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Increase on complaints for non-payment of life insurance by super funds March 5, 2014

Posted by Meike Suggars in Disability Insurance (TPD), Life Insurance, Personal Insurance, Superannuation.
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Life insurance payouts refused by super funds

As reported in Herald Sun 1 March 2014


Download the article here: Herald Sun article Super Headache dated 1 March 2014


Wealthy super now taxed May 21, 2013

Posted by Meike Suggars in Superannuation.
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Prior to the May Budget, the Gillard government announced one of its changes to super for 2013: its intention to start taxing the super of Australia’s wealthy retirees.

In this case, “wealthy” is defined as those with superannuation earnings over $100,000pa.

Taxing super

Image courtesy Images_of_Money

It’s important we also clearly define “earnings” in this situation as being the income generated by the investments in a pension super fund (eg. dividends, interest or rent), NOT the pension income stream drawn from that fund by the retiree. This means any tax liability is paid by the super fund, not by the retiree. The income generated by the investments in an accumulation super fund (ie. the super funds of all working Australians into which super contributions are paid) is already taxed in this way.


To be generating $100,000pa investment income at 5% return, the retiree would need a super balance of $2,000,000. Another way to generate investment income of that amount is to sell assets within the fund that have generated a large capital gain.

Now, it’s only income above the $100,000 that is taxed so another way to look at it is the tax-free threshold increases to $100,000pa at retirement. That’s per person too so couple’s super could earn $200,000pa before tax was due. And the tax rate is 15% compared to 37% for a worker earning $100,000 in wages (excluding levies, 2012-2013 tax year).

So yes, the government is raiding the super pot because they’re spending too much, but in reality it’s a small portion of the population that will be affected. You’ll be one of those affected if:

  • you’re at retirement age (55) AND
  • you’ve converted your accumulation super fund into a pension super fund AND
  • you’re drawing a pension income stream from your super AND
  • the investments in your pension super fund generate over $100,000pa income

Don’t forget, it’s the super fund that pays the tax so the Aussie retiree can still pull their $100,000pa out of super tax free if they’re over 60 years old.

If you need more information about how super is taxed talk to your financial adviser or call Suggars and Associates. You can also read about the 2013 Budget here.

5 Easy Ways to Start Organising Your 2013 Finances January 31, 2013

Posted by Meike Suggars in General, Personal Insurance, Superannuation.
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So we’ve just passed the Australia Day weekend. We know who won the 2013 Australian Open and who topped the Triple J Hottest 100. The kids are almost back to school. The year is well and truly on its way!

 If you want 2013 to be a better money-year than 2012, here are 5 quick things you can do to help get yourself onto the right track:

 1)     Check your savings account is still competitive. Many banks offer special introductory interest rates to suck you in, but then after a few months they revert back to a standard rate. Use a comparator like Canstar http://www.canstar.com.au/savings-accounts/compare-online-saver/ to get a quick overview of what’s out there but do your own research by contacting the banks yourself too.

2)     Check your Binding Death Benefit Nomination is correctly set up so that if you die prematurely, the right people receive any money in your super fund. Your most recent super statement (probably dated around October 2012) will show you whether you have a beneficiary nominated and who it is. There may be tax implications for your beneficiary so talk to a financial adviser if you’re not sure.

3)     Check you’re not underinsured at home. As we’re right in the middle of bushfire season, it’s a timely reminder to check that your home and contents are properly insured – for the right amount and to cover the right risks. Check the policy wording and work out what would it cost you to replace absolutely everything? Getting a good insurance broker makes it easy. Here’s a story that highlights the implications of being underinsured.

4)     Check your mortgage is covered. If you have a mortgage on your home, would your family still be able to afford it if you died prematurely? Make sure they keep their home if they lose you by getting life insurance that at least covers the debt amount. It’s also a good idea to have some extra left insurance over to cover living expenses, so we strongly suggest you talk to an insurance adviser like Suggars & Associates as there are so many different options out there.

5)     Check your health insurance is competitive. A number of comparators are advertised on TV but these only display the insurance companies that pay to be included. Instead, use http://www.privatehealth.gov.au/dynamic/compare.aspx which includes all insurers in Australia

Of course, if you really want to get your finances in order, the best way to get started is to see a financial adviser. They’ll help you work out your goals and objectives and help you map out a plan to get you there.

If you’d like help with any of these items, call Suggars & Associates and we can get you started.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.


You can afford insurance May 23, 2012

Posted by Meike Suggars in Personal Insurance, Superannuation.
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In 2010, a study by Lifewise found that 95% of families didn’t have adequate levels of insurance. One in five families are likely to be impacted by the death of a parent, a serious accident or illness that renders a parent unable to work; The typical Australian family will need to cope on half or less of their income as a result of underinsurance.*

With so many families without adequate cover, unexpected financial pressures on top of a serious heath event can put significant strain at a very difficult time.

Understanding their finances are one of the main reasons Australians fail to protect themselves and their families. How can I afford the premiums? Here’s how.

Insurance cover through super

Did you know that you can pay your insurance premiums through your super? This may assist you with paying insurance premiums when you have a low disposable income.

Other ways to pay for cover

You can make contributions to your super fund and gain tax benefits:

  • If you’re eligible to salary sacrifice to super, you can have premiums paid from pre-tax dollars. And because your super fund may be able to claim a tax deduction for the premiums, you may not need to pay tax on the contributions.
  • If you’re self-employed, making a personal contribution to super from after-tax income to cover premiums lets you claim a personal tax deduction.

You could also:

  • take advantage of tax offsets of up to $540 by making a super contribution to your low-income spouse
  • make personal contributions to super, and if eligible, qualify for a Government co-contribution of up to $1,000.**

 Be aware – get the right advice

  • A benefit payment under superannuation is paid to the fund trustee. The trustee will only pay benefits to you or your beneficiaries if you meet a superannuation condition of release.
  • Tax on death benefits is determined by who receives the benefits. You may need to ensure a binding death nomination is in place so that benefits are paid to those intended.
  • Paying premiums from superannuation may erode your retirement funds so think about topping up your super fund when you’re able.

To take the first steps to getting the right cover for you call your financial adviser or Contact us today


This information was prepared by AIA Australia Limited (ABN 79 004 837 861 AFSL 230043), it is current at the date of this document and may be subject to change.  This information does not constitute financial, legal, medical or other advice and is provided for general informational purposes only, without taking into account your objectives, financial situation, needs or personal circumstances, and may not be exhaustive.  Please consult a financial adviser before making any decision in relation to any financial product.  While this information is believed to be accurate, AIA Australia expressly disclaims all liability for representations or warranties, expressed or implied, contained in, or for omissions from, this information.

[*]  Lifewise/ NATSEM underinsurance report 2010

[**] Eligibility for the co-contribution applies. The Federal Government has proposed to reduce this to a maximum co-contribution of $500 from 2012–13.


Looking down from heaven March 16, 2012

Posted by Meike Suggars in General, Life Insurance, Superannuation.
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For many of my clients, life insurance is the first type of personal protection they consider – usually when purchasing a property or starting a family. If you provide financially for members of your family – either children, siblings or parents – it’s likely that term life insurance will form a key part of your Personal Protection Plan.

It’s also likely that you’ll want your dependents to have access to insurance monies as soon as possible; after all, bills still have to be paid even if you’re not here.

Looking down from heaven

Looking down from heaven – would you be happy with what you saw?

To speed up the payment of insurance benefits, consideration should be given to the use of binding death benefit nominations if the life insurance policy is held within superannuation. AMP’s claims experience indicates that using a binding death benefit nomination instead of a non-binding nomination on average reduces the time taken to settle the claim by 60 per cent.

A valid binding death benefit nomination can also be useful in reducing the likelihood of protracted legal disputes over the proceeds of a will.

There are restrictions on who you can nominate as beneficiary of a binding death benefit nomination, and there may be tax implications so it’s important you talk to your financial adviser or contact Suggars & Associates to ensure your life insurance is structured in the most effective manner for your personal situation.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions

Photo courtesy of karindalziel


How to find your lost super March 3, 2011

Posted by Meike Suggars in Superannuation.
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Once upon a time, our employer got to choose the super fund into which they made contributions. This meant that each time we got a new job, we also got a new super fund!

Have you lost old super funds?

But things have changed and you now have the choice and so you can request your that employer pay your super into which ever fund you like.

Make sure all your old super funds have been consolidated into your primary fund (ie the fund you want contributions to go to) so that your super money is working as hard for you as possible. Having it spread around multiple funds means you’re paying multiple sets of fees, and not likely to be getting the best performance.

And if your old super fund has been transferred to an Eligible Rollover Fund, you’re likely to be paying much higher fees than normal.

To see if you’ve got any lost super, visit the government’s SuperSeeker website and enter your Tax File Number (TFN). You’ll then get a list of any super funds in your name.


Talk to your adviser or call Suggars & Associates to learn how you can roll all those old funds into your primary super fund, and really get your money working hard for your retirement.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.


Free Money from the Government! April 13, 2010

Posted by Meike Suggars in Superannuation.
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With the end of the financial year fast approaching, now is the time to review your tax position in order to take advantage of tax concessions offered by the government.

Co-Contribution – $1000

To help boost our superannuation balances, the government has a dollar-for-dollar matching scheme. If your taxable income plus the value of salary sacrifice contributions is below $61,920, you can receive up to $1000 from the government by making a $1000 non-concessional contribution (using your own after-tax money) to your superannuation.

Free money!

Get your free money!
Photo by Martin Kingsley

Low Income Tax Offset (LITO) – $1350

By salary sacrificing if you are employed or making concessional contributions if you are self employed, you can potentially reduce your taxable income to below $63,750 which then allows you to qualify for the LITO of $1350 or a portion of it.

This is the only government benefit that you can take advantage of by making concessional contributions with before-tax money to your superannuation.

Spouse Contribution Splitting – $540

If your spouse earns below $10,800, you may qualify for a $540 tax offset by making a non-concessional contribution of at least $3000 with your after-tax money to their superannuation fund. You can receive a portion of the $540 if your spouse earns up to $13,800.

To qualify for any/all of these tax concessions, superannuation contributions must be made before 30 June 2010 so they can be included in your tax return. Conditions do apply to all “free money opportunities” outlined here, so contact Suggars & Associates to learn more.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.