Everything old is new again

SMSF technical expert and columnist for The Australian newspaper
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There’s never a dull moment in the realm of retirement planning. Just when you thought everything might settle down, up pops some Government policy changes, which cause anyone still working and older than 60 to re-think their strategies. This time it might be a good outcome. The increase in the concessional contributions cap to $35,000 from $25,000 for older workers makes a transition to retirement pension strategy more viable.

The bare facts

Let’s look at an example (summarised in the table below).

John Simpson is 61 and wants to work full-time for another five to 10 years. He receives a salary package of $120,000 per annum. His employer allows him to salary sacrifice as much of his salary as he wants. He and his wife own their home and have one adult child still at home. They need $50,000 a year after tax to live on. His salary package includes his employer’s compulsory super contributions.

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