year to review your superannuation account.
Here are three quick tips regarding superannuation accounts before July 1 rolls around.
1. “This is very serious and there will be tears” Life and disability insurances could lapse
From July 1, more than three million Australians may be affected when default insurance is switched off within superannuation accounts that have been inactive for 16 months.
So if you’ve taken a break from the workforce, for example, you could find yourself without cover.
People with low balances in lost super accounts (those containing less than $6,000) will also be affected as the accounts will be transferred to the ATO.
The changes have been introduced to help reduce the erosion of account balances by the additional fees and insurances that come with inadvertently holding multiple super accounts.
However, alarmingly, less than half the population even knows that this change is about to take place.
So if you, or someone you know, are concerned that insurances might be cancelled, contact the relevant superannuation fund.
Alternatively, come and pay us a visit and we can see if a life insurance option outside your superannuation fund is more suitable for your family’s needs.
2. Boost your partner’s superannuation
If your spouse is a low-income earner, you can make a $3,000 after-tax contribution to their super fund and receive a tax rebate of up to $540.
Now even though this might not apply to your situation, you might want to let your children and other loved ones know – or put them in touch with us.
Just remember not to leave the co-contribution to the very last minute – the payment needs time to clear to ensure it is received before the EOFY.
3. Boost your own superannuation
If you’re a low or middle-income earner, you can make an after-tax contribution of $1000 into your own super fund before the EOFY and the government will co-contribute up to $500.
Once again, if this co-contribution isn’t applicable to you, it might be for someone else you know who isn’t earning as much and would like to give their super fund a bit of a boost.
Just be sure to give them warning ahead of June 30.
Get in touch
If you’d like to find out more about any of the above changes or opportunities, then please get in touch.
We’d be more than happy to run through your financial situation with you to ensure you’re making the most of your superannuation accounts.
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