I’m a 44-year-old mum of two. I’ve taken a fair amount of time off to raise my two daughters and only now returned to work four days a week. I currently earn $75,000 per annum. I am making pre-tax (salary sacrificing) payments towards super at $300 per fortnight to increase my balance, which is currently $170,000.

I have recently had my home valued (which is completely paid off) at $1.6 million. Do you have any advice as to how I should further increase my super balance? Should I be contributing more than I am? I could probably stretch it and increase the payments to $500 a fortnight.

Women typically have lower super balances than men as they are more likely to take time off work to raise children.Credit: Simon Letch

Using the MoneySmart retirement calculator, with your current settings you are on track for a super benefit at age 67 of approximately $680,000. Plenty can change between now and then, but at present, at that point you would qualify for a part age pension, if not immediately upon retirement, then certainly within a few years as you use up some of your savings.

The combination of superannuation drawings and some age pension should ensure a comfortable retirement.

Increasing your salary sacrifice contributions to $500 per fortnight results in your projected balance rising to around $800,000, so it will certainly have a meaningful impact.

The balance to be found though is how much are you prepared to sacrifice now, for that extra level of financial security later in life?

Your daughters are with you for a limited window of your life. That extra $200 per fortnight going to super might instead be used for a family holiday that produces lifelong memories.

Other things to think about: be as aggressive as you can stomach with the investment choice in your super fund. You can’t touch the money for at least 16 years, so volatility is really of no consequence. But an extra 1 per cent return makes a big difference – that original $680,000 at retirement projection becomes $980,000.

QOSHE - I took time off to raise my kids. How do I get my super back on track? - Paul Benson
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I took time off to raise my kids. How do I get my super back on track?

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09.03.2024

I’m a 44-year-old mum of two. I’ve taken a fair amount of time off to raise my two daughters and only now returned to work four days a week. I currently earn $75,000 per annum. I am making pre-tax (salary sacrificing) payments towards super at $300 per fortnight to increase my balance, which is currently $170,000.

I have recently had my home valued (which is completely paid off) at $1.6 million. Do you have any advice as to how I should further increase my super balance? Should I be........

© The Sydney Morning Herald


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