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Understanding super & money
Super savings are a money goal that matters. But when you’ve got other important reasons to save, how do you decide where to put your hard earned cash?
Watch (3:30 minutes)
Watch (3:30 minutes)
Does it make sense to save in super or elsewhere? Gen from the IOOF team breaks down the benefits of putting more into super.
Saving can be hard at the best of times. And when the money you’re putting away is off limits until retirement, it’s harder still to make saving a priority. Is it really important to save into super when you could be putting money away in a regular savings account to draw on when you need it?
In making this choice for your situation, it’s good to keep things in balance. Having a really healthy super balance at retirement is great but not if that means you can’t afford to take holidays or enjoy a meal out with family and friends in the meantime.
In other words, saving extra for super shouldn’t be about giving up all your comforts now to make sure you’ll be comfortable in the future. Plus, there are some important things you’ll want to think about before getting around to freeing up some cashflow to put into your super. Here are two that you definitely should be considering:
“Debt that helps you build wealth can be a good thing. But whether you’re happy to slowly pay down your home loan, or you’ll sleep better at night when the balance gets to zero, it’s important that you feel in control of your financial position. I mean we could all do with a $100,000 windfall, right? But when you can comfortably pay your regular expenses and have something in reserve for getting the car fixed or replacing a broken appliance, you can enjoy peace of mind and maybe think about extra super savings as your next step towards financial security.”
Why super savings makes sense
If you do have money put away for a rainy day and you’re comfortable with your plan to buy a home, then extra super savings could have an edge over a regular savings account for a couple of reasons:
Saving more super is an important goal at any age. But it’s just as important to be comfortable with your money situation, including having emergency savings, just in case.
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