Latest news with #AnneFuchs
Yahoo
3 days ago
- Business
- Yahoo
Superannuation alert for Aussie workers ahead of major July 1 change: 'Has to go down'
Millions of workers around Australia will benefit from a huge superannuation change that comes into effect on July 1, however, there are some who could be worse off. While the minimum wage and superannuation contribution rates are going up, those on certain contracts might find their take-home pay actually goes down. This could apply to those who have a salary package that is inclusive of superannuation. CPA Australia's superannuation lead, Richard Webb, told Yahoo Finance it's worth checking your contract or agreement ahead of Tuesday's change. "Broadly, the mathematics for people on total remuneration packages is such that if one goes up, the other has to go down," he said. More superannuation changes flagged as Baby Boomers get anxious Days left for millions of Aussies to claim ATO $20,000 tax benefit ATO reveals 10 highest paying jobs in Australia At the moment, your employer is obligated to send 11.5 per cent of your pay to your superannuation fund. From July 1, that rate will go up to 12 per cent as the mandatory minimum. It's been going up by 0.5 per cent increments since 2020. The Australian Retirement Trust (ART) said this five-year plan would see a 30-year-old earning $100,000 each year retire with an additional $125,000. 'This half per cent step may seem small, but for working Australians, it's like reaching the summit of your own financial Everest,' ART's Anne Fuchs said. 'Since the Superannuation Guarantee (SG) was introduced in 1992, it has become the cornerstone of Australia's retirement system – evolving from a modest 3 per cent contribution to a robust framework that provides you with meaningful savings for your future.'The SG rate increase will benefit a lot of workers as many of them will have organised a salary plus superannuation package when they scored their job. If they're getting paid $100,000 per year, for example, that means their employer will contribute an additional $12,000 to their retirement nest egg. But, if their pay was $100,000 per year including super, their actual pre-tax take-home would be $88,500. With the changes to super from July 1, that number could drop by $500 to $88,000 to account for the 0.5 per cent jump. There's no official data on how many Aussies have a salary package that includes super. When you're looking at job adverts, if it displays how much the pay is, it will usually reveal whether super is included in that number or if it goes on top. If the number isn't displayed, it's worth asking the recruiter or hiring manager what the setup is, so there are no surprises when you get your first pay cheque. Webb said it's worth checking your contract to see if it mentions how your pay is structured. If you don't have that document handy, there is another course of action. "Go and chat to your employer and see how they think this is going to work out," he said. "In most situations, employers are already geared up to get these questions from their employees, and may actually have something ready to go that they can give to them that explains it all." Employers who don't have that knowledge need to start reading up on all the changes happening from July 1 to ensure staffers don't get accidentally "blindsided". "It's a great reminder for employers to make sure that their employees have got the right idea about how things are going to change," he in to access your portfolio
Sky News AU
20-06-2025
- Business
- Sky News AU
About $125k nest egg bump for 30-year-old Aussie on average salary amid super hikes, Australian Retirement Trust shows
A 30-year-old Australian earning the average salary will be $125,000 better off by the time they retire under recent changes to superannuation launched over the past five years. This is the finding of Australian Retirement Trust (ART) which said the gradual increase of the mandatory superannuation contributions from 9.5 per cent in 2020 to 12 per cent from the start of July will contribute more than six figures into young Australians' super accounts. ART's executive general manager for advocacy and impact Anne Fuchs said a 30-year-old on $100,000 per year – the average salary in Australia – will reap massive benefits of the increases since 2020. "In a fortnightly pay statement, the increase in the superannuation guarantee rate may seem tiny,' Ms Fuchs said. 'But over a working lifetime, the magic of compound returns can turn those small increases into hundreds of thousands of dollars.' It comes as working Aussies will receive a 0.5 per cent super contribution bump from the start of the coming financial year. Mrs Fuchs likened the increase to 'reaching the summit of your own financial Everest' for many working Australians. 'Since the superannuation guarantee was introduced in 1992, it has become the cornerstone of Australia's retirement system – evolving from a modest three per cent contribution to a robust framework that provides you with meaningful savings for your future,' she said. 'An increase in superannuation contributions means you'll be adding that little bit extra to your super and over time, that really adds up.' The gradual super contribution changes from 9.5 per cent to 12 per cent was originally proposed under the Rudd government and enacted under former prime minister Scott Morrison. Other research from the Association of Superannuation Funds of Australia showed a 30-year-old worker earning $75,000 will be $20,000 better off due to the 0.5 per cent super change. The bump comes as Australia's $4.2 trillion super nest egg will grow from the fourth largest super pool in the world to the second over the coming decade. This is according to a report from the Super Members Council which showed Australia will surpass the United Kingdom's and Canada's pensions amid growth in Australia's superannuation guarantee scheme. Super Members Council CEO Misha Schubert lauded Australia's super system as the 'envy of the world'. 'Australia has the fastest growing super system globally – twice the rate of international peers,' Ms Schubert said. 'We're the only OECD country where spending on government-funded pension payments is falling and will continue to fall.'
News.com.au
20-06-2025
- Business
- News.com.au
‘Good news': Australians tipped to be $125k better off in retirement
The average young Australian is tipped to be $125,000 better off in their retirement simply by staying in the workforce, a major superannuation fund reveals. Australian Retirement Trust says the rise in the superannuation guarantee over the last five years is 'good news' for Australian workers who will have more in their retirement nest egg. Under changes to the superannuation guarantee proposed by the Rudd government and enacted by the Morrison government, every working Aussies superannuation rate automatically went from 9.5 to 12.00 per cent. The changes were brought in incrementally, up 0.5 per cent a year, with the final change starting from July 1 2025. According to the Australian Retirement Trust this five year plan will now see a 30-year old earning $100,000 retire with an additional $125,000 when they finish up their careers. Australian retirement trust executive general manager for advocacy and impact, Anne Fuchs, said the boost to the SG rate is good news for all working Australians. 'This half per cent step may seem small, but for working Australians, it's like reaching the summit of your own financial Everest,' Mrs Fuchs said. 'Since the Superannuation Guarantee was introduced in 1992, it has become the cornerstone of Australia's retirement system – evolving from a modest 3 per cent contribution to a robust framework that provides you with meaningful savings for your future.' Separate research from the Association of Superannuation Funds said the increase from to 12 per cent will mean the median 30-year old worker making $75,000 a year will add about $20,000 to their superannuation balance by the time they retire. This $20,000 increase will mean the median 30-year old will retire with $610,000 in superannuation, above the $53,383 a year or $595,000 they would need for a comfortable retirement. Couples should fare even better. ASFA says a couple requires $73,875 a year or $690,000 combined in total to live comfortably in retirement using their super plus age pension top-ups. The major caveat to these figures for singles and couples is owning your own home by retirement. Check your superannuation rate While the rate of change might seem small, Australian Retirement Trust urges Aussies to check their superannuation rate. According to survey data by the super fund four out of every five Australians don't know how much they've put away for retirement, while only one in five can correctly identify the current superannuation guarantee. 'Whether you're just starting your career or nearing retirement, understanding these changes can help you make smarter financial decisions,' Ms Fuchs said. 'As we look towards our own retirement savings, we should also look towards ensuring the Superannuation Guarantee is fit-for-purpose as our nation ages and grows.
