Despite all the effort that Australians put into saving up their retirement income, it could be the country’s tax systems that are putting their financial futures under threat, new research shows.
Six out of the eight most sophisticated countries in the world currently have tax regimes that are fairer on retirees than they are in Australia, consulting group Mercer found.
For example, in the UK the net retirement benefits of the average worker stand at 16.4 per cent – this works out around $43,534 higher than their Australian counterpart.
Canada, Chile, the Netherlands, Switzerland and the US all emerged to have fairer systems than Australia, AAP sources report.
However, senior partner at Mercer David Knox explained that the way superannuation is treated in terms of tax can be difficult to assess, not least because high income earners are the biggest participators.
Mr Knox commented: “However, it’s also important to look at our retirement savings system in its entirety and the impact altering the tax model could have on the future costs of funding the age pension.”
How can you maximise your super?
With a number of different pressures acting upon your superannuation, you will no doubt be looking for ways to make sure you retire with as much money as possible.
Seeking retirement advice is a good way of getting a second opinion on your retirement savings and what you can do to maximise them.
There may be all sorts of strategies you had not even considered, some of which could make a real difference to your savings pot.
How much will you need?
The amount you need to retire comfortably will depend on a number of factors, including whether or not you have a spouse’s income to support you and if there are any other financial dependents.
Figures from ASFA show that a couple hoping to live a comfortable retirement will need to spend $56,339 a year, or $32,555 a year for a modest lifestyle.
A person who is living on their own will need $41,186 a year for a comfortable lifestyle or $22,585 for a modest one.
The ASFA Retirement Standard for the December 2012 quarter revealed that retirement costs are on the rise, making it more important than ever for money to be set aside on a regular basis.
Taking action to make sure you will be financially secure is the only way to guarantee that you will be able to live the retirement you have always dreamt of.