Being a member of one of Australia’s most generous superannuation schemes is not, in itself, enough to ensure you end up with a secure retirement.
The most common mistake members of the PSS Defined Benefit Scheme make is that they do not contribute enough to the scheme during their working career. In effect, many members are making a very big mistake every fortnight and over a long period of time this can be a disaster.
The employer benefit is linked to member contributions and years of service so it is possible for members to severely disadvantage themselves by contributing at a low rate during their working career.
The key to maximising your PSS Scheme is to understand how your after tax contributions affect final retirement benefits. Depending on your salary and years of service, contributing at a rate of only 2% of salary over a long term career could shave $100,000, $200,000 or more from your final retirement benefit.
The second most common mistake members of the PSS Scheme make, and Public Servants more generally, is that they do not commence salary sacrifice to superannuation at the most appropriate time and at the most appropriate level. Usually it is commenced far too late at a low level with adverse retirement consequences.
When it comes to salary sacrifice to superannuation, if you are within 10 years of retirement, it is time to have a serious discussion about your retirement goals and ways to enhance your final retirement position. A discussion is the best way to understand your options, plan a way ahead and then take appropriate action.
What should you do next? It’s really simple: make contact with us to see how we can help you.
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