Lifestyle is a very personal thing; luxury living for one person is a modest existence for someone else. Life seems to be easy and going smoothly when one is strong enough and can earn his own livelihood. But when one grows old, becomes weak, then what???
Hearing this big word, one gets really confused. What is it? Or what does it deal with? To explain it in a simple language, we can say: âEURoeSuperannuation fund is the most tax effective vehicle for your retirement wealth. It is a particularly useful investment vehicle you can use to accumulate wealth to fund your lifestyle when you retire, while benefiting from some excellent tax advantages.
When it comes to define the term, it goes on in this manner: The terms retirement plan or pension or the word superannuation refer to a pension granted upon retirement.
Every country has got one or the other superannuation plans for its employers among which the superannuation plan in Australia offers the best one. Aussie Super is a multi-industry fund, where they can take care of your entire superannuation fund and manage your accounts in a quite flexible way.
Superannuation in Australia refers to the arrangements which people make in Australia to have funds available for them in retirement. In Australia like Aussie Super, superannuation arrangements are also government-supported and encouraged, and minimum provisions are compulsory for employees. For example, employers are required to pay a proportion of an employee’s salaries and wages (currently 9%) into superannuation funds, but people are encouraged to put aside additional funds into superannuation.
As superannuation is money invested for a person’s retirement, strict government rules prevent early access to preserved benefits except in very limited and restricted circumstances, including severe financial hardship or on compassionate grounds, such as for medical treatment not available through Medicare. There are seven main types of superannuation fund:
Generally, superannuation benefits fall into three main categories:
Preserved benefits;
Restricted non-preserved benefits; and
Unrestricted non-preserved benefits.
Preserved benefits are benefits that must be retained in a superannuation fund until the employee’s ‘preservation age’. Currently, all workers must wait until they are 55 before they may access these funds. All contributions made after 1 July 1999 fall into this category.
Restricted non-preserved benefits although not preserved, cannot be accessed until an employee meets a condition of release, such as terminating their employment in an employer superannuation scheme.
Unrestricted non-preserved benefits do not require the fulfilment of a condition of release, and may be accessed upon the request of the worker. For example, where a worker has previously satisfied a condition of release and decided not to access the money in their superannuation fund.
There are about 500,000 superannuation funds in operation in Australia. Of those, 362 have assets totalling greater than $50 million. Four main regulatory authorities look after their allotments of funds in Australia. Thus superannuation fund is the best way to earn a healthy income after retirement and live a respectable life. The Australian way should be replicated world around in different countries for a perfect retirement plan.