Latest news with #ASFA
Yahoo
29-05-2025
- Business
- Yahoo
Major superannuation change to give Aussie workers $600,000 boost in weeks
Compulsory superannuation payments will increase in the coming weeks, and the boost will help young Australians retire with nest eggs of more than $600,000. This is nearly triple what some people are retiring with today. The super guarantee rate will increase from 11.5 to 12 per cent from July 1. This is the final legislated increase to the rate that employers are legally required to pay into your superannuation. A 30-year-old with a super balance of $30,000 today who earns the median wage of $75,000 is expected to accumulate a super balance of $610,000 in today's dollars, new research from the Association of Superannuation Funds of Australia (ASFA) found. RELATED $3 million superannuation tax change sparks property warning as 'panic' selling begins $1,831 Centrelink payment change coming within weeks: 'You'll get more' Australia's most in-demand jobs revealed with $125,000 salaries up for grabs: 'Short supply' Compared to previous generations, today's workers will benefit from higher compulsory contributions rates for longer periods of time. The median super balance for 60- to 64-year-old men today is $205,000, while for women in the same age bracket it is $154,000. ASFA found there was strong support for superannuation from younger Australians, despite them being decades away from retirement. It found 77 per cent of the 18 to 34 age bracket believed the compulsory contribution rate should be at least 12 per cent, while 82 per cent agreed or strongly agreed that regular contributions made them feel more confident about their financial future. 'The strong level of satisfaction, trust and confidence younger people feel about their super is encouraging to see as superannuation is often not front-of-mind for younger people,' ASFA CEO Mary Delahunty said. 'This result demonstrates that younger Australians are engaged with superannuation and well aware of its positive contribution in shaping their financial security in retirement.' To achieve a comfortable retirement, ASFA calculated that a single person needs $595,000 in superannuation, while a couple needs $690,000. These figures assume the retiree draws down all their capital and receives a part Age Pension. Super Consumers Australia has calculated Aussies need less in superannuation to retire, with its targets finding a single person needs around $310,000 and a couple around $420,000. ASFA noted that the contribution rate of 12 per cent wouldn't, in itself, guarantee adequate retirement incomes for today's younger workers. Factors like time out of the workforce to have and raise children, along with working in jobs not covered by the compulsory system, like gig economy work, would impact a person's capacity to build up their savings. The super guarantee rate increase to 12 per cent is just one change kicking in from July 1. Superannuation accounts with balances of $3 million or more will see the existing tax rate increase from 15 to 30 per cent on earnings above this threshold, including unrealised capital gains. This change is due to come into effect from July 1 but hasn't yet been legislated. Superannuation will start being paid on Parental Leave Pay from the new financial year. This means parents getting the government support will get an extra 12 per cent of their payment as a contribution to their super fund. The transfer balance cap, which limits the amount of super that can be transferred into the retirement phase, will increase by $100,000 from $1.9 million to $2 million. There has been some misinformation about changes to preservation and withdrawal rules, but the ATO has assured people that this is in retrieving data Sign in to access your portfolio Error in retrieving data
Daily Mail
07-05-2025
- Business
- Daily Mail
How much superannuation you should have?
Australians approaching 60 have insufficient super to retire comfortably as Donald Trump 's trade wars diminish retirement savings. SuperRatings executive director Kirby Rappell said Trump's tariffs had hit super balances, by causing volatility on share markets, making those approaching 60 reconsider their retirement plans. 'The volatility's back, that is causing anxiety for people,' he told Daily Mail Australia. 'That does make people worry about what retirement's going to look like.' How much super is enough to retire? The oldest Generation X workers, turning 60 this year, can access their superannuation and would need $453,000 for a comfortable retirement - based on going on an overseas holiday every seven years. But men aged 55 to 59 only have $301,922 on average, compared with $228,259 for women, Association of Superannuation Funds of Australia data showed. Why is share market volatility a problem? Share market volatility is particularly concerning for those wanting to retire soon and live off their super before they qualify for the age pension at 67. While superannuation balances have bounced back, since Trump announced a 90-day pause on reciprocal tariffs, growth-orientated retirement savings are still typically below where there were in February when the share market peaked. Those worried about the share market are urged not to panic with balanced funds delivering average returns of 6.7 per cent during the past decade. 'The positive is returns have held up not too bad if you look over the long term,' Mr Rappell said. 'The reality is there is going to be more ups and downs. 'For most people, it's trying to figure out what they need to do for the long term and try and just block out all the noise to stay sane given it's just a more uncertain period that we're in.' How much should I have in my super account at my age? Those turning 50 this year need $281,000 in super but those in their late forties are falling short, with average super balances of $180,958 for men and $136,667 for women. Millennials turning 40 need $156,000 but men in their late thirties only typically had $90,822 compared with $71,686 for women. By age 67 - when someone can get the age pension - it's recommended they have $595,000 in retirement savings. Someone in this situation, who has paid off their home, would be able to take an overseas holiday every seven years or go someone within Australia annually. Despite the recent turmoil on share markets, Mr Rappell said growth-orientated super products with a higher exposure to shares were much more likely to deliver stronger returns, compared superannuation funds geared towards cash. 'It's unlikely going to get where you want to be in retirement just taking cash,' he said. How can you live off super? From age 60, Australians can draw down on their super or take out a lump sum to pay off their mortgage or outstanding personal loans. From 67, super can be combined with the age pension. 'If you have got enough super, you should talk to your fund to understand how they can let you take out the money in chunks so you can get a couple of hundred bucks a week on top of your pension,' Mr Rappell said. Those approaching retirement can have their savings in both an accumulation account, geared towards higher returns, and a retirement account they live off. During the accumulation phase of super, workers pay a 15 per cent tax on earnings. But after someone turns 60 and stops working, their super earnings are tax-free for retirement savings of up to $1.9million 'At some point, they can draw down in an income stream from their super and leave it in their super fund and still get the returns on it and no tax on earnings,' Mr Rappell said. 'You don't have to take the money out and put it under your bed; you can actually get the benefit of navigating investment markets.' Compulsory employer super contributions are rising to 12 per cent on July 1, up from 11.5 per cent now. Individuals wanting to make voluntary contributions on top of that are taxed at a concessional rate of 15 per cent, which is well below the marginal tax rate for incomes above $18,200.
Yahoo
21-04-2025
- Business
- Yahoo
Superannuation nightmare as $14,000 impact of Trump's tariffs on everyday Aussies revealed: 'Going backwards'
Donald Trump's tariff chaos on Aussies' nest eggs has finally been revealed, and it's not good news. The US president's constantly changing foreign policy has sparked massive swings on the Australian and global share markets. Because many people's superannuation funds are invested in these markets, their retirement money has been at the whim of these sometimes daily changes. Superannuation consultant firm Chant West said the median super balanced option fell 1.9 per cent in March. This option is projected to drop a further 2 per cent in April. Aussie boss reveals huge cost of Trump vs China tariff war bloodbath: 'Scramble' Accountant's ATO warning as $5,000 expenses you can claim on tax without receipts revealed Traffic controller responds to $200,000 pay 'rumour' as she reveals salary after 2 days of training The median super balanced option, according to Chant West, has between 61 to 80 per cent of money invested in shares. The average superannuation balance for Aussies aged 65 to 69 was $428,056, according to ASFA. That means the average Aussie who has just hit retirement could have seen upwards of $13,355 drained from their nest egg in less than two months. An Aussie wanting to meet a "medium" retirement standard would roughly spend around $43,000 per year, while a couples would spend around $62,000. That recent fall equates to nearly four months of living for a single losses were even more pronounced for those with super funds geared to all growth. That's where 96 to 100 per cent of money is invested in shares, and they were down 3.3 per cent in March alone, which is a $14,125 drop. High-growth accounts, which have 81 to 95 per cent invested in shares, fell 2.5 per cent. Even though the last two months have been volatile, the median super fund was still up 5.5 per cent over the nine months of the 2024-25 financial year. All growth was up 6.9 per cent for the same time, while high growth was up 6.0 per cent. But Chant West senior investment research manager Mano Mohankumar doesn't want these figures to spark panic amongst retirees or those on the verge of retirement. 'While we appreciate that members all have different tolerance levels for seeing their account balance going backwards, the majority can afford to remain patient, even many older members,' he said. 'When markets fall sharply, there is a tendency for some people to think about moving to lower-risk options or cash, with a view to moving back later, either out of fear or as an attempt to time the market. 'But far more often than not, that strategy results in a worse long-term outcome than if you stay the course." A poll of more than 3,700 Yahoo Finance readers found 70 per cent were worried about the impacts the US tariffs will have on their superannuation in the short and long term. That's the million-dollar question. Donald Trump announced a 90-day pause on the tariffs for dozens of countries, and it led to massive rallies on the ASX and US markets. They certainly didn't return to pre-tariff levels, but the turnaround wiped off a lot of losses that occurred that week. It's unclear what will happen between now and that 90-day deadline, and whether Trump sticks to his guns or organises new deals with those affected nations. H&R Block director of communications Mark Chapman told Yahoo Finance that more chaos like we've seen in April could lead to a horror reality for many older Aussies. "Unless there is a rapid uptick in the stock market, this could mean that many people will have to work longer to afford the kind of retirement they thought they were looking at just a few weeks ago," he said. "Reduced economic activity and possibly higher unemployment will lead to a reduced income tax take and a reduction in sales of goods and services will lead to a reduction in the amount of GST collected. "Exports will be hit and sales of vital minerals and ores will inevitably occur with the shrinking of the world economy, leading to less demand and less tax being paid into the system. "This could lead to increased government borrowing to support the domestic economy." The Reserve Bank of Australia is even tipped to cut interest rates next month to stem some of the impacts of the tariffs.
Bloomberg
15-04-2025
- Business
- Bloomberg
What Messy Stock Markets and The Election Mean for Your Super
Australia's pension funds, known as superannuation, control a combined A$4.2 trillion, a lot of which is held in offshore assets with direct and indirect exposure to Trump's tariff war. This week on the podcast, host Chris Bourke and ASFA CEO Mary Delahunty unpack the major parties' election platforms relating to retirement savings and look at what superannuation funds are doing to stay calm in a time of global market turmoil. Read More: Listen and follow The Bloomberg Australia Podcast on Apple, Spotify, on YouTube, or wherever you get your podcasts. Terminal clients: Run {NSUB AUPOD } on your desktop to subscribe.
The Guardian
04-04-2025
- Business
- The Guardian
Australian super funds compromised after data breach as hackers use stolen passwords
Hackers have targeted Australian superannuation funds this week, the retirement savings industry's peak body has said, with a number of funds having member data compromised. The Association of Superannuation Funds of Australia (ASFA) said in a statement on Friday that hackers attempted to breach the cyber-defences of a number of superannuation funds last weekend, and while the majority of attempts were stopped, a number of companies were affected. ASFA did not name them, but said funds were contacting all affected members to let them know if their data had been compromised. 'Retirement savers should be assured superannuation funds and their service providers already have rigorous cyber protections in place,' ASFA said in a statement. A spokesperson for Rest superannuation fund said the attack had affected 8,000 of its members, with limited personal data exposed in the majority of cases, including first names, email addresses and Rest member numbers. The fund said there was a chance other data – including full names, addresses, account beneficiaries and account balances – could have been accessed for fewer than 20 members. 'Due to our incident response protocols, the impact has been limited to less than 1% of our members. Nevertheless, this will be very concerning for the members who have been impacted and we are very sorry this has happened,' Vicki Doyle, cheif executive at Rest, said. 'We are in the process of contacting impacted members to work through what this means for them and provide support. No member funds were transferred out of impacted members' accounts due to these unauthorised access attempts.' AustralianSuper confirmed it had been the victim of an attack, with passwords stolen from 600 members used to log into their accounts and attempt to commit fraud. 'Over the past week, we have seen a spike in suspicious activity across our member portal and mobile app and we are urging members to take steps to protect themselves online,' AustralianSuper's chief member officer, Rose Kerlin, said. 'While we took immediate action to lock these accounts and let those members know, there are things members can do right now to protect themselves online.' The fund advised members to log into their accounts to make sure their bank and contact details are correct, and ensure they use a strong and unique password for the account. Australian Ethical said its analysis so far shows the fund was unaffected, but the attack has been exacerbated by reuse of passwords that have been in previous data leaks. 'While the reported attacks appear to involve the reuse of passwords exposed in earlier data breaches, we are not being complacent,' the fund said. 'We have multi-factor authentication for all members, and internal controls to protect members in these circumstances.' ASFA said the industry was working together to improve system-wide defences, including establishing a hotline between the sector and relevant government agencies, improve information sharing, and developing frameworks to combat financial and cybercrime. More details soon …
