What the super guarantee increase means for you

Jun 12, 2023

The latest SG increase is good news for Australian workers receiving super. The SG rate will also continue to gradually rise by 0.5% each year until it reaches 12% in 2025.
These small increases can make a big difference in the long run. It means you could save more for your retirement without working longer.

Looking at the numbers
Let’s take the example of Ahmed, who’s 25 years old and new to the workforce. He’s just graduated from TAFE and started his first job. He’s earning $78,000 (before tax, excluding SG).
If Ahmed works until he’s 67, with no career breaks, and the SG rate stayed at 10.5% he would have $518,000 in super when he retires.
With an SG rate rise to 11% from 1 July 2023, he will have an extra $26,000, and a balance of $544,0001.
So while half a percent increase might not seem like much now, it can make a significant difference to your long-term super balance.

Check you’re getting the increase
From 1 July 2023, your employer is required by law to pay a minimum of 11% into your super account. It’s a good idea to check your super account or pay slips to see that you are being paid super at the new SG rate. 

Currently, your employer can pay super each quarter, so you may not see an increase in your contribution until after the end of September 2023.

What if your employer isn’t paying the correct super amount?
If you don’t think you’re being paid the right amount of super, it’s always best to talk to your employer first. If you’re unable to resolve your unpaid super query, you can visit the ATO website to check whether you’re eligible for SG contributions, and for a step-by-step guide on how to recover missed or underpaid super.

In addition to employer contributions, your super can also grow through extra contributions you add to it during your working life*. 

The more you add, the better chance you have of achieving financial freedom in retirement and you might also qualify for tax savings.

To learn more visit: australiansuper.com/superannuation/make-after-tax-contributions

 

 

 

*Before adding to your super, consider your financial circumstances, contribution caps that may apply, and tax issues. We recommend you consider seeking financial advice.
 Assumptions: Investment return is 6.5% a year, net of fees and tax, salaries increase at 3.5% a year, and retirement age is 67. The amounts are shown in today’s dollars. The case study is provided for illustrative purposes only and isn’t a representation of the actual benefits that may be received or the fees and costs that may be incurred. The projection is only an estimate and isn’t a guarantee.
This information may be general financial advice which doesn’t take into account your personal objectives, financial situation or needs. Before making a decision about AustralianSuper, you should think about your financial requirements and refer to the relevant Product Disclosure Statement available at australiansuper.com/pds or by calling 1300 300 273. A Target Market Determination (TMD) is a document that outlines the target market a product has been designed for. Find the TMDs at australiansuper.com/tmd.
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