Salary sacrifice to become preferred method for super contributions
The abolition of the superannuation surcharge for high income earners heralds the demise of personal contributions to superannuation funds in favour of salary sacrifice, according to research conducted by Eureka Strategic Research in June 2005 for the Investment and Financial ServicesAssociation (IFSA).
IFSA senior policy manager Bill Stanhope worked closely with Eureka in conducting and analysing the research
He said: “People are saying, ‘the surcharge is gone so I’m going to switch back from undeducted contributions to salary sacrifice contributions because the tax advantage there is so much greater now.’”
The research gauged the behaviour and intentions of 305 randomly selected respondents from across Australia who earned more than $75,000 a year. The results indicated more than half of these respondents planned to make additional contributions to their superannuation in the next 12 months.
IFSA chief executive Richard Gilbert said 15 per cent of those surveyed who did not make contributions to super annuation in the last 12 months intended to make contributions in the next 12 months.
Recommended for you
Two commentators have shared why the inclusion of alternatives in a diversified portfolio shouldn’t be a simple switch with a traditional asset and will depend heavily on clients’ objectives.
Morgans chief executive, John Clifford, has announced he will step down from the wealth management group after eight years leading the business.
Funds under administration on the BT Panorama platform have passed $120 billion in the last six months as it progresses its migration of Asgard into the platform.
Private markets may be the hot topic of the day but two financial advisers have shared the red flags to consider and why advisers shouldn’t be tempted to invest solely in the pursuit of higher returns.
