Superannuation and Planning your Retirement
Superannuation should always be a part of your retirement planning to achieve your goal of having a comfortable retirement income. In retirement your superannuation can provide you with tax free income that is not available under any other structure.
Last weekend I heard on the Radio comments from an investment advisor saying that if you wanted to improve your retirement lifestyle then superannuation is not the vehicle to use.
Accumulating a sufficient retirement nest egg is a combination of accumulating assets in an effective manner and achieving good investment returns. Superannuation will always score highly as “an effective manner” because of the concessional tax treatment. The fact that you can use your superannuation fund to borrow for investments further adds to its effectiveness.
On the other hand only using superannuation for your retirement means you have a lack of accessibility of your savings if an urgent need for money occurs. Superannuation cannot be accessed till you are 55. To also say that super is complicated is saying that having personal investments and working out capital gains, franking credits or depreciation allowance isn’t. If you have another investment vehicle for your retirement you will need to know all the different taxation rules or expect your accountant to be give you specialist tax advice.
The key to achieving your goal of a comfortable retirement income is to understand your superannuation and then take control of your situation. Seek the right advice and make the best decision. Superannuation is not to be dismissed as not having a place in your retirement planning.
So where does superannuation fit into your retirement plan?