Superannuation and salary sacrifice

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Transcription

Interviewer: It’s where your family is number one, 96.5 and it’s that time of the evening, we’re going to find out more about how we can deal better with our superannuation. We’ve got our finance expert Helen on the line, evening, Helen.

Helen: Hey there, how are you doing?

Interviewer: Good, thank you, you’ve got some tips for us. Paying a little more in to our superannuation, is that right?

Helen: Yes, one of the ways that you can do that is called salary sacrifice, and the benefit of that is that instead of just getting your wages and then you pay your tax and then you take home your net income, you can send some of your wages through to your superannuation, and that should then give you a bit better tax deduction, so the pros are that it will reduce your tax generally, and then the second pro is that you are actually putting something away for your future into a tax structure that is quite favorable.

Cause superannuation is a tax structure and then you can define those benefits that sit underneath that. So there are pros in that areas, but the cons are briefly that depending on your age, accessibility is going to be an issue because you can only access superannuation under certain definitions and age is one of those potentially.

And the other con is that it seems to lead to legislation changes. So what might be suitable today, in 10 years time could be very different. So it’s about getting some good advice about what is specifically right for you, when should you be doing it, and how much you should be doing it.

Interviewer: Brilliant.

Helen: So those are things about salary sacrifice.

Interviewer: Brilliant, now it’s never too late, though there are the pros and cons, it is never too late to be thinking ahead really is it?

Helen: No because one of the benefits of investment is to have time. Cause time will help you iron out the lumps and bumps that will happen with investment. So if you have a shorter time frame sometimes what you think you might get might not actually be the same, so long term investing is really good, but you’ve just got to make sure that you don’t lock too much away in case you need that money.

Interviewer: Ah, brilliant. Well thank you very much, Helen, you just put it in plain English for me, and I totally understand it, I’m sure everyone else does as well.

Helen: Excellent.

Interviewer: You’re amazing. Now I’m thinking, helping us to plan ahead, maybe you could help us with planning ahead with those big Christmas purchases, maybe we can talk about that next week.

Helen: Sounds good, looking forward to it.

Interviewer: Awesome, thank you very much, Helen. If you want to find out more, it’s Helen Baker at OnYourOwnTwoFeet.com.au