Replies to post #23664 on A.I.M. Users Bulletin Board (AIMUSERS)

[AIMster]

re... Superannuation rules

A quick look 'round the 'net makes me think these are something like an Australian version of an IRA.

see:http://www.ato.gov.au/superprofessionals/content.asp?doc=/content/19132.htm

I'm sure Neil will fill in more details or let us know if it's more to it than that, but my curse is to be the son of a reference librarian so when an interesting question hits like this - BAM - off to Google I go! <grin>.

Best,

AIMster

[Neil Scott]

Hi Steve,

What we refer to over here as Superannuation is the equivalent of your retirement savings accounts.
I think they would be the equivalent of your 401k accounts.
Currently there is a compulsory 9% contribution by the employer that goes into your fund.
You have discretion of where or who invests these funds.

You can also "salary sacrifice" more of your earnings into the Super. This saves you a bit of tax, SS contributions are taxed at 15% rather than your marginal rate such as 30% or 45% depending upon your earnings.

Most people have very scant knowledge or care about their Super, especially when they are younger. It is only as they get older and the spectre of having no retirement savings looms that they take it more seriously.
I just stuff all my Super into a Vanguard High Growth fund as I want low cost and volatility and I'll let the dollar cost averaging do the rest.

Regards

Neil