Questions To Ask Yourself About Your Super In 2020

For most of us, thinking about superannuation is fairly low down on our to-do list, particularly when there are all sorts of urgent things needing attention from week to week. However, if you want to be a money-smart woman and have enough money to live comfortably in later years, it’s a topic that deserves attention.

Women need to take control of their finances from every angle, with superannuation being just one. Keep in mind, too, that women typically live longer than men yet have smaller superannuation savings, so you don’t want to end up caught out in your retirement years with too few funds to live on.

While you need to discuss all the detailed ins and outs with professional advisors, such as accountants and financial planners, here are some questions to consider as you make plans for your future and think about what financial freedom for women means to you.

How much money will I need to retire?

Everyone has very different life goals and makes different lifestyle choices, which means that the amount one person needs to retire on can be in stark contrast to what another requires. However, the Association of Superannuation Funds of Australia (ASFA) researched this topic and came up with some numbers for people to use as a guide.

To comfortably live, ASFA studies noted that, on average, a single person of around 65 years of age would need about $44,000 per year to spend, while a similarly-aged couple should be okay on about $60,000. This equates to having around $545,000 saved up for a single and $640,000 for a couple, assuming superannuation withdrawal as a lump sum, and you can receive a part Age Pension. This kind of budget should let you afford to buy household goods, travel occasionally, participate in various recreational pursuits, pay for decent health insurance, and have a mid-range car.

Do note, though, that these calculations don’t take inflation into account, which can lead to big changes in values of money over the long term. The numbers also don’t factor in funds for significant retirement purchases, such as a caravan or boat.

To work out what money you need saved by the time you retire to have the lifestyle you hope for, decide on your ideal annual amount, then work backward from there. Once you know what the total amount you’ll likely require, you’ll see how far you still need to go, savings wise, and you can make a more concrete plan of attack to grow your superannuation.

Is all my superannuation in the one spot?

Another important thing to check is, if all your superannuation money is consolidated into one account, or if it’s spread around in different funds, from various jobs you’ve had over the years. It’s wise to have it all together in a single fund, so you reduce the fees you pay to super funds for management.

If you’re not sure what superannuation funds you have or how much is in each of them, head to the Australian Tax Office’s (ATO’s) website for more details. There are links you can follow to have relevant information found for you, through a search service linked with the Government’s MyGov platform. Lost or unclaimed super may be held by super funds or supervised by the tax office as ATO-held super.

Does my super fund invest my money in ways I agree with?

Something not enough people consider when it comes to superannuation is where and how super funds invest client money. While you want to pay attention to the overall results your fund gets for its clients over time, it also pays to investigate which avenues and specific companies your super fund puts money into to get your returns.

Many women are shocked to discover that a lot of the country’s super funds actually get invested in fossil fuels, as well as companies that don’t have very good track records in things like sustainability, workplace safety, worker rights, the treatment of animals, and other key issues.

As such, if you want your super invested in ways that align to your values rather than in opposition to them, start by finding out how your current fund works. If you can’t find the information easily, contact your super fund for all the details – this is the information you have every right to know.

Also, note that these days there are super funds set up specifically to invest money in a way that helps the planet, people, and animals, using client funds as a force for good. They do, though, vary in how they choose to operate and what they see as “good” or “bad”, so again, make sure you do your research to find the best fit for both your beliefs and your financial needs.