Speaker You are listening to Allied Health Podcast talking all things Allied Health with your hosts, Danielle Weedon, physiotherapist, and Clare Jones, occupational therapist.
Danielle Weedon Today’s episode of Allied Health Podcast is brought to you by Prime Super. Prime Super is a fully independent profit to member superannuation fund providing retirement solutions to Australians, and they place their members at the heart of everything they do. Over the past year, prime Super has been recognized as one of Australia’s exceptional super funds in various awards, including Money Magazine’s Best of the Best Gold Medal Award, acknowledging their high performing property investment. Rainmaker’s ESG Leader Award 2022. Recognizing Australia’s best super funds that are implementing environmental, social, and governance principles. And for the fifth year running Prime Super was awarded Canstar’s highest rating for its account based pension product. Prime Super were also awarded the Best for Customer experience by WeMoney.
Clare Jones Billy, welcome to Allied Health podcast.
Billie Atanasova Thank you. Thank you, Clare. Thank you Clare and Danielle for having me.
Clare Jones We are gonna talk all things superannuation in this episode. So to kick off, Billy, you’ve had a career in health. Can you tell us a little bit about that and how you came to work for Prime Super.
Billie Atanasova Yes, yes, of course. Yes. So I spent over 20 years in the public and private health sectors, so both in acute and primary health settings where I had managed, supported, and developed a fair bit of allied health professionals. And it was during my time at an organization called Leading Age Services Australia, where I was introduced to Prime Super as they were one of the preferred funds the association worked. Well, long story short, I ended up moving from the health sector to the financial services sector and now work at Prime Super.
Clare Jones So you’ve spent 20 years in the health sector. During that time, what did you learn about health professionals?
Billie Atanasova Well, it was actually clear. It was clear to me that they tended to work very long hours, often getting home quite tired and exhausted, probably due to the physical and emotional nature of their work and the energy requirements that they needed for their very hands-on roles. And I also noticed that they didn’t really put much time aside for their own health and wellbeing, which was, which was so ironic because they spent many hours of their working day taking care of others’ health and wellbeing.
Clare Jones Yeah, it sums up the majority of people working in health, doesn’t it?
Billie Atanasova Yeah, so true. And look, over the years I’ve spent in the health sector, I also built so much admiration and appreciation for Allied Health staff as they are such an important component within our health and aged care sectors. And I’m so grateful today, Clare and Danielle to have the opportunity to remind listeners about the important link between mental, physical, and financial wellbeing and to hopefully get the listeners to be a little bit more super savvy.
Danielle Weedon Yeah, we get questions asked a lot about super. So, um, really broadly, can you tell us a bit about super Billie? And before you do, I know you’ve got a brief disclaimer, you need to run through.
Billie Atanasova Yes, thanks Danielle. I’m not an authorized financial advisor, and the information shared on this podcast is general in nature and does not consider your specific circumstances. The information should not be relied upon to make an investment or financial decision. You should seek appropriate tax and financial advice and read our product disclosure statement before making a decision about Prime Super for a PDS and Target Market Determination you can call our 1800 number on 1800 675 839 or visit the website prime super.com au/pds . Now, simply put superannuation supports your financial health and can help you achieve your ideal lifestyle once it’s time to retire. It’s money you have saved, so you don’t have to solely rely on the government age pension. And when it comes time for retirement, the more super you have saved, the more comfortable your retirement will be.
Danielle Weedon And a lot of our listeners and allied health professionals we talk to, ask us this simple question, how much super do our listeners currently get?
Billie Atanasova So currently employers are required to pay 10.5% of your income to your superannuation account. This is called a superannuation guarantee payment. This may be paid to an account which you nominate, and if you don’t have a fund or nominate a fund, your employer will have to open one for you.
Clare Jones So Billy, just in summary there, so superannuation is an amount of money that your employer pays into a superannuation fund and you don’t access that money until you retire?
Billie Atanasova Correct. That’s exactly right.
Danielle Weedon And do you have to use a super account that your employer recommends or prefers?
Billie Atanasova Actually, it’s really important to know that you do not have to put your super into the fund that your employer prefers. You actually have the wonderful pleasure of choosing any superannuation fund you would like to put your money into. You have that choice.
Clare Jones Sorry Billy. I was just gonna say that’s something that has changed because in the past I know when I first started working in a part-time retail job and then moved into a hospital role as a qualified ot, I had to put my super into the fund that my employer nominated. So that’s changed now, hasn’t it?
Billie Atanasova Yes, it’s changed now. It actually changed from 2009. You have that choice.
Clare Jones Yeah. Great.
Billie Atanasova What a wonderful thing choice is.
Clare Jones Yeah. Absolutely. Gives, you control over your super, doesn’t it?
Billie Atanasova Yes
Danielle Weedon And what happens if, um, if you’ve got multiple super accounts opened and don’t need them?
Billie Atanasova Actually, last year legislation was introduced to ensure your superannuation is paid to a super fund, which you currently have money going into. This means that you will not be getting any new accounts opened every time you switch jobs, so you don’t have to pay fees for every super account that is open. And this is such great news for individuals as multiple fees with multiple super funds can eat into your retirement savings. If you don’t have an account, then you can choose which super fund you would like your money paid to.
Clare Jones Yeah, that’s a really good point, Billy. So the more super funds you have, the more fees you’re paying and the less that’s just gonna eat into the amount of money that you’ve got available when you retire.
Billie Atanasova Yeah. Yeah.
Danielle Weedon And what, um, what can you do if you’ve got multiple accounts open?
Billie Atanasova If you have multiple accounts, you should consider combining or consolidating all of your existing accounts to stop paying for the multiple sets of fees. You can easily do this by searching for the super accounts linked to your tax file number and roll them into one account if that’s, if that’s the best outcome for you. Um, some people deliberately have two accounts for insurance purposes, for example. And while we’re on the topic of consolidation, we have some exciting news from the 6th of February to the 31st of March, our members can go in the running to win a $5,000 super top up if they combine other super accounts with their Prime Super account. Just have a look at our website for all the Ts and Cs.
Clare Jones A $5,000 top up would be nice.
Billie Atanasova Yes!
Danielle Weedon And what about, you’ve mentioned that some, you mentioned insurance and that some people have got insurance included in their super. Can you tell us and our listeners a bit more about that?
Billie Atanasova Yes, insurance is such an important part of your super. It can provide security for you and your family against the financial strain that serious sickness injury or death can cause. So the types of cover available to our members are death cover, which is a lump sum to look after the financial needs of any of your dependents and total and permanent disability or TPD, which is a lump sum. If a member can no longer work due to physical or mental illness or. Now some really important questions to ask yourself about when it comes to insurance in super are, how much cover do you have? How much does it cost? How much do you need, and what are the inclusions and exclusions? And it’s also worth noting that if you, if you have not received a contribution or rollover for 16 continuous months, your cover could be canceled unless you have chosen to keep it. We also have income protection, which can pay a regular income if a member is sick or injured and unable to work and is available at an as an additional option so you can actually choose to take this up.
Clare Jones Yeah, that’s interesting Billie. I never knew until relatively recently that you had insurance with your super and I definitely didn’t know that, um, that there was an income protection option as well. So that’s really interesting to know.
Billie Atanasova Yeah that’s great Clare. Most people, most people don’t. Yeah. So it’s wonderful that we’re bringing this to their attention.
Clare Jones So with regard to the amount of super that you’re accruing, so your employer’s paying, um, 10.5% of your base salary to your super fund. Do you think that’s enough to retire on? I guess it depends on how long you work for. There’s a lot of variables. But is 10.5% of your base salary at the moment enough to retire on?
Billie Atanasova Yes. Well that is a very, very popular and interesting question we often get. Um, look, the Association of Superannuation Funds of Australia estimated that an individual will need. $545,000 to enjoy a comfortable lifestyle, assuming they are retired at 65, own their own home and are relatively healthy. Now this figure is higher for a couple, and depending on your annual income, this could be achievable through your super guarantee payments, which your employers are required to pay. For example, if you were a 30 year old with an annual income of $90,000 per annum and have a current account balance for $50,000, you would have approximately $730,000 in retirement using only super guarantee payments from your employer.
Clare Jones So that’s interesting. So that’s above the $545,000 mark, isn’t it? So that’s a good position to be in?
Billie Atanasova Mm-hmm. Yes.
Clare Jones And, and are there any ways you can boost your super savings? You can make, you can make other contributions, can’t you?
Billie Atanasova Uh, yes. Yes, of course. Yes. Look, using the simple example that I just mentioned. If you asked your employer to put, say, an extra $100 from your gross weekly income on top of your employer superannuation guarantee contributions, you would have over 1 million in retirement and this, and in this example, it would give you an extra $270,000 in retirement. So this is called salary sacrificing, and it’s great because you can benefit from it now and in the future. So the whole amount that you put towards salary sacrifice is only taxed at 15%. This may be lower than what your income is taxed, which means you may be, um, sending less money to the ATO and keeping more in your retirement savings.
Clare Jones Yeah, okay. So there’s a tax advantage there as well. Yeah. Yeah. Okay. That’s interesting.
Danielle Weedon Um, in terms of the Allied Health workforce, uh, as you know, a big percentage of us are female and we understand that there’s still a gender gap with super. Can you tell us why?
Clare Jones Yeah. Tell us about the gender gap, Billy.
Billie Atanasova Yeah. Yeah. Oh yeah. It’s no secret that women usually have lower superannuation account balances than men, and this could be for a few reasons. The gender pay gap affects superannuation as your super payments are based as a percentage of your income, which means if you are, if you’re paid less for your role, then you’re obviously also receiving smaller contributions to your super. As a result, on average, women in full-time employment earn 14% less than men doing the same work, taking home around $254 less each week. Um, career breaks, things like maternity leave can impact this as they don’t receive any super contributions during this period. Also, if women do return to the workforce, it is often at a reduced capacity. This will be affected by the government’s plan to extend the parental leave period for 26 weeks by 2026. Now, although this is such wonderful support for new parents, it negatively impacts the super gender gap even further as it extends the period where women aren’t actually receiving superannuation contributions.
Clare Jones Yeah, of course. Yeah, so it’s great that we’re increasing parental leave, but there is a negative impact on super.
Danielle Weedon Super contributions to women yeah. So what can we do to catch up, Billy?
Billie Atanasova Well, one of the ways of building these savings back up for retirement is, is by using contribution splitting. This is where the working partner can contribute some of their income into the spouse’s super account to, to help build up their um, savings. This is also great as it means the contributing partner will only pay 15% tax on this money rather than the higher amount that they are usually taxed.
Clare Jones Okay, so that’s where the tax saving comes in again. Um, so how else can we be super savvy Billie? What other great tips have you got?
Billie Atanasova Okay. Well, as mentioned earlier, it’s important to consolidate the superannuation accounts that you aren’t using. Talk to representative and make an informed decision. Before you do that vote, you may save on multiple sets of fees and multiple sets of insurance premiums. Also you can make extra contributions like salary sacrificing. This is great as you can save on your taxable income and the earlier you add more money to your account, the more your account can grow due to compound interest. For listeners that, don’t know what that is, please look that up. It’s very important.
Clare Jones So you’re talking there about those additional payments, aren’t you, Billie? That are taxed for the lesser rate.
Billie Atanasova Yeah. And it accumulates. So compound interest just accumulates over time. Yeah. You can calculate how much you need for retirement by using our retirement calculator on our website. This can help you determine how much salary you should be sacrificing.
Clare Jones I’ve heard that’s really easy to use that calculator, Billy.
Billie Atanasova Yeah. It’s very, very user friendly. It’s even just worth sitting down and just having a, having a play, and spending a bit of time just to get familiar with the retirement calculator.
Clare Jones Yeah, yeah, yeah, yeah.
Billie Atanasova Also you can pay a bit more attention to your investments. So someone who is younger may be able to take more risks, um, compared to, say someone who is nearing retirement. So it’s really important to know your investments and what your investment and risk appetite is. And, and here’s an interesting one. Try and think about what kind of money personality you have. Um, are you a peacock, a squirrel, a sloth, an owl or an ostrich? This is really, really interesting questions to be asking.
Clare Jones A money personality! A peacock, a squirrel, a, a sloth, or an owl, or an ostrich? Okay. What am I?
Billie Atanasova Okay, I’m not quite sure what you are, but I can tell you Clare, what a peacock thinks. A peacock thinks. I deserve to buy this. Uh, squirrel thinks saving money makes me feel secure. A sloth thinks where does my money go and often has high debts and an owl thinks I’ve got to put my money to work. And an ostrich is a bit of an avoider and thinks, oh, I’m gonna get to it one day. So your money personality may be linked to the way you view and think about superannuation. So thinking about your overall money personality, and how it impacts your views on superannuation might be a really good question you can ask yourself from time to time.
Clare Jones Yeah, I agree. And think I’m a squirrel. I think I’m a squirrel.
Billie Atanasova And look, I just wanna say one more, one more mention really. Um and just to highlight that superannuation guaranteed payments will increase they will go from 10.5%, which they are currently now to 12% by July, 2025. So we know that.
Clare Jones Yeah, so that means Billy on the 1st of July this year they’ll go up to 11%, won’t they? And they’re gradually increasing by 5.5% yes?
Billie Atanasova Yeah to 2025. And look, 12% of your salary is a very significant amount of money. I mean, it’s 12% of your overall salary. So please, if you’re not already, be a bit more engaged with your super, be a bit more super savvy, it’s really up to you to read more on the topic, talk to qualified individuals, ask them the questions that you don’t know the answers to, no matter how silly they may be. Um, and just make an informed decision when it comes to your super and your insurance and your investment options. Just like you would when you’re researching or buying any other items.
Clare Jones Yeah. Yeah. I think investing a little bit of time in Super now can pay huge dividends when you retire, can’t it? And I think this is something that’s, that’s often overlooked. Thanks Billy. Thanks so much for joining us on Allied Health Podcast. It’s been a really interesting discussion about super. I know we often get a lot of vague questions about super because it’s not front of mind and it really does need to be. Because as we said, it can have a huge impact on the amount of money you have to retire on. Now how can our listeners get in touch with Prime Super? And I know if you get in touch with Prime Super, you’ll actually speak to a person, won’t you?
Billie Atanasova Yes. You’ll actually speak to a person. Look, just, just wanted to say thank you, Danielle and Clare for giving me the opportunity. And it’s been a pleasure, um, to talk about all things super. Our listeners can speak directly to members of our member solutions team. Brian, for example, can be contacted directly on his mobile. His number is 0417 114 055. We also have Carol she can be contacted on 0429 010 231. And also our listeners can go to our website and go to the Book a Chat service that we have available and which can be found at primesuper.com.au. We’re here to help.
Clare Jones Fantastic. Thanks Billy.
Danielle Weedon Thanks Billy. Good to chat.
Billie Atanasova Thank you so much ladies.
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