How much should I contribute?
The amount you contribute to your SAS scheme may depend on a range of factors including your income, financial commitments and other superannuation investments. However, while every individual's situation is different, there are a number of issues you should keep in mind.
- The more you contribute to your personal account, the more you receive from your employer (up to a limit of 180 benefit points).
- If you contribute an average 6% or more of your salary over the whole period of your SASS membership (based on a membership of 30 years), you will receive the maximum employer-financed benefit. If you were contributing just 2% of your salary, your employer-financed benefit would be one-third of what it would have been if you contributed at 6%.
- To achieve the highest available employer-financed benefit, you don't have to contribute at the same rate every year. You can contribute within the range of 1% to 9% each year and plan to accrue the maximum benefit points (an average of six points each year) over the term of your SASS membership.
- Maintaining your accrued benefit points at or above the 6% annual average during your membership will maximise the employer-financed benefit available if you exit the scheme early because of retrenchment, invalidity or death.
- Maximising your personal contributions optimises the employer-financed contribution to your final end benefit; however, it is important to consider the value of the personal contributions. Those contributions and the earnings on them can amount to a substantial sum when invested over the long term. Your Annual Benefit Statement will show the value of your personal contributions each year and the rate of return of the investment strategy you have selected.*
*Investment returns can be positive or negative
Watch your concessional contribution limits While there can be advantages to increasing your personal contributions, you need to ensure you don't breach Commonwealth Government regulations that restrict the amount of contributions that can be made to superannuation on a concessionally taxed basis. If you exceed these limits, you may pay additional tax. SASS Fact Sheet 16: Concessional Contributions Cap outlines these limits and explains the rules. To ensure your contribution strategy maximises your retirement benefit without breaking these rules, speak to your financial adviser or call StatePlus on 1800 620 305. |
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State Super Financial Services Australia Limited (SSFS), trading as StatePlus, is the holder of the Australian Financial Services Licence 238430, ABN 86 003 742 756. SSFS/StatePlus is a 'for profit' financial planning organisation wholly owned by the State Super Schemes as an asset held within the STC Pooled Fund. However, SSFS/StatePlus has its own Board and Management team which is separate from the State Super Trustee. State Super does not pay any fees to SSFS/StatePlus for the financial advice and member seminar services it provides to State Super members. State Super is not a representative of SSFS/StatePlus and receives no commission when making referrals to SSFS/StatePlus for financial planning or member seminar services. Neither State Super nor the New South Wales Government take any responsibility for the services offered by SSFS/StatePlus, nor do they or SSFS/StatePlus guarantee the performance of any service or product provided by SSFS/StatePlus.