Superannuation

Superannuation is an excellent way to invest money for your retirement. Your retirement savings grow because money is paid in regularly, which your fund invests at low rates of tax. Superannuation savings are usually made through trust funds and if these funds meet prescribed government standards they are eligible for tax concessions. In summary, it is particularly tax efficient to accumulate superannuation benefits in your spouse's name if s/he does not already have significant superannuation benefits. The only downside is that the benefits are preserved within the superannuation environment and can only be accessed when you retire. However, there are exceptional cases where you may be able to use the superannuation funds before you retire. So, it's a win-win situation for you.

Exceptions to Superannuation Funds...

As seen earlier, contribution to the superannuation funds is a compulsion for all the employers, which is also known as the superannuation guarantee. But employees who are below 18 years of age and do not work for a certain number of hours can be easily excluded from the superannuation funds. Hence, it's not compulsory for the employer to start a superannuation fund for all his/her employees.

Superannuation Fund Types...

Since the start of the superannuation scheme, a lot of money has been invested in this particular fund. There is not one, not two, but in fact, six different types of superannuation fund that your employer can invest in. It all depends under which category you come under.

• The first one is known as the Industry Funds. These funds are basically multi-employer funds, which are run by various employer associations and such unions as Cbus.
• The second one is called the Wholesale Master Trusts. Like the industry funds, these superannuation funds are also multi-employer funds. They are basically run by several financial institutions for various groups of employees. These funds can be known as Retail Funds as well.
• The third kind of superannuation fund that you will come across are the Retail Master Trusts/Wrap platforms. These funds are meant mainly for individuals and are run by various financial institutions.
• The fourth superannuation fund type is Employer Stand-alone Fund. These are basically started by the employers themselves and are different for each individual. Hence, in these kinds of funds, the employees have a choice of superannuation funds and can select the ones that suit their needs and salaries or wages.
• The fifth type of superannuation funds are the Do-It-Yourself Funds or something called as the Self Managed Superannuation Funds. These funds are basically for individuals that are less than five in a group.
• Last, but not the least are the Public Sector Employees Funds, which are essentially established by the governments for the government employees.