Most employees with a monthly income of $450 or more should receive some form of contribution from their employer. This is known as superannuation and it usually makes up 9.5% of your quarterly income. It goes into a “nest egg” fund of your choice to ensure a comfortable retirement in the future. Here are some actionable tips on how to maximize your superannuation fund today:
- Cultivate an investor mindset
Once you start making contributions to your super, you become an investor. After all, your superannuation is invested all over the world in things that you can’t even imagine. That’s why it might be a good idea to start cultivating an investor mindset. If you don’t know where to start, search for SMSF accountants to help guide you through the process. Once you start seeing yourself as a global investor instead of a consumer, you’ll start to make smarter decisions that’ll make you wealthier.
Taking into account the long-term nature of superannuation, most super funds have a range of investment options that weigh the risk of the investment against the amount of interest returned. So you might choose to increase the interest returned on your superannuation fund by changing the risk factor you’re prepared to accept.
If you don’t mind managing your super fund, consider setting up a self-managed superannuation fund. Having control over your super fund is cost-effective and allows you to make customized investments. Most people who go this route tend to invest their super funds in commercial property.
- Make extra contributions
Wherever possible and depending on your financial circumstances, consider making additional contributions to your superannuation fund. Even small, regular contributions over your career can have a huge impact on your retirement savings in the long run.
Make your additional contributions tax-effective by asking your employer to make them on your behalf. You can also contact your fund and make your own direct contributions if that’s not possible.
You might not notice the effect of topping up your super right away but once the power of compounding kicks in, you’ll certainly reap the rewards.
- Get a side hustle
Don’t just accept one stream of income. Look for more ways to make money. Whether you’re driving an Uber or selling stuff online, there are plenty of ways to start a side hustle that’ll increase your cash flow so you can channel more funds to your super.
- Do your research
Try and find out more about your super to make sure you’re not getting ripped off. You might have multiple accounts and paying fees on all of them without even knowing it. It only takes about half a day to do this type of research, yet it could save you a ton of money in charges and payments.
- Look at your perks
Get to know your super fund and what they offer. Most funds offer courses on investing, events, book clubs and other value-added services designed to educate you about your super. Be sure to take part in these opportunities so you can stay abreast of developments and make the most out of your super fund.
A superannuation fund is a great nest egg basket that when handled properly, can lead to a comfortable retirement. The earlier you start investing in your super fund, the more you’ll get out of it. We hope you’ll apply some of the strategies outlined in this article to maximize your investment.