2. 2
Equipsuper Pty Ltd ABN 64 006 964 049, AFSL 246383 is the Trustee of the Equipsuper
Superannuation Fund ABN 33 813 823 017. This document and any information
provided with it is provided for general information only. It does not take into account
your personal objectives, financial situation or needs and should therefore not be
taken as personal advice. Before making a decision to invest in the Equipsuper
Superannuation Fund, you should read the appropriate Equip Product Disclosure
Statement (PDS). Past performance is not an indication of future performance. Equip is
licensed to provide personal and general superannuation advice under its AFSL.
Member Advisors are employees of Equip. For more information about the
remuneration of Equip and its employees, please refer to the Equipsuper Financial
Services Guide.
Equipsuper Financial Planning Pty Ltd (ABN 84 124 491 078, AFSL 455010) is licensed to
provide financial planning services to retail and wholesale clients. Equipsuper Financial
Planning Pty Ltd is owned on behalf of Equipsuper Pty Ltd (ABN 64 006 964 049, AFSL
246383) as the Trustee of the Equipsuper Superannuation Fund (ABN 33 813 823 017).
4. 4
Let’s see if we can change your mind!
We will show you in a few simple steps:
• How it pays off to start young
• How to best keep track of your super
• How a little extra can go a long way
• How to invest your money
5. 5
Test your super knowledge!
9.5%
$30k 15% *
* $35,000 for people aged over 50.
7. 7
Get your act together
It’s worth getting all your super
together in one spot:
• Keeping track of your super will be
easier;
• You may save on fees and insurance
premiums;
• Your super can stay in one fund no
matter where you work.
Consolidating your super works to your advantage!
8. 8
Get your act together
Equip
Fees on
$25,000
balance
$310.50
Insurance
premiums
($280k DTPD
cover)
$100.80
Total $411.30
BT for Life
Fees on
$25,000
balance
$322.50
Insurance
premiums
($100k DTPD
cover)
$74.40
Total $396.90
Australian Super
Fees on
$25,000
balance
$243
Insurance
premiums
($146.7k DTPD
cover)
$290.68
Total $533.68
Assumes member is 34 years old, male, with a salary of $70,000, in default investment option and with default
insurance cover. Information based on product disclosure statements of funds.
9. 9
Get your act together
Total fees, costs and
premiums combined across
the three funds
$1,341.88
If Equip only
All fees and premiums for
the $75,000 in super
$876.30
Extra savings per year $465.58
Note that cover held with the other two funds will cease on consolidation and savings include premiums no
longer paid for ceased insurance.
13. 13
Save on tax in super
Super Outside of super
Savings $1,000 $1,000
Tax* ($150) ($370)
Net savings $850 $630
Earnings -- 10% a year $85 $63
Tax on earnings ($12.75) ($23.31)
Total $922.25 $669.69
* Tax in super for contributions and earnings is 15%. Tax on savings outside of super is the marginal tax
rate. Assumption: 37% (income $80,000+).
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A coffee here, a beer there…
$20,000
$15,000
$10,000
$5,000
$0
Age at start
20
30
40
Source: Moneysmart compound interest calculator. Long-term return assumption 7%, compounding net of
fees and taxes. Assumes $20 per week compounding annually for 10 years only, commencing at ages 20,
30, or 40.
15. 15
There is no better time than right now!
$111,700
$62,400
$172,604
$85,887
$42,737
$180,000
$150,000
$120,000
$90,000
$60,000
$30,000
$0
20 30 40 Age at start
Source: Moneysmart compound interest calculator. Long-term return assumption 7%, compounding net of
fees and taxes. Assumes $20 per week compounding annually for 10 years only, commencing at ages 20,
30, or 40, with earnings continuing until age 65.
16. 16
Do some target practice
Annual returns for top three major asset classes, 2004-2013
Rank 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
1 32.0 21.0 34.0 18.0 15.0 39.6 7.8 11.4 33.0 48.0
2 27.7 16.8 25.0 7.0 13.4 7.9 5.5 10.8 18.8 19.7
3 9.9 12.5 11.5 6.8 7.6 3.9 4.6 2.2 14.1 7.1
Australian
equities
International
equities
Australian
property
Cash
Australian
bonds
International
bonds
Source: Vanguard; Australian shares: S&P/ASX All Ordinaries Accumulation Index; international shares: MSCI
World ex-Australia Net Total Return Index; Australian bonds: UBS Warburg Australia Composite Bond
Accumulation Index; Cash: UBS Warburg Australia Bank Bill Accumulation Index; International bonds: Citigroup
World Government Bond Index (AUD hedged); Australian property: S&P/ASX Listed Property Trust Accumulation
Index.
17. 1992 2014
17
The wild ride of investment markets
Source: Vanguard, interactive index chart. Growth of $10,000, 1 Jan 1992 to 31 March 2014.
18. 18
From peak to trough
$140,000
$120,000
$100,000
$80,000
$60,000
Source: Equip. Monthly returns of the Balanced Growth option, from the height of the market pre-GFC
until 30 June 2014.
21. 21
Stretch out a safety net
Insurance cover available
• Death / Total and permanent disability (TPD)
• Salary continuance (income protection)
And don’t forget to nominate your beneficiaries
(dependants)!
• Preferred: Trustee discretion
• Binding: Trustee is bound
22. 22
You can stay with Equip for life
Even when you leave your employer, your
super can remain with Equip
• Same investment options
• Same fees
• Insurance automatically continues
• Have your new employer contribute to
your Equip Personal account
23. 23
#1 – Start early to make more
money.
#2 – Consolidate your super in
Equip.
#3 – Kick your investments into
gear.
#4 – Super is not a tax. It’s your
money!
4 BIG
IDEAS!
Seek advice when and if necessary.
24. 24
Member support and advice
Helpline
1800 682 626
Member
adviser
03 9248 5923
Financial
planning
1800 065 753
Administration support
and information about
Equip
Strategies for your Equip
superannuation account
Financial complexity
Need
Financial plans for all
aspects of your financial life
25. 25
Annual review
Financial planning process
Process starts here
Discuss plan 1st
appointment
Annual review
Implement
agreed
recommendations
Request
appointment
Strategy
planning
Gather
information
26. 26
How can we help you?
Our services include
• Financial planning
• Superannuation
• Retirement planning
• Redundancy planning
• Wealth creation
• Wealth protection
For an appointment - call 1800 065 753
- email fpappointments@equipsuper.com.au
27. 27
Equip members receive an 8.3%
discount on Medibank health cover.
Travel cover.
Competitive banking products and
services (savings and term deposit
accounts, home loans and credit cards).
Discounted services to will preparation
and estate services (Victoria only).
Member Privileges
Equipsuper does not sponsor, endorse, sell, or promote or recommend the products and services offered by
these providers.
Do you know how much money you have in your super? Chances are that you have several super accounts – most Australians do. In fact, on average they have their money in three different funds.
You might very well have even more than three – many of you will have moved jobs over the years. You might have made a career shift in your late 20s, after going back to school part time. And what about when you served beer at the pub down the road while you were at uni (or were in-between jobs)? You may have no idea where some of your money sits, because you have moved a few times since. While you know it’s not much, it’s likely that fees have been eating into some of your accounts.
You can get a lot more value from your super by getting it all consolidated into one account.
Most importantly, that way you can easily keep track of your super. With multiple accounts, do you have a clue how your super is doing? Having your money in one place gives you everything you need to know at a glance.
You may save on fees and insurance premiums
Remember that your super can stay in one fund no matter where you work!
On a related note: There is a reported $10+ billion of lost super money sitting at the ATO. Have you ever changed your name, address or job? Looking around the room, I think most of you have. You can check to see whether you have lost super by accessing the ATO’s SuperSeeker tool. You can access it either directly or through Equipsuper’s website.
Assumptions – 35 years old, 50k balance
FUND A is BT for Life
FUND B is Australian Super
“SalSac” / how much is enough
For many of you, your super is likely going to be your main income during retirement. Don’t bank on getting the age pension, which is a safety net for those that need it most.
Many older workers retiring now are finding that they haven’t saved enough to be self-reliant in retirement. We don’t want you to fall into that trap.
9% super might not be enough to maintain a comfortable lifestyle.
We’d need a crystal ball to know how long we will live. You might have heard that the government is gradually ramping up mandatory contributions to 12% by 1/7/2019. Some industry pundits have put the required number closer to 15%, which they believe is more appropriate to achieve a comfortable lifestyle once you are ready to quit the workforce.
Your extra contributions are tax efficient.
You can redirect some of your before-tax salary into your superannuation account. The government calls this salary sacrificing. Not only do the extra payments boost your super, but this option also provides you with a tax saving. This starts to be attractive for people making more than $37,000, where you pay a marginal tax of 32.5%, rather than the 15% you pay for any extra super contributions you make (up to $25k).
Let’s take a peek at what the markets have provided over the last decade. This table summarises returns of some of the main asset classes Australians typically have invested via their super account – Australian and international shares, Australian and international bonds, property, and cash. I am only showing you the Top 3 for each of the last ten years.
Both Australian property and Australian shares show up in the Top 3 frequently. Property, by the way, is mostly comprised of commercial and industrial holdings.
Besides shares and property, other asset classes make a showing in this list, too. Look at International Bonds, which has had a strong running over the past few years. You may not know this, but most of Equip’s Diversified investment options hold international bonds, as part of our allocation to diversified fixed income. So who would have chosen that?
We all love to pick winners. However, it’s difficult to do that on a consistent basis, as investment markets fluctuate constantly, and sometimes wildly! For most of you, your super is the longest-running investment portfolio you will ever own. Holding a diversified portfolio is generally better than trying to time the market.
Short-term performance should not be your guide – be mindful that chopping and changing based on the latest news can be tricky. It makes much more sense to assess performance over the long term – five to seven years at minimum, above all when you look at growth assets such as shares or property, which are more volatile than others, but tend to outperform over the long run.
Super is not just about investing, though. Many super funds have insurance options to provide financial security for you and your family, at very competitive rates.
Typically, in superannuation death and total and permanent disability are combined into one offering. To protect yourself from short-term disability or illness, you can opt for salary continuance insurance, providing you with income for a duration of up to two years.
Insurance is particularly important if you have either debt or dependants. What would happen if you died, or if you became too sick to work?
Did you know that every year, around 236,000 working age parents suffer a serious illness or injury? More than 17,000 will be forced to stop working permanently or for an extended period of time.
Now is a good time to check what insurance cover you have. In order to see whether it’s appropriate, you should add up your assets and liabilities, and consider whether your cover is adequate to look after you and your dependants if something happened to you. If in doubt, get some advice what is appropriate for you.
And since we’re on the topic, you need to nominate your beneficiaries. This is important for both insurance and super payouts. It provides the superfund with guidance in terms of which dependants will receive your money. You can also make a binding death benefit nomination, which will oblige the fund to pay out to the eligible people you have nominated.
See? Super is not all that complicated. You just need to activate your money and make it work for you. To summarize, here are a few big ideas to take home with.