There’s no universal approach to superannuation, however it can be helpful to focus on different milestones at each stage of your working life to continue increasing it. Superannuation is likely the longest-term investment you’ll ever have, therefore you do have time to take things slow and steady, not requiring immediate and large sum contributions.
The key to super is the regular and consistent contributions that you legally receive from your employer at each pay slip, as well as any additional contributions you choose to make.
Below we’ve listed some key points in your life and career and corresponding milestones.
When you’re a teenager
Superannuation is an important initial step in your working life, and although it may seem pre-emptive to be considering a plan for the end of your career when you’re really just starting, it can’t hurt to begin a rough understanding. Do some research to choose a fund that feels right for you.
For those who work through teenage years, by law employers generally contribute around 9.5% of your salary into your super fund if you earn more than $450 per month when you’re over 18 years old or under 18 years old working more than 30 hours a week.
During your 20’s
This is a good age to check on your super fund as working casual jobs throughout your teenage years may have seen you unknowingly open several superfunds. Consolidating your accounts can simply be done through the myGov portal and ATO website. At this age your full-time career may just be beginning therefore you’re unlikely to be making additional contributions yourself and will be relying on your employer.
According to amp.com.au, at age 20-24 the average male has $9,481 and female $8,051. In the age bracket 25-29, the average balance for men is $28,319 and $23,773 for women.
In your 30’s
A well-established career is what many will have achieved by their 30’s and after achieving raises, bonus’ and working yourself up the internal ladder, you’re likely being compensated with a higher salary than in your 20’s.
For many, this age group can coincide with many major life events, including marriage, babies and purchasing property. As your responsibilities increase, it becomes more important that you have personal insurance. Organising this sooner rather than later is ideal, as applying for them when you’re more mature and perhaps are dealing with health issues, you could experience rejection or push back from providers.
AMP lists the average super balance for those aged 30-34 at $58,035 for men and $45,968 for women. At 35-39 years old men typically have $92,425 accumulated in super and women have $72,098.
When you get to your 40’s
Well established in your career, likely in a more senior position, your 40’s are a time to consider long-term financial planning and working at chipping away at your accumulated debt. For most, there’s still a while to go in your working life prior to retirement, so there’s still opportunity to plan for your future and your family’s financial stability.
The gender divide becomes more obvious after having kids due to a variety of factors such as taking time away from work to raise children, taking extended career breaks and transitioning to part-time work to manage family life. If you’re concerned about this, rest assured that this gap can be recovered via salary sacrifice and lump sum contributions to top up your balance.
$134,992 is the average super balance for men aged 40-44 and $98,572 for women, according to AMP. Those aged 45-49 generally have $182,146 if they’re men and $127,687 for women.
By your 50s
In the lead up to retirement, you can begin investigating and implementing some investment strategies to allow you to continue earning when you cease working. Ideally by this age you’ve annihilated your accrued debt and have enough cash flow and savings to wave goodbye to the workforce either in your 50’s or as you head toward your 60’s. Whether this is looking into stock investment or purchasing property to rent out through a real estate agency or on Airbnb, retiring from the workforce or lowering your work load can allow a lot more time to be allocated toward creative financial pathways.
According to AMP, men aged between 50-54 have about $242,007 in super as opposed to women with $159,188. Men aged 55-59 have typically accumulated roughly $311,163 and women around $207,254.
Although you can’t go back in time and start thinking about superannuation earlier, there are multiple avenues and ways to increase your balance at each stage of your life. It’s worthwhile paying for some professional advice at any stage if you’d like to create a plan or get some trusted professional advice that you can trust.