POWERED BY MOMENTUM MEDIA
Downsizer contributions top of mind for BT clients
Downsizer contributions are among top questions asked by clients of the BT technical team.
The eligibility age for downsizer contributions had reduced from 60 to 55 years at the start of the year and BT said this was a frequent discussion point for its advisers.
Treasury Laws Amendment (2022 Measures No. 2) Act 2022 had lowered the age from which individuals could make downsizer contributions to their super fund from the proceeds of selling their home.
Starting 1 January, Australians aged 55 and over would be able to contribute up to $300,000 from the proceeds of the sale (or part sale) of their home into their superannuation fund.
A couple aged 55 and above could make a total contribution of up to $600,000.
To be eligible, clients needed to have owned their home for 10 years or more. Downsizer contributions to a maximum of $300,000 did not count towards any of the contribution caps, and could still be made even if a person had a total super balance greater than $1.7m.
Tim Howard, technical consultant at BT, said: “Downsizing can ease cost of living pressures for many Australians: not only does it free up money, the maintenance costs for a smaller home are also usually lower.
“In addition, the ability to make up to $300,000 in downsizer contributions to super tax-free can boost retirement savings significantly. However, as part of retirement planning, clients who are receiving an age pension, or expecting to down the track, should be made aware of how age pension means testing may be impacted.”
Other questions asked by clients included inflation impacts on indexation and the increase to income thresholds for Senior Health card.
AUTHOR
Laura Dew
Laura Dew is editor at Super Review. Prior to joining SR, she spent five years working at Investment Week in the UK covering asset and wealth management.
Recommended for you
While the Financial Advice Association Australia said it supports a performance testing regime “in principle”, it holds reservations about expanding this scope to retirement products.
In a Senate submission, the Financial Services Council said super funds should be able to nudge members on engaging with their super and has cautioned against default placements.
The Joint Associations Working Group, which counts FSC in its ranks, has issued an urgent warning to the government.
Senator Jane Hume will join the speaker lineup at the inaugural Australian Wealth Management Summit.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI First Close USD
66.99 3 y p.a(%)
2
Hills International
63.66 3 y p.a(%)
3
Acadian Global Equity Long Short Class A
36.33 3 y p.a(%)
4
CFS FC Acadian Global Equity Long Short
35.96 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
32.23 3 y p.a(%)
Add new comment