Consider alternatives to super to avoid further changes : Lifeplan

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Investors concerned about the continuous changes to superannuation – particularly those that have reached the maximum contributions this year – should look to adopt alternative strategies for their long-term retirement savings, says Matt Walsh, head of Lifeplan.

“The attractiveness of superannuation as a tax advantaged, long-term investment vehicle continues to be tarnished by government changes, making it much less attractive to investors wishing to save more than the superannuation guarantee contributions.

“People still want to save for a comfortable retirement, particularly those that have additional sums to invest who have already reached their cap, but are increasingly discouraged from doing so through the superannuation system.

“However the main benefit of superannuation – that it is a tax advantaged investment vehicle – is replicated in other investment strategies such as investment bonds.

“These limit the tax on earnings to 30 per cent or less, with no cap, and offer investors a wide range of investment options to suit their needs.”

Mr Walsh said the inclusion of tax advantaged vehicles that offer diversity and growth should be appealing as an alternative, or additional, strategy to people concerned about continual government interference with their super savings.

“Superannuation is a trillion dollar honey-pot that no government can resist tapping to fill in holes in the national budget.

“Many investors are increasingly concerned that at some time in the future they will either be taxed more or have severe restrictions placed on their ability to freely access their retirement nest egg.

“Such investors should consider alternate investment strategies to super.

“For example, while there is never a guarantee about what Governments will do in the future, there have been no material changes to legislations on investment bonds for 10 years, and even that last change was a positive one, granting official sanction to the ‘scholarship plan’ variations on the investment bond structure in 2003,” Mr Walsh said.

Lifeplan Funds Management is a specialist business of Australian Unity Investments.  It is the market leader in investment and funeral bonds, and a leading provider of education investment funds.  


For more information please contact:

Matt Walsh – Phone: 08 8236 4706

17 April 2013