Super Booster Day is back for 2017.
With fewer than 5% of Australians under 45 putting extra money into super and many couples facing a shortfall of $25,000 a year in retirement, Money has teamed up with the Association of Superannuation Funds of Australia (ASFA) to bring back the superannuation initiative.
The campaign kicks off on July 4, culminating in Super Booster Day on September 15.
Money magazine editor Effie Zahos says she has always been a strong supporter of topping up super, which comes with tax benefits.
“You can enjoy tax savings if you top up your super using your pre-tax income,” she says.
“These contributions are generally taxed in the super fund at a maximum rate of 15%.
“In most cases, this tax rate is less than the marginal tax rate. If you can’t make regular payments, a one-off after-tax contribution can help you supercharge your wealth.”
Most Australians will now be able to claim a tax deduction for a personal contribution to super without needing to set up a salary sacrifice arrangement with their employer, after changes introduced on July 1.
According to ASFA’s Retirement Standard, single people need $545,000 in retirement savings and couples need $640,000 to have a comfortable lifestyle.
Fewer than 20% of singles and 30% of couples aged over 65 can achieve this at retirement.
A 40-year-old Australian with $50,000 in super, earning $70,000 a year and only relying on the Superannuation Guarantee made their employer, will have just $388,000 in super by the age of 67. That is about $150,000 less than they will need to lead a comfortable lifestyle.
The average super balance at retirement is $292,500 for men and $138,150 for women – a big gap from the current ASFA ‘comfortable’ level.
ASFA CEO Dr Martin Fahy said Australians should invest in their super to reap the rewards of compound interest.
“It’s particularly important for young people and women to engage early with super,” he says.
“It’s an ideal way to build wealth and even small amounts can make a big difference in the long term.”
Super Booster Day was first held in 2016. The 2017 campaign is supported by CBUS, ING Direct, QSuper, Sunsuper and UniSuper.
Visit superboosterday.com.au to make a pledge, explore tips and calculators, and pay yourself forward.
You can also go into the draw to win one of five $1000 prizes. For your chance to win $1000 for your super fund, simply pledge, and tell us what your dream retirement looks like.