Think HBR

Superannuation: Make it part of your wealth creation plan

Scott Douglas
SiDCOR Chartered Accountants
When it comes to superannuation most discussion centers around changes to the laws and the popularity of self-managed superannuation funds. I’d like to take the discussion back to the basics. Superannuation is fundamentally a mechanism to save for our future retirement. It is both tax effective and an incredibly valuable tool to maximise wealth as well act as a vehicle for many insurances including life.
For salary and wage earners, your employer is required to contribute an additional 9.5% of your salary to a superannuation fund on your behalf. This is your money. If you earn $70,000 a year as a salary, you in fact earn $76,650. Many people don’t see it this way though, and as such, don’t actively consider the value that this contribution brings to the wealth they will generate over their life time.
This is a common way of thinking, as people will focus on the dollar they have today over the dollar they can’t access until well into the future. The compulsory nature of superannuation however is effectively a forced savings plan that we have our entire working life, one that we will be thankful for once retirement is reached.
However, if you are a business owner and not on a wage, you won’t be required to contribute to super. With the mindset of a dollar in the hand is worth two in the fund, the lack of the compulsory nature that wage earners have means business owners may not be setting themselves up the way they need to for their future needs.
An exit strategy for your business can be critical in this case, where the sale of a business as retirement nears provides those much needed funds. Superannuation can then be considered as part of that exit strategy, as a tax effective tool to maximise the end game. However, it should also be considered a vehicle for accumulating wealth along the way, as the tax incentives can be significant, and can assist in reaching your goals.
Whether in business or an employee, don’t underestimate superannuation, make it part of your wealth creation plan today.
For further information contact SiDCOR on 1300 743 267, email or visit
Scott Douglas4 Scott Douglas
The CEO at SiDCOR Chartered Accountants, has over 20 years’ experience in accounting and taxation, having begun his career with international accounting firm KPMG. With extensive experience in a variety of industries and with all types of businesses from local entrepreneurs to national organisations, Scott is perfectly suited to provide solutions needed to minimise tax and maximise wealth. Scott has a Bachelor of Commerce from Newcastle University and is a member of the Institute of Chartered Accountants.