I'm super sad. How do I plan to save her this year

Just $1 invested when super-mandatory started 30 years ago is now worth $7.67, based on the average “balanced” fund, SuperRatings says.

Don’t forget all super refund figures have been deducted by fees. Make sure, if you’re paying higher than 1.1 percent of SuperRatings’ name as a “regular fee,” that the fund you choose is performing well enough to justify the additional fee.

Get the best investment mix

Do what I did and avoid watching your superfund balance plummet – as long as your fund investment options are right. It should not be determined by what happens in the stock market, and always by what happens to you.

Of the types of funds I cited above, “growth” funds hold between 77 and 90 percent in equities, making them quite vulnerable to stock market volatility. “Balanced funds” hold 60 to 76 percent of the more moderate shares.

There are also more conservative options, especially for super members who are nearing retirement and can’t afford to risk their sizeable cash pile. This includes “stable capital” funds, which have 20 to 40 percent invested in equities.

It is your age and your level of risk aversion that should determine the appropriate fund investment options.

With plenty of time and temperament to ride a stock market recovery, I’m happy with my mix of aggressive investment options reflecting the stock market (via index tracking), plus a “balanced” core in my super fund.

Collect what is owed

You should have just gotten a 0.5 percent “raise”, with your employer super-mandatory increased from 10 percent to 10.5 percent starting July 1.

Luckily, the rule that required people to earn $450 a month from one employer before they were eligible for a super has been removed. This is especially good for parents who are returning to work gradually, perhaps with some odd jobs, after raising children.

soup contribution

At children’s expense, in super terms, it’s pretty big. The Australian Pension Fund Association says men retire with an average of 26 percent more in their super funds than women — $154,453 versus $122,848.

However, the bias baked into our super system is not just time out of a paid job to have a family, but also the fact that it is based on pay, when there is a persistent gender pay gap – still at 14 percent today.

A tally by the Finder shows that women can remedy this shortcoming by putting into their super-funds an additional $236 each month (based on men’s salaries of $84,521 and women, $60,679). This is important. Don’t forget women often live about four years longer than men.

My ‘New Year’s resolution

Don’t forget that you have an annual superconcession limit of $27,500, including employer contributions, the amount forfeited paychecks, and any additional contributions you may make that you claim as tax deductions.

However, you can also increase your super by removing the unused contribution limit for several years.

Claim it for free

There are two annual prizes you shouldn’t miss, if you qualify.

Load

The first is the partner’s contribution.

If the higher-income spouse contributes $3,000 after taxes to the spouse’s income super fund for less than $40,000 a year, they receive a tax offset of up to $540. That makes it very valuable in the super and tax fields.

The second is the opportunity to be super “free”.

As long as someone earns — less than $57,016 this tax year — and puts $1000 after taxes into their super fund, that would cost the government as much as $500 on it. This is called a super-contribution, and will only cost you about $19 a week… for an instant 50 percent return.

Remember, with stocks now for sale, offers abound. So any extra contribution you can make to your super will brighten up your future.

• The advice given in this article is general in nature and is not intended to influence the reader’s decisions about investments or financial products. They should always seek their own professional advice which takes their own personal circumstances into account before making any financial decisions.

Nicole Pedersen-McKinnon is the author of How to Get Mortgage-Free Like Me. Follow Nicole on Facebook, Twitter or Instagram.

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