Superannuation Flashcards
(10 cards)
What is superannuation?
Money put aside by your employer/ work over the course of you working life for you to live on durn retirement. It is a from of compound interest that you invest in over a course of decades. You can access it after the age of 65.
How much of your annual income goes into your super?
11.5%
How does super help to improve socio economic issues?
Most Australians don’t invest till later on in life when they realize the importance of finical security/ freedom, by putting away money early so we can prevent issues such as homelessness. property, lack of income, etc.
How does super benefit the GDP (gross domestic product) growth?
Super allows you to invest in Australia’s economy such as certain industries, thus Australia grows its global economy and performance in the wider world
what are the restrictions on super?
You can not contribute less than 11.5% to your super.
Withdrawing your super early (before the age 65) makes it prone to taxation.
What are 3 different types of super?
Uni super- high performance
Christian super- high fees
Ethical/environmental super- invest in non environmentally friendly industries
Things to consider when it comes to investment portfolios
Portfolio risks: What does the super invest in? More reliable Industries (banks), High risk growth industries (technology), Ethical options etc
fees: is it a set amount or a percentage based?
Performance: What is the longer term growth of the super
What is salary sacrifice? (Pre tax)
This is an option to put away some of your pre- tax income into your super. Eg. instead of putting away 11.5% standard you can put away 15%. Though this reduces your income, you technically are earning more due to the less overall tax.
What is voluntary contributions? (post tax)
You are able to put money into your super after tax. The Australian government actually rewards you for doing this, and grants you a portion of your tax back on your tax return- the amount depends on tax, income, and contribution.
What is the first home super scheme?
This is an option unique to Australian home buyers whereby you can put away some of your income to save up for a house. This allows a temporary compound investing rather than just saving up the all fashion way.
