Industry Super
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Under Australia’s Superannuation Guarantee laws, employers are normally required to pay the equivalent of 11% of ordinary time earnings in FY2023/24. Because of a concern that this will still leave many retirees too reliant on the age pension, the Parliament legislated a gradual increase of the percentage to 12% by 2025.
Increases in the super guarantee have been discussed and implemented for almost as long as compulsory super has been around. Back in 1995, just three years after compulsory superannuation was introduced, economists were already warning that super contributions at current rates were likely to leave employees with insufficient super for a comfortable, independent income by the time they retire. In recent years, it has been generally accepted by governments that the super guarantee would need to be raised to 12% in order to meet the basic needs of Australian retirees in the future.
Due to the wonders of compound interest, over time, the small 1% change in statutory super contributions can make a huge difference to your retirement income by adding thousands of dollars to your super balance. Try for yourself!
AssumptionsCertain assumptions can be altered by the user
The assumptions used to estimate the potential impact of changes to the Superannuation Guarantee are, in our opinion, reasonable for the purposes of working out the estimates. The assumptions are based on objective evidence on long-term net returns, fees, relevant economic forecasts and analysis on wages, prices and productivity.
Your retirement outcome will be affected by many things including the amount of contributions you make, fees, investment returns and regulatory changes. Some factors that may affect your retirement outcomes may not have been taken into account.
Outcome is based on your contributions being made annually, at the mid-year point, on your fees being deducted annually and your investment returns being credited to your account annually.
The tool is not intended to be relied upon for the purposes of making a financial decision. Consider a fund’s PDS and your objectives, financial situation and needs, which are not accounted for in this information before making an investment decision. You are responsible for your own investment decisions and should obtain specific, individual advice from a financial services licensee before making any financial decisions.
All full-time, part-time and casual employees over 18 years of age are eligible for super guarantee contributions, or SGC. Employees under 18 years and private domestic workers (such as nannies) who work more than 30 hours a week are also eligible. Even certain contractors may be deemed to be eligible.
Many years ago, employees lost their eligibility when they reached a certain age, but this has been removed and there is no upper age limit.
Yes there is, but it only applies to if you earn more than $249,080 per year. For the 2023 – 2024 financial year, the maximum super guarantee contribution that an employer must pay is increased to 11% of $249,080 per year, or $27,398.80.
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