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The Importance of Superannuation and Financial Advice

Editorial Superannuation, General, Savings & Investments 09 Jun 2017

With all the super changes taking place after June 30, there is no better time than now to have a conversation with a professional, qualified financial adviser to help get your super in order.

Super is not a short term discussion

In the course of your life you may have many savings and investment objectives with a range of short to long term timeframes. Saving for a holiday or a used car in your younger days may take a year or two. A home deposit will take a little longer. Once you actually invest in a home, it may take 30 years or more to pay off.

The longest and perhaps most significant of all your investments, however, is your super. It will build throughout your entire working life and can potentially become your largest asset. Even after you have completed the contribution and accumulation phase, your retirement funds may still remain within the tax-protected super environment as you draw down on it during retirement.

The scope, span and size of your super, therefore, deserves to be considered more deeply than any other area of your financial life. It needs to be wisely invested, tax-effectively structured and properly maintained so that it meets your retirement lifestyle expectations.

The dangers of indifference

Despite its pre-eminent position in most people’s financial future, there is a general tendency to leave superannuation on ‘autopilot’ and not take an active interest in its management and investment. This approach can put you at a serious disadvantage in terms of your ultimate retirement outcomes. To get the most out of your super and to ensure you have an adequate strategy for retirement, it is critical to become engaged with it and to get the right advice about how to maximise your position. The question is: who do you trust to get that advice?

So who should you be taking advice from?

Your super is a major asset that warrants your active engagement so that it is managed and invested in a way that reflects your personal choices. The complexity of superannuation regulations and the taxation system, however, can make this quite a daunting prospect to deal with by yourself. Few of us have the time or inclination to become super experts ourselves and this is where the value of qualified, personalised advice can come into its own.

One of the key foundations of contemporary financial advice is that it must be based a close understanding of a person’s particular objectives, lifestyle circumstances and investment personality. Qualified advisers these days are trained in being able to help their clients to identify and crystallise these issues, so that a highly individualised strategy can be developed. The days of a ‘one size fits all’ approach to superannuation are long gone.

Another key advantage of obtaining professional advice on your super is that it is based on a long term relationship, not a quick fix. Circumstances change, objectives evolve and the investment environment fluctuates. A big part of an adviser’s role is to help you adapt your planning to cope with all of this. At the same time they have access to market and legislative research and analysis, which allows them to provide the kind of fact-based, objective guidance needed to capitalise on market and legislative movements.

The current changes announced to super due to be implemented in the new financial year, make it more vital than ever to have sound, qualified advice in your corner to make sense of it all and to ensure that your financial well-being is championed above all. 

Was this article helpful?

2 comments

"Hi Gavin, I totally agree. Being a financial planner and I am aware of this problem as my son is 20 and he has faced the same issues, few of his super account got closed due to low balance and he is also paying insurance premiums by default. The first thing that I told him was going forward, he should stick to a single super fund and use the choice form whenever he gets a new casual job. This is something that should be taught at school because super is part of everyday life for all Australians. "

Sarah Wang 10:48 on 11 Jun 17

"I found the best thing I've done around super in the last 5 years was to consolodate it all into 1 fund. Working in temp and casual jobs after uni meant that i had 6 different accounts all with bugger all in them and all charging fees. I was paying 6 lots of fees when I could should have just been paying 1! Taking into account the compounding over time - not sorting this would have cost be thousands of dollars going forward. It wasn't something I thought about in my 20's but I wish I was more aware at the time."

Gavin Reynolds 13:12 on 09 Jun 17

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