Superannuation 101: A Beginner’s Guide

Super Basics

Superannuation, often referred to as ‘super’, is a long-term savings plan designed to provide you with money to live on when you retire.

Your super grows through contributions made by your employer, yourself, or both. The money in your super fund is invested on your behalf by professional investment managers and, typically, the returns on these investments are reinvested, allowing your super to grow over time.

Understanding how your super works is important, as it’s a big part of your quality of life in retirement. Your employer is legally required to contribute a minimum percentage to your super – this financial year, it’s 11.5% – and this percentage will go up to 12% from 1 July 2025.

Boosting Your Super

While your employer will contribute to your super, you can also make your own contributions to boost your retirement savings. These can be before-tax (concessional) contributions like salary sacrifice, where you ask your employer to increase the amount of your salary that goes into super, or after-tax (non-concessional) contributions, where you put the money in yourself.

Concessional contributions are taxed at a lower rate within certain limits, making them an effective way to save on tax and increase your retirement savings.

It’s also worth looking into whether you’re eligible for government contributions, such as the super co-contribution scheme for low or middle-income earners.

And if you’re married, you might be able to split your super contributions or make contributions on your spouse’s behalf, which can have tax benefits.

You’ve already taken a great First step

You’ve already made a great decision in choosing First Super – a well-managed superannuation fund can provide significant benefits in the long term. It can offer financial security and a steady income when you retire, reducing your reliance on government pensions. The compound interest over time means that even small contributions early on can make a big difference to your final balance.

By regularly reviewing your super and making informed decisions about contributions and investment options, you can maximise your retirement savings. Remember, the earlier you start actively managing your super, the more you’ll potentially benefit.

Disclaimer: This publication contains general advice only and does not consider your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and read the Product Disclosure Statement (PDS) before making any decisions.