Inspirational Case Studies
Kevin, aged 60, TTR
The rules surrounding the Age Pension are constantly changing, making it difficult to know whether you are maximising your entitlements. This makes it essential to seek professional financial advice to help analyse your Centrelink entitlements so that you are not missing out on benefits you have every right to claim. The following case study illustrates what a difference this can make.
Kevin is 60 and wants to boost his superannuation savings before retiring at 65. Kevin earns a salary of $80,000. He wants to maximise his superannuation balance at retirement and has heard of salary sacrifice, but he doesn't want to sacrifice his current lifestyle. His current net income is $61,250 and he is not prepared to live on less than this.
A Seagrim's Financial Planner showed Kevin how he might be able to boost his superannuation savings by over $50,000 after just five years without giving up a single dollar of his current total income. Kevin has $300,000 in superannuation already, and is therefore able to draw down on the amount via a Transition to Retirement pension. His Seagrim's Financial Planner recommended that he salary sacrifice $40,853 per annum into superannuation in the first year.
|
|
Before strategy |
After strategy |
|
Taxable salary |
$80,000 |
$39,147 |
|
TTR pension payments |
Nil |
$26,850 |
|
Tax and Medicare |
($18,750) |
($4,747) |
|
Net annual income |
$61,250 |
$61,250 |
|
Amount contributed to super |
$7,200 (9% super guarantee) |
$48,053 (9% super guarantee plus salary sacrificed) |
|
Contributions tax |
($1,080) |
($7,208) |
|
Net package |
$67,370 |
$75,245 |
|
First year gain from strategy |
|
$7,875 |
After just five years, reinvest in super at a net earning rate of 7 per cent, Kevin would be $50,949 better off.
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