Commissions in Superannuation
The government may soon place a stop on commissions within Super. I’m left wondering if the Government thought this through properly. What happens when all the financial advisers go out of business? Who will feed them, the taxpayer?
How much super will you have?
Personally I don’t see many people who earn less than AU$55K using a financial adviser to give them superannuation advice. A taxpayer whose income is 55k will only get 9% super, which equates to AU$4,950. If you multiply this by 30 years, this equates to AU$148,500 by the time the average worker gives up work. When you consider government tax (currently at 15%) you can deduct another AU$22,275, based on the figure above. Reducing this rate by purchasing insurance (life insurance, etc.), will your super account support you in retirement?
The value in using a Financial Adviser
For those people who earn 80K plus, it could be worthwhile. Most financial advisers in Sydney will take around a 1-5%, (tax deductible to the super fund) annual fee from your super. For this you’ll get specialist, bespoke advice that could potentially boost your superannuation and leave you more comfortably positioned for your retirement, not forgetting Wealth Protection. I believe banning super commissions is a bad policy. The average Australian won’t be left with much super when it comes to retirement, and given that many Australians are already underinsured, and overcommitted financially, we could be looking at a whole generation facing a dire financial situation.
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Get financial advice today
If you have a question about your superannuation, or would like to speak to a Financial Adviser, call Australia Wide Tax Solutions in Leichhardt, Sydney on +61 (2) 8571 7300 or contact us.