Superannuation Home

Legal Definition of Superannuation

The Department for Families and Communities has this precise, rather official definition of Superannuation: It is a savings arrangement that operates primarily to provide income for retirement. Contributions can be made into a superannuation fund or retirement savings account (RSA). Superannuation funds are run by trustees who are responsible for investing your money with reasonable care and diligence. They have their own rules but complying superannuation funds must also follow Government rules which are designed to ensure all superannuation is properly managed. Simply put, it is a form of pension.

Superannuation is a pension scheme prevailing in Australia at the moment. In this scheme the employers need to compulsorily put aside a certain percentage of the employee's salary or wages in to something called as a superannuation fund. The percentage, however, does not remain the same and changes every time the superannuation laws undergo any changes. This amount that gets accumulated over a period of your working life can be accessed once you retire.

Superannuation Australia...

Although superannuation has been in existent since several years, it became compulsory only very recently; as recent as 1992. This happened due to the Keating Labor government. They needed to do something so that the people of Australia had some kind of an income when they retire. It was part of a huge reform package that looked in to the retirement income policies.

Accessing the Superannuation Funds...

As the superannuation funds are primarily for people who retire, the rules of accessing the superannuation funds before the actual retirement of an individual are rather stringent. However, in genuine circumstances the government may consider it and let you withdraw from your superannuation funds before you retire. The official retirement age of an Australian individual is currently set at the age of 55 years, especially if the contributions to the superannuation funds have been made after the 1st of July, 1999.

Superannuation Fund Choices...

Since July 2005, individuals have had the option of selecting the superannuation funds that suit their needs. Earlier, the employer may be investing in a common fund for all his/her employees. However, it is a known fact that a particular kind of investment may suit some while may not be ideal for another. Considering this fact, the Australian government decided to give the employees the choice and benefit from the money that is actually being invested for their future. After all, it is their money and they have the right to choose their investments.