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December 2013

New Year's resolution: Getting your super together

Many of us start off a new year by setting ourselves some goals, or resolutions, to achieve in the year ahead. One simple thing you can do this year to ensure your super savings don’t slip away is to find any lost super that you may have and get it together. It’s more straight forward than you think and with recent Federal Government changes, it may be better to do this with the APSS sooner rather than later.
There are billions of dollars in lost super waiting to be claimed in Australia. Some of it may even be yours! You can reclaim your lost super in three easy steps:

1. Find your lost or unclaimed super

If you’ve changed jobs, moved house or even changed your name then you may have lost track of your old super. Don’t let your super savings slip away. You can search for your lost super now by using the ATO’s online tool SuperSeeker.Opens in new window
This tool searches the ATO’s Lost Members Register and other ATO records, such as unclaimed super money, for your lost super accounts. You can also use the ATO’s phone service (13 28 65). As an added incentive to find your lost super; if you don’t track down your lost super, it could end up in the bank account of the Federal Government!

2. Consolidate your super savings

Once you’ve found your other super accounts, you may want to consider getting it all together into your APSS account. Some of the benefits of consolidating your super savings may include:

  • paying one set of fees and charges,
  • having less paperwork to deal with each year,
  • having flexibility with your investment options.

Combining your super is easy - just fill in the Rollover Form for each super account you want to combine with the APSS. You can download a form from the Publications & Forms section of the website at apss.com.au, or call SuperPhone on 1300 360 373 for a copy to be mailed to you.
Before rolling your accounts over though, it’s important to consider any exit fees, changes to your insurance cover or loss of benefits or investment options that may result from closing your other super accounts.

3. Save

Once you are reunited with your lost super, the more it is likely to grow. This is because the longer super is invested, the more it could benefit from compound interest. Furthermore, rolling over into the one account in the APSS could potentially save you fees and help you readily keep track of your super savings.

September 2013

Keep an eye out: Potential changes to super

Following the change in Government after the Federal Election in September 2013, there is the possibility of minor changes to the Federal Government’s superannuation policy.

Some developments since the Election, along with key aspects of the Coalition’s pre-election policy on superannuation, are summarised below.

  • Two-year pause to Superannuation Guarantee (SG) rate increase - Consistent with the Coalition’s pre-election policy, the Government has released for consultation draft legislation to maintain the current minimum SG rate of 9.25% for the 2014-15 and 2015-16 years. However, the Treasurer has said that the Government will not overturn the gradual increase in the SG rate to 12% following this two-year pause.
  • Superannuation Incentives for Low Income Earners - The Government has released for consultation draft legislation to repeal the Low Income Superannuation Contribution. The Coalition’s pre-election policy also foreshadowed that other current incentives for lower income earners, such as super co-contributions, would be reviewed once the Federal Budget returns to a strong surplus.
  • Concessional Contribution Caps - The Coalition’s pre-election policy proposed a review of the current concessional contribution caps once the Federal Budget returns to a strong surplus.
  • Minimum Pension Payments - As part of the Coalition’s pre-election policy, a review of the minimum pension payment levels would be conducted in view of current financial market conditions to ensure that these levels remain adequate and appropriate.
  • Implement Process For Excess Contributions Breaches - The Coalition’s pre-election policy stated that the Government would work with the superannuation industry to develop a process to address unintentional breaches of the contribution caps where an individual can show that their mistake was genuine and the error would result in a disproportionate penalty (noting that the previous Government’s recent amendments only extend to before-tax contributions, not after-tax contributions).

We will continue to keep you updated on what the new Government has in store for super, and how it could affect you.

September 2013

Getting ready for retirement

Have you ever thought you’d like to ease into retirement, without having to retire completely?

If you’re currently 55 or over and still working, an APSS Pre-Retirement Pension (or ‘PREP’ for short) can in the lead up to retirement:

  • Offer access to your super while you’re still working
  • Help you build your super, and
  • May provide a tax-effective option to boost your income.

What is a PREP?

A PREP allows members aged 55 or over, access to some of their super in the form of regular pension payments (similar to a salary) without having to stop work or retire permanently. This is provided you have reached your ‘preservation age’, which is generally between the ages of 55-60 depending on your date of birth. If you are under age 65 and still working, you can withdraw between 4% and 10% of your pension account balance each financial year. Note that this is based on current legislative limits which are subject to change in the future.
To learn more about how a PREP works and the eligibility rules that apply, please refer to the APSS Pensions PDSOpens in new window available at apss.com.au or by calling SuperPhone on 1300 360 373.

What are the benefits?

A PREP can enable you to:

Cut your working hours and maintain the same take home income level
Starting a PREP could help you by enabling you to reduce your working hours without reducing your take-home income level. You can work part-time and supplement your salary with income from your PREP account. You could receive the same take home income level using this approach.

Boost your retirement savings and take advantage of tax concessions
A PREP allows you to contribute extra to your super from your before-tax salary (i.e. salary sacrifice) while at the same time receiving income from your PREP account. For most people aged 60 and over, both before-tax contributions to super and pension payments from a PREP account will be taxed at a lower rate than their salary. Any tax savings could then be used to boost your super.

Boost your income if you want to keep working full time
Income from a PREP account can supplement your current salary and can be used for other investments or to spend as you wish. Be careful however, of using super savings that you’ll need in retirement.

How do I decide if a PREP is right for me?

Before you open a PREP account, you need to consider if this type of income stream is right for you and how it fits with your work, retirement and super plans. Some things to consider:

  • What are your priorities now, as you get closer to retirement and beyond?
  • How much income do you need now and in retirement?
  • Will your super last you long enough?
  • Will the income from a PREP account affect your or your partner’s social security and other Government entitlements?
  • How tax effective is a transition to retirement strategy like the APSS PREP account for your situation?

Get advice

A transition to retirement strategy can be complex and whether it is the right option for you will depend on your personal situation. We strongly recommend that you seek licensed financial advice that is tailored to your individual financial and tax situation, objectives and needs before starting a PREP account in the APSS.

June 2013

Keeping your money in the APSS

You can retain your super in the APSS and enjoy the benefits of remaining an APSS Member even after you leave employment.

If you leave your job at Australia Post or an Associated Employer, you can continue to enjoy the benefits of APSS membership by opening an APSS Rollover Account. This option is also available to your spouse if they have a Spouse Account in the APSS. To keep your super or your spouse’s super in the APSS after you leave employment, all you need to do is simply let us know within 60 days of the APSS writing to you after you cease employment. You will also need to read the current Member SavingsOpens in new window Product Disclosure Statement (PDS) and complete and return the required forms.

March 2013

A new Chairman for the APSS Board

The APSS Trustee is pleased to announce the appointment of Mark Birrell as an independent director and its new Chairman, effective from 1 April 2013. After serving as a Non-Executive Director on the Board of Australia Post from 2003 to 2010 and also as a Director of the APSS Trustee from 2006 to 2010, Mark is very familiar with the APSS.

He brings a wealth of knowledge and significant strategic experience to this position.

The appointment follows the retirement of the current Chairman, Len Early, after 13 years of dedicated and loyal service. Len will serve as a consultant until the end of the 2013 financial year, to assist Mark and the Board with the transition.

After steering the APSS through volatile times during the GFC, Len leaves the fund in a solid position and with Mark at the helm, well positioned to build on our successes and manage the challenges ahead.

March 2013

Don't be the victim of a super scam

An offer to help you get access to your super early might seem like a great idea, but you could end up losing your life savings.

Super is money for your retirement and not money that you can access legally before the ages of 55 to 60, depending on your date of birth. There are exceptions in circumstances such as terminal illness, permanent incapacity or where an early release is approved on limited severe financial hardship or compassionate grounds.
So, if someone is trying to convince you that they can help you access your super early, watch out! Be very wary of:

  • Advertisements promoting early access to your super.
  • Schemes that promise you a quick and easy way to access or ‘unlock’ your super.
  • Offers to ‘take to control of your super’.
  • Schemes that offer high, quick returns and sometimes tax-free benefits before age 60.
  • Unlicensed operators that claim to be qualified financial advisers.

Promoters of illegal super scams often target people who are in financial distress. If you are experiencing financial hardship, please contact SuperPhone on 1300 360 373 to discuss the options available to you.

How does a super scam work?

A typical super scam involves someone posing as a financial adviser who might ask you to sign over your super to a self-managed super fund (SMSF), and then they will transfer the money to you, less a commission. Except that often they don’t, and your money can be lost forever.
To add to the pain of this, you may face significant tax and/or penalties under tax laws for the illegal withdrawal from your super.
If you have been approached about accessing your super early, you should report it to ASIC by calling 1300 300 630 or the ATO on 13 28 61. You should also tell your friends and family to protect them.
What you can do to protect yourself from scammers

  • Use your common sense. Do not let anyone pressure you into making decisions about your super money or investments.
  • Get independent advice. Speak to a financial planner and make sure they are licensed by ASIC. You could also seek advice and information from a lawyer, your employer or union representative.
  • Don’t give out your personal details. Be sure to keep your super information secure at all times.
  • Check out the scam section on ASIC’s MoneySmart website. It includes a list of people that ASIC has taken legal action against for promoting these scams. Go to moneysmart.gov.auOpens in new window