Latest news with #AustralianSuper
News.com.au
7 hours ago
- Business
- News.com.au
Sting in the tail for some workers in super boost
Workers are being urged to check with their pay packets to ensure an increase to the super guarantee doesn't result in their pay being docked. As the final increase to Australia's super guarantee comes into effect, employers will be required to devote a record 12 per cent of workers' salaries into their super for the first time. For most workers on an award agreement, it's happy days, with employers forced to tip in extra super without any reduction in their take-home pay. But there's a sting in the tail for a minority of workers who are on a total remuneration package including super, because it could mean less take-home pay. In fact, for up to 40 per cent of Australians who have an individual pay arrangement with their employer that pays superannuation as part of their salary package, the 0.5 per cent could result in a reduction in take-home pay. CPA Australia's Superannuation Lead, Richard Webb said while the super guarantee was positive for a majority of workers, some would cop a pay cut from July 1. 'If your employment contract includes a total remuneration package including super, this could mean less take-home pay at the end of the month,' he said. 'However, for those on award or enterprise agreements, your pay agreement is more likely to be a salary, which means the change will not affect your take-home pay. 'It's a good idea to check with your employer to see how they view the changes and what it means for you. Otherwise, you might get a shock if your take-home pay is a little less than expected.' Nearly 30 years after the Hawke-Keating Government introduced superannuation starting at just 1 per cent, around 14 million workers are set to secure the new boost. New Treasury analysis shows that millions of Australians will be better off at retirement as a direct result as the super guarantee lifts from 11.5 to 12 per cent. 'These reforms will make a meaningful difference for millions of Australians who work hard on low and award wages, and Australians working towards a well-deserved, dignified retirement,'' Treasurer Jim Chalmers said. 'Under Labor, inflation is down substantially, real wages are up, unemployment is low, our economy is growing, debt is down and interest rates are falling, but we know people are still under pressure. 'All the progress we have made together means we are well placed and well prepared at a time of global economic uncertainty and volatility. 'Since we've come to government, we've increased the superannuation guarantee four times, and this means an extra $98,000 at retirement for a 30 year old earning the average full-time income.' For example, a worker at age 30 earning the average full-time income (around $103,000) will have an extra $21,000 at retirement as a result of this 0.5 percentage point increase alone. However, Treasurer Jim Chalmers said taking into account all of the Albanese Government's increases to the Superannuation guarantee (from 10 per cent to 12 per cent), this worker will have an extra $98,000 at retirement.
Yahoo
2 days ago
- Business
- Yahoo
More superannuation changes flagged as Baby Boomers get anxious: 'Not realistic'
The government has stirred up a significant amount of controversy over its $3 million superannuation tax plan. But it appears more changes to the country's trillion-dollar retirement system are on the cards, which could make some Australians already anxious about their nest eggs even more worried. Assistant Treasurer Daniel Mulino has rejected the criticism thrown towards the proposal to tax super balances above $3 million at 30 per cent. He said changes like this, and others in the future, were necessary to ensure superannuation keeps pace with reality. 'I think it's not surprising that a system as large and complex as super is occasionally examined, and occasionally there are policy tweaks. We see this right across the economy,' he told the Australian Financial Review. RELATED $3,000 superannuation boost coming for Aussie parents from July 1 ATO $1,519 cash boost heading for Aussies in weeks Centrelink payment alert for 58,000 Aussies in caravans 'I don't think it's likely that superannuation is not going to be changed ever again. That's not realistic … superannuation has achieved many very strong outcomes, but that isn't to say it doesn't need to be reformed occasionally.' Despite some raising their concerns around the $3 million super tax policy, Labor is going full steam ahead with it. 'We've got a mandate for that change,' Treasurer Jim Chalmers recently said at the National Press Club.'We're not looking for opportunities to go back on the things that we have got a mandate for. We're looking for new ideas.' The government said roughly 80,000 people would be affected by the change, which taxed balances over $3 million at double the current rate. However, in its current form, that $3 million benchmark isn't indexed, and there are fears millions could be caught up in the tax in decades to come. The government hasn't ruled out indexing the benchmark in the future. As Labor mulls more changes to the system, Aussies are getting restless about their retirement savings, particularly after a fairly wild few months. Donald Trump's global tariff battle and the outbreak of fighting in the Middle East have seen the Australian and US share markets go from worrying lows to record highs, and from sudden panic to excited rejoicing. AustralianSuper found Baby Boomers were understandably the most worried about their retirement nest eggs, with 33 per cent saying they were anxious about the current market volatility. But 22 per cent of 25 to 34-year-olds also had fears for their super savings. 'Our research shows 40 per cent of people believe it's better to switch their super to cash or lower-risk options during periods of market volatility and then reinvest when markets recover," Alistair Barker, AustralianSuper's Head of Asset Allocation, said. But he added that doing this could risk 'adverse long-term outcomes' due to missing market returns following downturns. Interestingly, though, 45 per cent said they would keep their investments the same even if there was a 'significant' market drop, which AustralianSuper believed reflected the 'growing awareness of super's long-term nature'. Changing your superannuation investment strategy can be done at any point in your life. But Barker said it's worth remembering that super is a long game, and if history can teach you anything, it's that the market has always bounced back from rough moments. "Someone who switched to cash as the market dropped in early April this year would have missed out on the strong recovery in later April and May,' Barker said. Before Trump's Liberation Day tariffs were announced earlier this year, the Australian stock market (ASX 200) was hitting record highs. However, it fell from a peak close of 8,555 points in mid-February to 7,343 points in April. In the US, the Nasdaq 100 hit a high of 22,175 points in mid-February and dropped to 17,090 points in April. The S&P 500 and Dow Jones had similar movements. These crashes wiped tens of thousands of dollars from Aussies' super accounts, and many feared the ASX and US markets, and their retirement savings, could fall even further. But the ASX 200 recently eclipsed that February number and recorded 8,587 points on June 10, while the Nasdaq 100 broke a new record this week with 22,190 points. The S&P 500 and Dow Jones are also just behind their all-time highs as well. Barker said the same thing happened before, during and after the Global Financial Crisis in the late 2000s and the initial onslaught of the COVID pandemic in the early 2020s. 'These fluctuations are to be expected, and over the long term, superannuation is built to weather these storms," he added. 'We're encouraging our members to focus on time in the market, not timing the market. While it's tempting to make changes when markets fall, history shows that those who stay the course tend to see stronger, longer-term results.' People worried about the future of their superannuation are encouraged to reach out to their super fund to discuss their options and what results those choices could create. What investments are right for you will depend on your personal circumstances, including your tolerance to risk and investment in to access your portfolio
Daily Mail
3 days ago
- Business
- Daily Mail
Aussies warned against making huge super mistake that could cost you big
Australia's biggest super fund is urging retirement savers to avoid panic switching to cash as Donald Trump 's tariffs cause share market turmoil. The benchmark S&P/ASX200 peaked in February but dived by 14 per cent by early April as a series of broad-based import taxes on goods entering the US rattled financial markets. But since then, the Australian market has soared by 16 per cent to test new peaks as Trump tried to de-escalate his trade war with China. AustralianSuper's head of asset allocation Alistair Barker said switching super to cash, from growth-oriented assets like shares, was a bad idea during a time of share market volatility. 'While it's tempting to make changes when markets fall, history shows that those who stay the course tend to see stronger long-term results,' he said. A large chunk of Australians think switching to cash or a lower-risk option during a downturn is a good idea, with 40 per cent of people backing that idea, a YouGov poll of 1,011 adults taken in June found. AustralianSuper, Australia's biggest super fund with 3.5million members, commissioned the survey to illustrate the need to avoid panicking. It found one in three baby boomers, born from 1946 to 1964, to be the most anxious, considering they are now all of retirement age and able to access their super. A bear market typically occurs every two to three years, with global share markets diving by 20 per cent. This included the onset of Covid in 2020 and the 2025 volatility sparked by the Trump tariffs. 'These fluctuations are to be expected, and over the long term, superannuation is built to weather these storms,' Mr Barker said. AustralianSuper calculated that $100,000 invested in 2005 would now be worth $430,000 in 2025 in a balanced option which included exposure to shares. During the past decade, an AustralianSuper fund with a balanced option has delivered average annual returns of 7.6 per cent. Funds with greater exposure to Australian shares delivered returns of 9.3 per cent, while those with a bigger holding of international shares returned 10.5 per cent. By comparison, funds with just cash returned a mere two per cent on average. Separate SuperRatings data showed balanced retirement savings funds, with a 60 to 76 per cent orientation towards growth assets, delivered monthly returns of 2.6 per cent in May. This followed a flat 0.6 per cent gain in April, despite the big slump in share markets. The Australian share market was marginally firmer on Wednesday, with Moomoo market strategist Michael McCarthy noting investors were relieved that Donald Trump had ordered Israel to cease its bombing campaign of Iran. A prolonged war in the Middle East had threatened to stop oil moving through the Strait of Hormuz, which had seen crude oil prices this week climb above $US70 a barrel. 'Shares rallied in overnight trading as investors moved up the risk spectrum on the prospect of a peaceful resolution of conflict in the Middle East,' he said.
The Guardian
5 days ago
- Business
- The Guardian
AustralianSuper criticised for buying up shares in Whitehaven Coal while claiming to be committed to net zero
A major Australian superannuation fund is under fire for substantially increasing its investment in the coal company Whitehaven, and being on the brink of becoming its biggest backer, while still claiming to be committed to reaching net zero emissions. Shareholder advocacy groups said AustralianSuper was moving against the trend of its peers with recent share purchases in the company, which they said were 'flying in the face of environmental, social and governance (ESG) commitments'. Clean energy finance organisation Market Forces said the super fund was 'on the precipice' of becoming Whitehaven Coal's largest investor, with shares worth about $395m. Recent disclosures by Whitehaven, first reported by the Australian Financial Review, reveal AustralianSuper now owns 70.9m shares in the company, or 8.47% of shares on issue, after the recent purchases. AustralianSuper is the second-largest shareholder in the coal company and, according to Market Forces, holds nearly triple the combined shares of all of the other top 30 super funds in their default investment options, based on the latest disclosures effective as at December 2024. Market Forces said 'after fully and publicly divesting from the company in 2020', AustralianSuper now held its biggest interest in Whitehaven in 10 years. Sign up to get climate and environment editor Adam Morton's Clear Air column as a free newsletter 'How on earth can AustralianSuper call itself a responsible investor after buying millions of shares in Whitehaven Coal?' Market Forces' senior analyst, Brett Morgan, said. 'AustralianSuper is backing Whitehaven's expansion plans, which would result in nearly 5bn tonnes of carbon pollution from burning coal, equivalent to running all of Australia's coal-fired power stations until 2062.' Morgan said the organisation had been contacted by dozens of AustralianSuper members concerned 'that their fund is greenwashing and endangering a safe future for their retirement'. An AustralianSuper spokesperson said the fund remained committed to its long-term goal of net zero by 2050. 'Whitehaven's acquisition of BHP's metallurgical coal assets changed the company's revenue profile and made it a more attractive investment given their importance in steel making,' the spokesperson said. Metallurgical coal is used primarily to make steel while thermal coal is primarily used for electricity generation. Sign up to Clear Air Australia Adam Morton brings you incisive analysis about the politics and impact of the climate crisis after newsletter promotion 'The energy transition is not linear, which means thermal coal will be an important stabilising source of electricity for the grid for some time to come, both domestically and overseas.' But Naomi Hogan, from the Australasian Centre for Corporate Responsibility, said climate-aware investors across the superannuation sector had been making an effort on ESG and emissions reductions and 'this AustralianSuper move is going against the trend of its peers'. 'Metallurgical coal investing cannot be used to shield against scrutiny of coal,' Hogan said. 'Last year ACCR published research based on a global survey of 500 investors in the steel value chain, which found that 80% of investor respondents believe metallurgical coal's risk profile will increase in the next decade.' Hogan said AustralianSuper, having previously 'talked up' the importance of its companies aligning with the objectives of the Paris Agreement, now has a 'huge amount of work ahead to bring [Whitehaven's] emissions into line'. 'ACCR will be looking closely at AustralianSuper's disclosures outlining its ESG risk assessment of this investment,' she said.
AU Financial Review
19-06-2025
- Business
- AU Financial Review
Financial Review reporter Lucas Baird wins Mid-Year Walkley Prize
The Australian Financial Review's superannuation reporter Lucas Baird has been awarded a Walkley Foundation Mid-Year Media Prize for revealing a cyberattack on some of the country's largest funds, including Australian Super and Australian Retirement Trust.
