Grow your super for your life after work
Queensland Teachers' Journal, Vol 128 , 21 July 2023, page no.23
Your new pay deal might be a good time to think about ways you can contribute extra to your super.
You can help grow your retirement savings by adding extra money to your super, perhaps by using your cost-of-living adjustment (COLA) payment if you choose.
The more money you save in your super during your working life means the more you may have for your lifestyle when you retire.
Along with your employer’s contributions, you can add money to help grow your super.
Learn more about growing your super:
Putting a little more into your super can make a big difference by the time you retire. You can grow your savings faster with the power of compound interest.
The longer you save, the more interest you could earn. And, by adding extra to your super, you might even be able to save some tax.
You can pay money into your super in two different ways:
- Making before-tax (concessional) contributions. An example of before-tax contributions you might like to consider includes salary sacrifice.
- Making one-off or regular after-tax (non-concessional) contributions. An example of after-tax contributions you might like to consider includes paying your cost-of-living adjustment (COLA) into your super.
What is the COLA?
Under the Queensland state school teachers enterprise bargaining agreement that will operate up until the end of June 2025, teachers will receive wage rises over three years of 4 per cent, 4 per cent, and 3 per cent.
The deal also includes a cost-of-living adjustment (COLA) payment to offset the rising cost of living. In each year of the three-year agreement, eligible Department of Education employees will receive a COLA payment if annual inflation is more than the wage increase that the government is paying for that year.
What are the contribution caps?
It’s important to remember, however, that there are some limits, or caps, on how much you can contribute to your super fund each year. If you go above these limits, you may pay extra tax, so it’s worth understanding how they work. It is also important to remember that any contributions made to your super are generally unable to be accessed until you retire.
Contributing too much to your super, or going over the cap, could mean extra tax.
- For before-tax contributions, the cap is $27,500.
- For after-tax contributions, the cap is $110,000.