Making the most of your super at every life stage

As a SASS scheme member, you have some great opportunities to safeguard your future through your benefit. To make sure you’re making the most of your scheme – while you’re working, as you retire and during your retirement years – it’s important to know what your choices are and the steps you can take to secure your financial future.  

In this article, we highlight some important decisions you need to make at different stages on your retirement journey, what you need to consider and where you can get extra information and advice.  
 

Before age 58

Maximising your super balance and SASS benefit 

When you’re still looking forward to a decade or more of working life, it’s well worth knowing what you can do to maximise your savings and income for retirement. After all, the more you have put aside for retirement, the more choices you have for how you’ll live.   

About your SASS scheme 

There’s two parts to your SASS scheme, each with options for boosting your retirement income:

• Your Personal Account: the total of how much you’ve contributed plus investment earnings and losses, less any costs. This part of your retirement savings is subject to market returns.
• Your Employer Financed Benefit: this is a defined benefit based on a points system.
  Both your contribution rate to your Personal Account and your length of service will determine how many points you accrue, up to a maximum of 180 points. Your Employer Financed Benefit isn’t affected by changes in investment markets.

Tips for maximising your Personal Account balance

Increase your personal account contributions: as SASS scheme member you can choose to contribute between 1% and 9% of your annual salary to your personal account. You can change your contribution once each year by sending your completed State Super contribution rate election form to State Super by 31 December. The new rate will take effect from 1 April in the following year

Look at salary sacrifice: salary sacrificing is a great way to reduce the amount of tax you pay on your SASS contributions. You can choose to pay 15% tax on your SASS contributions, instead of paying tax that you would normally pay with your employer, which could be up to 47%

Review your investment options: investment returns and losses can be an important factor in determining your Personal Account balance at retirement. You can choose one or more of the following four investment options:  

• Growth
  

• Balanced

• Conservative
  

• Cash
   

Each one comes with different levels of risk and potential returns so it’s important to consider your personal objectives and financial situation. You should also consider seeking professional advice from a financial planner.

* Includes 2% Medicare levy
 

Tips for maximising your Employer Financed Benefit

Catch up on points: for each 1% of salary contributed to your Personal Account each year, you’ll accrue 1 benefit point up to a maximum of 180 points. To maximise your employer-financed benefit, you need to contribute an average of 6% each year.

To find out how many points you’ve accrued, check the front page of your annual super statement or request a benefit estimate. If you find your accrued points are less than your maximum points, you can catch up by increasing your contribution rate to above 6%, with the maximum rate being 9%. 

For example: if you increase your contributions to 9% you can accrue 6 points, plus an additional 1 point for every 1% you contribute, up to 3 points.

Bear in mind that changing your contribution rate may mean you lose the special condition for SASS members, which deems all before-tax contributions to be within the cap limits. In fact, SASS will report only the amount up to the cap to the ATO. Members lose this special condition if they move to a higher benefit category than the category they were in on either 12 May 2009 or 5 September 2006.

To find out more refer SASS-Fact-Sheet-16-Contributions-caps-and-your-total-superannuation-balance.pdf

Things to consider

Before increasing your contributions to super, it's important to assess your current financial situation and work out how much additional money you can afford to contribute to your super. It's also vital to understand that money contributed to super typically cannot be accessed until you meet a condition of release, such as retiring and reaching the preservation age. If you can make it work, though, diverting extra cash into super contributions is one of the best ways to increase your retirement savings.
 

Get support for your super options

There are lots of resources we offer to help our SASS members stay on top of their savings for retirement and their benefit entitlements. You can also talk to us and get advice on your different options for maximising your whole SASS benefit.

Download this cheat sheet for some quick wins for your retirement planning
 

Age 59-65

Making the most of your super and deciding when to retire

There are all sorts of things that can influence your choice of when to retire. Health and family circumstances can definitely come into it but it also helps to know how to choose a date that works best for your SASS benefit. 
In this section you’ll discover information on your scheme to help you name the date for retirement and what else you can do to maximise your super when you’ve already reached 180 points for your Employer Financed Benefit.

Doing more with your super when you have 180 points

Once you reach 180 points, there are three ways to increase your SASS benefit before you retire:

1. Through salary increases: this will increase the amount of contributions to your personal account. These will also be included in your final average salary at retirement which is part of the calculation for your Employer Financed Benefit and your Basic Benefit which will continue to accrue along with your Additional Employer Contribution (if eligible). 
    

2. Positive investment returns on your Personal Account Balance.
    

3. Making a bigger contribution to your personal account, which can be up to 9% of your salary.
   
   Find out more about your options by watching our video on reaching 180 points.

Being informed about when you can access your SASS benefit

To be able to access your SASS benefits you’ll need to meet one of these conditions:

• Immediate access if you are totally and permanently incapacitated or terminally ill.
• Once you reach age 60 and and you have resigned from your SASS employer.
• From age 65 even if you are still working.
• At age 70 when you can no longer make contributions to the SASS scheme.

Maximising your final average salary

Your accrued points at retirement are one of the inputs that determine your employer financed-benefit. Another important one is your final average salary which is your salary on your exit date plus the salary reported by your employer on 31 December for the previous two years added together and divided by 3. Your final average salary is also used in the calculation of your basic benefit.

Knowing how this works means you can time your retirement to maximise the final average salary calculated. For example, if you are expecting a salary increase, it can be a good strategy to retire after the increase so that it is included in the calculation of your final average salary. 

Age 65+

Working beyond age 65

If you’d like to continue working once you reach 65, there are a couple of options for you to consider.

• You may choose to work beyond age 65 and if you haven’t yet reached 180 accrued benefit points, you can continue to contribute to the scheme up to age 70. 
   

• From age 65 you could choose to defer, rollover or cash out your SASS benefit, even while you are still working for your SASS employer. From that point, your employer would then commence making Super Guarantee contributions on your behalf to another super fund.
   

• You could consider rolling over your SASS benefit and commencing a retirement income account.
   

          Choosing a retirement income account: if you want to keep working  and  start receiving an income from your SASS

          benefit, you can look at opening a retirement income account. To do this you’ll need to roll over your SASS benefit into a super fund.   

The right strategy for you will depend on your situation and financial goals. You may consider seeking personal financial advice. 

Where to next?

Disclaimer

Issued by Aware Financial Services Australia Limited (ABN 86 003 742 756, AFSL 238430); wholly owned by' Aware Super (ABN 53 226 460 365).

Past performance is not an indicator of performance

General advice only. Consider if this is right for you having regard to your objectives, financial situation, or needs, which have not been accounted for in this information. Read the PDS and TMD before deciding to acquire, or continue to hold, any financial product. You should read the Financial Services Guide, before deciding about our financial planning services.