How to Boost Retirement Savings and Ensure Access When you Choose to Retire

14 April 2015

While the recently released Tax Discussion Paper and Intergenerational Report created much needed debate around potential reforms of the superannuation system, a number of suggested changes may cause confusion among Australians when it comes to their retirement strategies.

This is the view of Centuria Life General Manager, Neil Rogan, who says Australian investors need to consider their options and, be aware of the potential impacts any changes to the superannuation regime may have to their investment strategies for retirement.

“Recent discussions around the superannuation system have been healthy and the Tax Discussion paper released last week shows that reform of the superannuation industry is on the agenda, however, this may create increased uncertainty in people’s minds about their strategy for retirement.

“At the end of the day, if there are changes to the way super is taxed and when you can access it, those who only invest within their super fund may need to look at alternative options and consider the costs and benefits of holding investments outside of superannuation.”

Mr Rogan noted that the Tax Discussion Paper shows that around 300,000 Australians are expected to move into the second highest tax bracket over the next two years and in 10 years’ time half of all tax payers will be in the top two brackets.

He also said another key area of reform on the table, which could impact people’s future investment strategies if implemented, is whether the superannuation access age should increase to 70 years old in line with the Age Pension.

“If the access age increases it may disadvantage those who have the means to retire at 65 by taxing early withdrawals. It may also impact how much you can withdraw at 60 and how much you can use as an income stream.

“Superannuation has been promoted as a fantastic way to increase retirement savings, however we are finding that some investors are giving consideration to diversifying into other potential investments they are able to access more easily when they want to retire”.

Mr Rogan concluded by saying that Centuria welcomes the current debate around super but reminded Australians to take a holistic investment approach and identify and assess options that may be appropriate for you for investing outside of super to potentially boost retirement savings and align it with the date you may want to retire.

Whilst investments outside of superannuation will each have differing taxation rates, investments like shares, property and life insurance investment bonds held outside of superannuation should be considered in a holistic investment approach,” Mr Rogan said.

For more information or to arrange an interview, please contact:

Neil Rogan
General Manager
Investment Bond Division – Centuria Life Limited
Phone: 02 8923 8948
Email: neil.rogan@centuria.com.au

Kate Bailey
Consultant
BlueChip Communication
Phone: 02 9018 8606/0421 986 328
Email: kate@bluechipcommunication.com.au

Heather Romao
Head of Communications
Centuria Capital Limited
Phone: 02 8923 8914
Email: heather.romao@centuria.com.au