making your retirement goals a reality your Retirement Guide CARE Super Pty Ltd (Trustee) ABN 91 006 670 060 AFSL 235226 CARE Super (Fund) ABN 98 172 275 725
your retirement is in your hands It can be difficult to know just how much you really need to enjoy your retirement years and often the wealth of information available is daunting. To help you assess your options, this guide takes a closer look at: How to review your current situation How much you might need to fund your retirement and whether you re on track Strategies to increase your retirement savings The government assistance available (such as the age pension), and A range of tools and resources to help you further. This guide is designed to assist you with your retirement planning, but obtaining personalised financial advice is paramount. A qualified financial planner will be able to develop a tailored retirement plan based on your specific needs, goals and situation. To find out more or book a call from a financial planner,* call 1300 360 149 or visit caresuper.com.au/advice. * Financial advice is offered through CareSuper s relationship with Industry Fund Services Limited (IFS), and is provided by an authorisation under the Australian financial services licence of IFS, ABN 54 007 016 195, AFSL 232514. The information provided in this document is general advice only and has been prepared without taking into account your particular financial needs, circumstances and objectives. You should consider your own investment objectives, financial situation or needs and read the Product Disclosure Statement prior to making an investment decision. You may also wish to consult a licensed financial adviser. Some products and services mentioned in this Retirement Guide are provided by third parties. The Trustee is not responsible for the products or services, views or actions of these third parties. Terms and conditions may apply which should be obtained from the third parties direct. The Trustee does not accept liability if loss or damage is incurred from the acquisition of third party products or services. Information current as at the date of issue and may change due to legislative or other changes. The superannuation planning calculators mentioned in this Guide, and available at caresuper.com.au, are provided by Industry Fund Services Limited (IFS) under its Australian financial services licence, ABN 54 007 016 195, AFSL 232514. Projections are based on information that you provide in addition to certain required assumptions which generate the projections. The projections are not guaranteed to be accurate or complete and CARE Super Pty Ltd takes no responsibility for errors or omissions. 2 caresuper.com.au
where to find what you need Section 1 Assess and plan Take a closer look at your current situation including how much you may need in retirement and whether you re on track. Go to page 4 Section 2 Increase your super and savings Prepare for your retirement with strategies to increase your savings, including suggestions on how to boost your super in a tax-effective way and things to consider when investing your money. Go to page 11 Section 3 Your options in retirement Find out more about the different options available to you once you are ready to retire, including account-based pensions and investments outside of super. Go to page 20 Section 4 Useful tools and resources Where to look to find more information, including financial planning, additional government support and helpful websites. Go to page 27 CareSuperLine 1300 360 149 3
Section 1 Assess and plan 4 caresuper.com.au
what are your retirement goals? Assess and plan What does retirement mean to you? Retirement means something different to everybody. For some, it s about having more time to relax with family. For others, retirement presents the perfect opportunity to travel and expand their horizons. Understanding what s important to you will help you plan to ensure you have the funds necessary to make your retirement goals a reality. Assess your situation Take the time to write down both your financial and personal goals for retirement. Once you have determined your goals, the first step to achieving them is assessing your current situation. This entails understanding how much you re spending, your savings and your level of debt. Simply looking at whether you are saving regularly or are living from one payday to the next can be an indicator of your financial situation. Take the time to write down the value of all your investments including your super balance and outline whether these have restrictions on when you can access them. To gain a better understanding of your situation, there are many tools available such as the Budget Planner available at moneysmart.gov.au. CareSuper offers access to superannuation planning calculators, which use cost of living estimates to help you gain a better understanding of what your expenses may be. The calculators will also show you whether you re on track to have enough money to fund your desired retirement lifestyle. Visit caresuper.com.au/ supercalculators. Once you know your goals, how much money you spend, what you are saving, your debt and investments, you can look ahead to how much you might need in retirement. CareSuperLine 1300 360 149 5
Government age pension One of the most common sources of income in retirement is the age pension. Eligibility for the age pension depends on your age, residency status and the income and assets tests. How much you receive is subject to the income you obtain from other sources, the value of your assets and other circumstances. Maximum payment rates for the age pension as at March 2015 Situation Single Couple Annual pension maximum $20,337.20 each $30,659.20 combined Take a closer look at the age pension, including how much you can receive and eligibility, on page 21. NB: These amounts exclude the Pension Supplement and the Energy Supplement, which you may receive as a fortnightly payment in addition to the base pension rate. These rates may increase in September and March every year in line with salary and price changes. case study Spending money in retirement Sally is 65 and is ready to retire. She has $250,000 in super, $5,000 cash in the bank and would like to spend $800 per week in retirement, but doesn t know if she can afford this. Sally would like to know how much she can afford to spend if she wants her retirement savings to last her to age 90, assuming she receives both the Government Age Pension and draws down her retirement savings. Take a look at the difference to how long Sally s super savings will last based on how much she spends each week in retirement below: Retirement savings (super and cash in bank) Proposed retirement spend per week $255,000 $800 80 years old $255,000 $690 90 years old Age at which her retirement savings will run out If Sally spends $800 per week in retirement, her retirement savings is estimated to run out when she turns 80 years old. However, if she spends $690 per week in retirement, her retirement savings is estimated to run out at age 90. Once her retirement savings runs out, Sally would be reliant on the Government Age Pension alone. Estimates are based on a 6.6% p.a. return on her super and an indexation rate of 3.50% p.a. The Government Age Pension calculations assume Sally has $5000 cash in the bank, $10,000 in contents and a car valued at $15,000. The estimates also assume Sally will retire at age 65, and spend 25 years in retirement (i.e. to age 90), after which time she will be financially reliant on the Government Age Pension only. Figures are in today s dollars, rely on assumptions and is an estimate only. All information used for the estimates are current at the time of production and are subject to change. Fees and/ or costs charged by any super fund (including CareSuper) have not been taken into account. Any changes to Government legislation may affect the estimates. These estimates should not be relied on as a representation of your actual future superannuation entitlements or benefits from any particular superannuation fund or product. Speak to a financial planner for projections specific to your situation. Case study figures produced under the Australian Financial Services licence of Industry Fund Services Limited ABN 54 007 016 195 AFSL 232514. 6 caresuper.com.au
Assess and plan How much will you need in retirement? The Association of Superannuation Funds of Australia (ASFA) estimates how much money most Australians will need in order to live a modest or comfortable lifestyle in retirement. This research shows that the Government Age Pension is often not enough to fund all of the expenses in retirement. This means it is likely you will need to supplement this with other income, depending on your desired retirement lifestyle. Modest lifestyle Comfortable lifestyle Single Couple Single Couple Total per year $23,438 $33,799 $42,569 $58,444 Figures from ASFA as at March 2015 and are based on the budgets and living standards of someone aged around 65. The figures in each case assume that the retiree(s) own their own home and relate to expenditure by the household. This can be greater than household income after income tax where there is a drawdown on capital over the period of retirement. Single calculations are based on female figures. Visit superannuation.asn.au for more information. Add a little bit extra It s a good idea to plan to have a little bit extra to fund your retirement. Especially because it s likely you ll need more money in some years than others, depending on your health and other expected or unexpected expenditure. CareSuperLine 1300 360 149 7
How long will your retirement last? Once you have a better idea of how much you might need for every year in retirement, the next step is to work out how long you will spend in retirement. This is where life expectancy comes into play. Your life expectancy is based on your gender and age. To estimate how many years you may be in retirement, subtract the age at which you plan to retire from your life expectancy. It s also a good idea to over-estimate your life expectancy. Fifty-nine percent of women and 43% of men outlived their life expectancy and lived to at least age 85 during 2010 2012.* * Source: Australian Bureau of Statistics Surviving from birth to age 85 table. example For example, a woman currently aged 55 is expected to live to 86. If she retires at age 60, she can expect to have 26 years of retirement (86-60 = 26). Male current age Life expectancy 40 52 82 53 60 83 61 66 84 67 70 85 71 74 86 75 77 87 78 79 88 80 81 89 82 83 90 84 85 91 Female current age Life expectancy 40 45 85 46 59 86 60 67 87 68 73 88 74 77 89 78 80 90 81 83 91 84 85 92 Source: Australian Bureau of Statistics Life Tables Australia 2011-2013. Rounded to the nearest whole year. 8 caresuper.com.au
When can you access your super? To access your super you need to meet a condition of release. Some of the conditions of release are: Turning 65 this is the age you can access your super even if you re still working. When you permanently retire from work and have reached your preservation age. Your preservation age is based on the year you were born. See the table below for further details. If you change employers after turning 60 (in some circumstances). Reaching your preservation age and are still working as part of a Transition to Retirement plan. (Refer to page 16 for further information.) Assess and plan Preservation age Your date of birth Minimum age you can access your super Before 1 July 1960 55 1 July 1960 30 June 1961 56 1 July 1961 30 June 1962 57 1 July 1962 30 June 1963 58 1 July 1963 30 June 1964 59 1 July 1964 or after 60 Extra help There are other entitlements you may have access to such as the Pensioner Concession Card. Take a look at page 31 for details. CareSuperLine 1300 360 149 9
a financial planner can help you plan for retirement Will you have enough? Now that you have assessed the retirement income you ll need to fund your lifestyle and how long you might need this for, will you have enough? If not, there are many strategies available to boost your retirement savings. Take a look at section 2 for an overview of some of your options. It s also important to speak to a financial planner to ensure your retirement strategy meets your needs. CareSuper members have access to financial planning through CareSuper s relationship with Industry Fund Services.* You can speak to an Industry Fund Planner at one of CareSuper s offices, online or over the phone. For further information or to arrange an appointment visit caresuper.com.au/advice or call 1300 360 149. some extra help CareSuper offers access to superannuation planning calculators, which can help you work out how much income you re on track for in retirement, and how long these funds might last. Visit caresuper.com.au/supercalculators to see your estimates. * Financial advice is offered through CareSuper s relationship with Industry Fund Services Limited (IFS), and is provided by an authorisation under the Australian financial services licence of IFS, ABN 54 007 016 195, AFSL 232514. 10 caresuper.com.au
Section 2 Strategies to increase your super and savings CareSuperLine 1300 360 149 11
strategies to increase your retirement nest-egg If you re not on track to meet your retirement goals don t worry there are steps you can take right now. Take a look at your options in the following pages. 1 Boost your super There are lots of different ways to build your super and you can consider one or a combination of these options depending on your situation: Before-tax contributions to super Before-tax contributions (also known as concessional contributions) are contributions from your pre-tax income including compulsory super guarantee contributions from your employer, employer voluntary contributions and salary sacrifice amounts. The advantage of contributing to super from your pre-tax income is that you decrease your assessable income for tax purposes, which may reduce the amount of income tax you pay, as the contributions to super are generally taxed at a lower rate. Refer to the table below for the possible tax savings when salary sacrificing to super (a before-tax contribution), based on the tax scales at 1 July 2014. Taxable income 2014/15 Marginal tax rate * Salary sacrifice (contribution tax rate) ** Tax saving achieved * $18,201 $37,000 19% 15% 4% $37,001 $80,000 32.5% 15% 17.5% $80,001 $180,000 37% 15% 22% $180,001+ 45% 15% (30% if income>$300,000)^ 12 caresuper.com.au 30% (15%) Source: www.ato.gov.au *Tax rates exclude the 2% Medicare levy. **Subject to total concessional contribution limits. ^For income over $300,000 the salary sacrifice contribution tax rate is $30%. This tax applies for the financial year ending 30 June 2013 and beyond. Visit ato.gov.au for further information. You may be able to arrange a salary sacrifice arrangement with your employer, where they automatically transfer funds into super from your pre-tax income. That way, your super will work for you in the background, but be sure you keep an eye on your contribution caps to minimise any additional tax.
Increase your savings After-tax contributions to super After-tax contributions are voluntary contributions you make to super from your take-home pay. You may also be eligible for Government co-contribution payments if you make an after-tax contribution. Making an after-tax contribution to super is easy with most funds offering the ability to top up your super using BPAY or via direct debit from your bank account. Government co-contribution scheme The co-contribution scheme was introduced to help low income earners increase their super and is a helpful way to save for retirement as Government co-contribution payments are tax-free. How much you receive from the government depends on your income and how much you contribute in after-tax contributions (conditions apply). Find out more about the co contribution scheme including eligibility criteria and how much you might be entitled to at ato.gov.au. you may incur extra tax if you exceed your contribution caps While there s no limit to the amount you can contribute to your super to keep building your retirement savings, there is a limit to the amount of contributions you can make without incurring additional tax. Take a look at the CareSuper Boost your super fact sheet at caresuper.com.au/boostsuper for the amount of before-tax and after-tax contributions you can make before you may incur a tax penalty. CareSuperLine 1300 360 149 13
case study The impact of contributing to super over time Amanda is 47 years old with a super balance of $50,000. She plans to retire at 47 years old. Amanda can afford to spare $5000 of her take home pay a year to boost her savings and is wondering the best way to do this. If Amanda contributes this $5000 a year (which is less than $100 a week) as after-tax contributions for 10 years, it is estimated that she will have an additional $2149 per year for the estimated 33 years of her retirement.* If Amanda makes a before-tax contribution and salary sacrifices $7407 (which is the equivalent of $5000 in take home pay per year) into her super each year for 10 years, it is estimated that she will have an additional $2735 per year for the estimated 33 years of her retirement.* Amanda s estimated super balance at age 57 $250,000 $200,000 $198,000 $212,000 $150,000 $141,000 $100,000 $50,000 $0 No extra contributions After-tax contributions Before-tax contributions * Based on an annual salary of $70,000 (with a 3.5% increase p.a.), 9.5% employer contributions, a $50,000 starting balance in super and an annual return of 7.3%. The calculations assume Amanda retires at age 57 and spends 33 years in retirement (which is to age 90), after which time she will be financially reliant on the Government Age Pension only. Figures are in today s dollars, rely on assumptions and is an estimate only. All information used for the estimates are current at the time of production and are subject to change. Fees, costs and/or insurance premiums charged by any super fund (including CareSuper) have not been taken into account. Any changes to Government legislation may affect the estimates. These estimates should not be relied on as a representation of your actual future superannuation entitlements or benefits from any particular superannuation fund or product. Speak to a financial planner for projections specific to your situation. Case study figures produced under the Australian Financial Services licence of Industry Fund Services Limited ABN 54 007 016 195 AFSL 232514. 14 caresuper.com.au
Combine your super accounts If you have more than one super account you may be paying duplicate fees and costs which can deplete your retirement savings. By combining all your super into one fund you will avoid paying multiple fees and it may be easier to keep track of. The chart below outlines the difference having multiple funds could make to your account balance over just 5 years. Consider the effect of $50,000 invested over the past 5 years... $14,000 $12,000 $10,000 $13,792 $9,987 You could be more than $8,500 better off over 5 years by consolidating your super Increase your savings $8,000 $6,000 $4,000 $5,308 $2,000 $0 CareSuper 3 average industry funds 3 average retail funds Source: SuperRatings PTY LTD CareSuper consolidation modelling report 4 June 2013 Assumptions: Investment returns are based on actual returns over the past 5 years to 31 March 2013 using the CareSuper Balanced option and Not for Profit median and Retail Master Trust median provided by SuperRatings. Fee averages are based on accumulation products assessed by SuperRatings. Past performance is not a guarantee of future performance. CareSuper members can rollover their other super into their CareSuper account online with ease via MemberOnline. Alternatively, members can complete a Transfer your super form or use the online consolidation tool which will pre-populate the transfer forms for you. Please note that there are a few things to consider before you rollover, including any exit fees your other fund might charge and any insurance implications. Visit caresuper.com.au/combine for details. Many Australians also have lost super. You can search for any lost super you might have within minutes using CareSuper s lost super tool available at caresuper.com.au/lostsuper. All you need is your Tax File Number and date of birth. Work for longer Whether you decrease your hours or continue working at the same rate, delaying your retirement provides you with extra time to save and receive super guarantee contributions from your employer. CareSuperLine 1300 360 149 15
2 Transition to retirement A Transition to Retirement plan allows you to withdraw funds from your super while continuing to build your retirement savings. It offers the ability to: Reduce your working hours while maintaining your cash flow Decrease the amount of tax you pay, through salary sacrifice Maximise your super as earnings (such as interest, dividends and capital gains) are tax-free. There are two key components to a Transition to Retirement plan: 1. Transfer a proportion of your super to a Transition to Retirement Pension and withdraw this as an income. 2. Salary sacrifice to super to continue to build your retirement savings (noting your contribution limits) in a tax-effective way. Transition to Retirement plans are available to anyone who has reached their preservation age (see page 9 for details). CareSuper offers a Transition to Retirement Pension that can provide you with a flexible, tax-effective option as you approach retirement. For further information including full eligibility criteria, visit caresuper.com.au/ttr. You can also use the Transition to Retirement calculator at caresuper.com.au/supercalculators. case study Transition to retirement Jack is 60 years old and still working. He has $110,000 in his super account. By implementing a Transition to Retirement plan and salary sacrificing $16,562 a year to his super, Jack: Maintains his take home pay Reduces his total tax payable by $3278 Boosts his super by $28,008 over 6 years. No TTR strategy With TTR strategy Salary received $80,000 $63,438 TTR income received Nil $10,800 Total income $80,000 $74,238 Tax payable (incl. medicare levy) $19,147 $13,385 Total take home pay $60,853 $60,853 Contributions tax on salary sacrifice $0 $2,484 Super balance after 6 years $169,640 $197,648 Based on an annual salary of $80,000 (with a 3.5% increase p.a.), 9.5% employer contributions and a starting balance in super of $110,000, with an annual return of 7.3%. Figures are in today s dollars, rely on assumptions and are an estimate only. All information used for the estimates are current at the time of production and are subject to change. Fees, costs and/or insurance premiums charged by any super fund (including CareSuper) have not been taken into account. Any changes to Government legislation may affect the estimates. These estimates should not be relied on as a representation of your actual future superannuation entitlements or benefits from any particular superannuation fund or product. Speak to a financial planner for projections specific to your situation. Case study figures produced under the Australian Financial Services licence of Industry Fund Services Limited ABN 54 007 016 195 AFSL 232514. 16 caresuper.com.au
Increase your savings 3 Money management Good, old-fashioned money management with the aim of spending less and saving more can be a great way to boost your retirement nest-egg. Many Australians will live off a lower annual income in retirement so it can be a good way to slowly transition your lifestyle as well. Create a budget and highlight certain areas of spending that you can cut back on and consider making getting out of debt (if you have any) a priority. The MoneySmart website has relevant and easy to understand information on a range of areas including: Budgeting use the Budget Planner to see exactly where your money goes and get some great tips on how to create an effective budget Saving find out more about setting realistic savings goals and strategies to achieve these Managing debts take a look at the helpful tips to manage debt and where you can go for help. 4 Spouse contributions You can also boost your spouse s super and may receive a tax offset for making after-tax (non-concessional) contributions to your spouse s super account. You may claim an 18% tax offset (up to a maximum of $540 each financial year) if your spouse earns less than $10,800 p.a. and you contribute $3000 to their super account (subject to some conditions). This offset reduces at a rate of $1 for every $1 your spouse earns over $10,800 (up to a maximum of $13,800 where there is no tax offset). To find out more about eligibility criteria and the options available visit ato.gov.au. This information and more is available at moneysmart.gov.au. CareSuperLine 1300 360 149 17
5 Assess your investments in super It s important to assess your investments to ensure they align with your goals and timeframes. When you join a super fund and you don t exercise an investment choice you are placed in its default investment product. However, it s always best to check whether this option best suits your circumstances. Consider the level of investment risk you are comfortable with and your investment timeframes. By evaluating these factors and re-assessing them over time, you are better placed to ensure your returns meet your expectations. Below is an example of how investments can exhibit differing levels of risk and return. No matter what your investment choice, it is important to understand risk and return and how they relate to achieving your investment goals. Risk vs return This graph shows where CareSuper s Managed and Asset Class investment options sit on the risk vs return scale, taking into account each option s benchmark asset allocation. It is an indicative example only and assumes an investment period of at least 5 years. High Overseas Shares Australian Shares Direct Property Growth Alternative Growth Potential return Balanced Sustainable Balanced Conservative Balanced Capital Stable Capital Secure Fixed Interest Managed options Asset Class options Capital Guaranteed Low Risk High 18 caresuper.com.au
Increase your savings Need help assessing your investments? CareSuper members can speak to a financial planner* over the phone at no extra charge to obtain super-related investment advice. Your planner will ask you a series of questions to understand the level of risk you re comfortable with as well as your investment goals. This phone call is an easy way to ensure your super is working in the best way to meet your objectives and provides the perfect opportunity to ask any questions you might have. To find out more or arrange an appointment, visit caresuper.com.au/advice or call 1300 360 149. * Financial advice is offered through CareSuper s relationship with Industry Fund Services Limited (IFS), and is provided by an authorisation under the Australian financial services licence of IFS, ABN 54 007 016 195, AFSL 232514. CareSuperLine 1300 360 149 19
Section 3 Your options in retirement 20 caresuper.com.au
helping you choose the right options in retirement Options in retirement This section takes a look at some of the products and assistance available to you. The options you choose in retirement will depend on your personal needs and situation and that s why it s important to speak to a qualified financial planner. To help get you started, let s take a closer look at some of your options. 1 Government age pension One of the most common sources of income in retirement is the age pension. How much can I receive? How much you receive is subject to how much income you obtain from other sources (calculated using the income test) and the value of your assets (calculated using the assets test) as well as other circumstances. The maximum basic pension rates as at March 2015 are below: Situation Single Couple Couple separated due to ill health Pension rate per fortnight $782.20 each $1179.20 combined $782.20 each NB: These amounts exclude the Pension Supplement and the Energy Supplement, which you may receive as a fortnightly payment in addition to the basic pension rate. These rates may increase in September and March every year in line with salary and price changes. Eligibility for the age pension Age: Depending on the year you were born you will be eligible for the age pension when you reach 65 67 years of age. Residency: You must be an Australian resident and in Australia on the day that you lodge your claim. Assets: The value of your assets must not exceed a prescribed limit as calculated by the assets test. Income: How much income you receive or are deemed to receive must not exceed a prescribed limit. For further information and other conditions that may apply, visit humanservices.gov.au. CareSuperLine 1300 360 149 21
The information below looks at your options once you are in retirement. It does not relate to Transition to Retirement pensions (which you can take out before you retire). Refer to page 16 for further details on a Transition to Retirement strategy. 2 Account-based pension Account-based pensions can provide you with a flexible and tax-effective regular income to supplement your income from the Government Age Pension (if applicable). You can select the amount and frequency of your pension payments (within legislated limits). Your funds continue to be invested and you can select from a range of investment options to suit your needs and objectives. Benefits Tax advantages tax-free pension payments if you are 60+ No tax on earnings You nominate the frequency and amount of payments within certain legislated limits Provides a regular income and you can draw down payments to meet regular expenses Restrictions Funds are generally restricted until you meet a condition of release You must withdraw at least the minimum amount prescribed by the Federal Government each financial year You can only put money into your pension account once and these funds must come from super No insurance cover available Convenient access to your funds With an account-based pension you will receive regular payments from your pension account and can make lump sum withdrawals. Many super funds also provide online access to your account. While there is no limit to the amount you can withdraw from your pension, you must take out at least the minimum amount prescribed by the Federal Government, which is calculated based on a percentage of your pension account balance and your age. To view the minimum pension amounts applicable to you visit ato.gov.au. 22 caresuper.com.au
Options in retirement make the most of your retirement funds with us The CareSuper Pension allows you to convert your super into a regular income and make the most of investment returns. It offers: The flexibility to choose the frequency and amount of your payments (within legislated limits) and make lump sum withdrawals A range of investment options, including access to term deposits, exchange-traded funds, listed investment companies and securities on the S&P ASX 300 Index through the Direct Investment option (specific investment restrictions apply to this option) Tax-effective earnings and tax-free pension payments if you re aged over 60 A competitive fee structure where any profits are reinvested into the fund Online access to your account details via PensionOnline, our secure web-based online portal. Anyone who has full access to at least $10,000 of their super can open a CareSuper Pension. To find out more about the features and benefits refer to the CareSuper Pension Guide available at caresuper.com.au or call 1300 360 149. CareSuperLine 1300 360 149 23
choose an investment strategy that complements your overall goals 3 Money outside of super There are many investment options outside of super which you can select based on your needs. These options should complement your overall goals and provide a high level of diversification. Let s take a look at some of the options available to you: Property Property can be an advantageous investment thanks to capital gains and tax benefits that arise from negative gearing (if you have other income to offset) and other factors; however, as it is difficult to access funds from property quickly it can be restrictive. You may need to wait for the right time to sell, which may not always align with your retirement needs. By including property in a well diversified investment mix, the risks may be lessened. Shares Investing in shares can be a strong long-term investment plan. Shares can pay dividends which you can then reinvest to take advantage of compounding returns or use as income. Bank accounts Quick access to your money in case of emergencies is important not only when you retire, but throughout your life. Whatever your retirement strategy, it is usually prudent to have funds available as a safety net if the unexpected occurs. These funds can be placed in a bank account for convenient, quick access. Just remember that if these funds are just for emergencies, you should avoid temptation to dip into them for any other purpose. 24 caresuper.com.au
Options in retirement Managed funds In a managed fund your money is normally pooled together with other investors and is invested by an investment manager on your behalf. Managed funds offer the ability to diversify and take the hassle out of managing your investments, especially if you do not have the expertise yourself. Nevertheless, it is still important to understand how your money is being invested to ensure it meets your needs. It is also imperative to research the investment manager thoroughly along with their fees and charges to ensure your investment is not eroded by these. Fixed income annuities Fixed income annuities offer a guaranteed income over a specified period. To open an annuity you transfer a lump sum to the annuity provider who then pays you a regular income for a specified period. Generally there is a penalty for breaking the specified period and as such they are less flexible than income streams. If you are interested in an annuity it is best to do your research to select the type that is right for you. At present, there are only a few annuity providers in Australia. CareSuperLine 1300 360 149 25
take the time to assess all your retirement options Things to consider when assessing your investment options Diversifying your portfolio to strengthen its security and keeping an eye on your liquidity. The benefits of speaking to a qualified financial planner or taxation adviser to ensure your investment portfolio is tax-effective and meets your needs. How your assets outside of super might affect your eligibility for the age pension. Whether investments in super and outside of super complement each other. Do you have access to emergency funds just in case the unexpected occurs? Your personal objectives. 26 caresuper.com.au
Section 4 Useful tools and resources CareSuperLine 1300 360 149 27
useful tools and resources Would you like to find out more? There is a lot of information and assistance available. CareSuper website CareSuper s website, caresuper.com.au contains a range of helpful information as you approach retirement. Take a look today to find out more about the Transition to Retirement Pension and the CareSuper Pension. You will also find: Short online modules on various topics such as retirement, goal setting and estate planning A range of online calculators, which provide you with an estimated super balance projection and expected retirement income based on your situation (subject to some assumptions) Upcoming events and free seminars including the CareSuper Transition to Retirement seminars CareSuper s pension investment returns and awards The benefits of financial planning and what to expect from your first phone call or meeting with a planner Forms and publications including Transfer your super forms and the CareSuper Pension Guide PDS which outlines the features and benefits of our products in greater detail. Check out the range of helpful information available on our website 28 caresuper.com.au
Tools and resources Financial planning A qualified financial planner can help you assess your retirement options and develop a tax-effective strategy for you. CareSuper members have access to Industry Fund Planners.* There are different levels of financial advice available, which you can select based on your needs: Super-related advice at no extra charge You can obtain super-related advice at no extra charge over the phone on a range of topics such as investment choice, contribution strategies, insurance inside super and basic fund comparisons. Personal advice based on your needs You can also obtain more comprehensive advice, such as retirement advice including maximising the age pension and your other investments. During your first appointment your planner will help you determine your needs and objectives. No personal advice is provided and this appointment is free of charge. If you decide to continue with advice, your planner will provide you with a quote for services going forward. A financial planner can also help you with areas such as nominating beneficiaries to ensure your investments are protected and allocated based on your wishes. You can talk to a financial planner over the phone, from the comfort of your own home or workplace using our online meeting program, or at one of the CareSuper offices in Melbourne, Sydney or Brisbane. To find out more, arrange an appointment or book a call back from a financial planner, call 1300 360 149 or visit caresuper.com.au/advice. * Financial advice is offered through CareSuper s relationship with Industry Fund Services Limited (IFS), and is provided by an authorisation under the Australian financial services licence of IFS, ABN 54 007 016 195, AFSL 232514. CareSuperLine 1300 360 149 29
Education seminars Sometimes it helps to have your options explained to you in person. CareSuper holds free retirement planning seminars throughout Australia each year to help educate members on a range of financial matters. These seminars are a great starting point for anyone who is unsure of what they need to consider as they plan for retirement. Keep your eye out for upcoming seminars on the Events page under Maximise your super at caresuper.com.au. Online support Take a look at the following websites which include a range of helpful information: Website CareSuper caresuper.com.au and whyshouldyoucare.com.au MoneySmart moneysmart.gov.au Association of Superannuation Funds of Australia (ASFA) superannuation.asn.au The Department of Human Services humanservices.gov.au Australian Taxation Office ato.gov.au Some of the things you ll find Transition to Retirement and Pension products A range of super and retirement planning calculators Short online videos on a range of topics such as retirement and estate planning The services available through Industry Fund Services Ltd A range of online calculators, examples and tools including Budget and Retirement Planners How much you might need in retirement based on the ASFA Retirement Standards Details on the government age pension and other government assistance Current information and tax rates relating to super and investments as well as changes to legislation that may affect you 30 caresuper.com.au
Tools and resources Other government assistance Even if you don t qualify for the age pension, you may still be eligible for other types of support, including: Commonwealth Seniors Health Card, Low Income Health Care Card and/or Pensioner Concession Card Visit humanservices.gov.au for further information. Provides assistance with the cost of prescription medicines under the Pharmaceutical Benefits Scheme (PBS) and other medical services funded by the Australian Government, along with other concessions provided by state, territory and local governments. CareSuperLine 1300 360 149 31
we make it easy for you Issue date May 2015 1.5 t CO2-e Saved CareSuperLine 1300 360 149 caresuper.com.au By choosing to use Australian made ENVI Recycled carbon neutral paper for this newsletter, we have helped reduce global greenhouse gas emissions by more than 1.5 tonnes CO2-e. CR/RETIRE/GDE 941.0 05/15 ISS3