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Super tips for your 50s and 60s

Super tips for your 50s and 60s

Think about the lifestyle you want in retirement and consider if what you have put in place might need to change.

As you get closer to retirement the way you manage your super may start to change.

Tip 1: Save on tax by making extra contributions

By law your employer is generally required to put 9.5% of your salary into your super account.

If you choose to make extra pre-tax super contributions (for example salary sacrifice contributions) you may save tax.

Pre-tax contributions into your super are, for most people, taxed at a rate of 15%, which may be less than your marginal tax rate.

See more information from the Australian Government on contribution caps and thresholds.

Tip 2: Assess your investment strategy

You’ll be starting to get a clearer idea of when you’re likely to retire and how much you’d like to retire with. You can use our Retirement Calculator to see how much super you will have saved by contributing at your current rate.

Think about your current investment strategy – is it going to get you where you want to be? Or, are you taking on more risk than may be necessary for a comfortable retirement? This could be a good time to engage with a financial planner to explore the pros and cons of different approaches.

Also look into whether you’ll qualify for the age pension. If so, this may take some of the pressure off your super.

Tip 3: Review your insurance coverage and beneficiaries 

Things can change and arrangements you made earlier in life may no longer be applicable. Take a look at the nominated beneficiaries on your super to make sure everything is up to date. You may also want to consider putting in place a binding or non-lapsing death benefit nomination if you don’t already have one. 

You may also want to look at any insurance coverages tied to your super. Are they all still relevant or are there any that you feel should be added?

Tip 4: Consider how you want your super paid

There are various ways you can access your super. Start by figuring our when you’ll reach preservation age.

Then you’ll want to think about what strategy will best suit you, for example you can turn your super into an income to be paid over time or just withdraw a lump sum.

Again, at this stage a financial planner may be able to assist you in finding the best way forward.

Remember, before you make a decision about your super, you should compare the costs, fees, risks and benefits of super funds. It makes sense to consider whether you can replace any insurance cover you may lose when you bring your accounts together, as well as any costs for withdrawing from other super funds and any investment or tax implications. This article is intended to provide general information only and does not take into account your individual objectives, financial situation or needs. Taxation considerations are general and based on present taxation laws and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information. The Commonwealth Bank is also not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and you should seek tax advice from a registered tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise, or could arise, under a taxation law. Colonial First State Investments Limited ABN 98 002 348 352, AFS Licence 232468 (Colonial First State) is the Trustee of Commonwealth Essential Super ABN 56 601 925 435 (Fund) and the issuer of interests in Essential Super which is a product of the Fund. A Product Disclosure Statement (PDS) for Essential Super is available in branch, from or by calling 13 4074. You should read the PDS and assess whether the information is appropriate for you before making an investment decision. Colonial First State is a wholly owned subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124 (‘the Bank’). The Bank provides certain distribution and administrative services to the Trustee. The Bank and its subsidiaries do not guarantee the performance of Essential Super. Information in this article is up to date as at the date of publication.