Managed Super Funds
Managed super funds are something every Australian needs in anticipation of their retirement. Without managed super funds, you may struggle with everyday living. It is expected that Australia will experience an immense demographic shift in the coming years. This would create an increase in pensions that would place a strain on the Australian economy. As a result of this anticipated growth, every Australian is encouraged to take an active role in their future by having managed super funds. Contributions to managed super funds are expected by both employers and owners of the super fund. Employers contribute a minimum of 9% of their employers wage towards their employees managed super funds and the owners of the super fund may contribute any amount they wish.
In 1992 the Superannuation Guarantee was introduced as a major reform to Australia's retirement income policies. Since its introduction, employers have been required to make compulsory contributions to managed super funds on behalf of their employees.
The contribution to managed super funds was originally set at 3% of the employee's income. In 2002, the contribution to managed super funds was set at a minimum of 9% of the employee's income. In 2006 it was decided that contributions to managed super funds could be split with a spouse. This may allow for a reduction in taxes on managed super funds.
Since the compulsory contribution to managed super funds was introduced, Australians works have over $1.77 trillion in managed super fund assets. Australia now has more money in managed super funds than any other country. There have been calls for the minimum contribution to be increased, however this may affect small business owners.
There are a variety of managed super funds available in Australia. In July 2005, it was decided that employees were to be able to choose their own managed super funds. Employees now can change managed super funds and consolidate their managed super funds.
