For most people, deciding what should be done with their assets and possessions after they die is not something they like to consider. Although it is a bit morbid, this decision is extremely important to ensure your carefully earned assets are distributed according to your wishes. While most people bequest their house, household contents, jewellery, collectibles, cars, boats, and things of that nature in their will, their superannuation and pension balances are often forgotten. This is where superannuation death benefit nominations become extremely important.

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What steps can you take?

Superannuation fund trustees allow members to make what is called a ‘death benefit nomination’ for their account balances. This nomination allows members to dictate to the superannuation fund trustees where their superannuation benefits should be paid if the member passes away. However, it should be noted that there are different types of death benefit nominations and not all superannuation providers offer all options. The governing rules of superannuation funds define whether they can allow certain types of death benefit nominations to be made.

There are two types of death benefit nominations: binding and non-binding. Both are only activated on the superannuation members’ death and are usually paid in lump sums to the beneficiaries.

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Binding death benefit nominations

A binding death benefit nomination binds the superannuation trustee to paying the members’ superannuation benefits as directed by the member before their death. However, binding nominations can still be overruled by the superannuation fund trustee in some cases.

Binding nominations expire every 3 years. While having to provide a new nomination every 3 years may seem like a hassle, consider how much your life may change in 3 years by births, deaths, separation, divorce or marriage etc. When this is taken into account, updating your death benefit nomination every 3 years seems like a prudent measure.

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Non-binding death benefit nominations

A non-binding death benefit nomination is similar to a binding death benefit nomination, except the superannuation trustee is not bound to pay your superannuation benefits to your nominated beneficiaries. You are able to nominate who you would prefer your benefits to be paid to, however, this is used as a guide and the ultimate decision remains with the superannuation trustee. The trustee must still pay the benefits to a dependent or your legal personal representative however.

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Non-lapsing binding death benefit nominations

These are much the same as binding death benefit nominations but with one crucial difference – this nomination remains in place until you revoke it, change it or make a new nomination. This may present a trap if you nominated your beneficiaries when you first opened your superannuation account 10 years ago but have not checked or updated your nomination since then.

If you were to pass away before updating your nomination, your superannuation benefits might not be paid the way you intended. It’s worth checking your nomination often to ensure your beneficiaries are up to date. This information is usually recorded on the annual statement provided by your superannuation fund at the end of every financial year.

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Reversionary nominations

Reversionary nominations are another type of death benefit nomination specifically in relation to a pension or annuity. It simply means that on your death, the regular payment amount from your pension or annuity would continue to be paid to an individual nominated by you.

If the rules of the superannuation fund allow it, you could nominate your beneficiaries via a binding or non-binding death benefit nomination instead of a reversionary nomination, however, the benefit would be paid as a lump sum, not a regular income stream. It’s also worth noting that not all beneficiaries can receive a superannuation death benefit as an income stream.

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Self-managed superannuation funds

Self-managed superannuation funds are able to make binding death benefit nominations, however, they are bound by rules and limitations according to the ATO Self-Managed Superannuation Funds Determination 2008/3.

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What happens if no binding nomination is in place?

If a member has no binding nomination in place or has let their nomination lapse, the superannuation fund trustee may consider any valid non-binding death benefit nominations the member made before their death when deciding where to pay the member’s superannuation benefits. The trustee will also make enquiries about the member’s will and family situation before paying the benefits, however, the superannuation fund trustee must pay the death benefits in accordance with the superannuation fund’s trust deed rules as well as the governing rules of the superannuation fund, superannuation law, and common law. 

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Who can be a beneficiary?

Your beneficiaries/beneficiary must be a dependent of you or they must be your legal personal representative (LPR). This is usually the executor of your will or your estate administrator. You are able to nominate multiple beneficiaries with different allocations but the total allocation must equal 100%. You are able to allocate part of your benefits to your LPR with the remaining portion going to a beneficiary.

The SIS Act 1993 classifies a dependent as one of the following:

• Your spouse or de-facto spouse
• Children, including adopted, ex-nuptial and stepchildren of any age
• A person who was financially dependent and reliant on you at your death
• An individual who has a close personal relationship with you. This person must live with you and one or both of you must provide the other with financial support, domestic support, and personal care. They do not have to be related to you.

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Making a valid nomination

For a death benefit nomination to be valid, all of the following criteria must be met:

• Nomination is made in writing by the member
• Beneficiary is a dependent according to the SIS Act 1993 or is the LPR of the member
• Allocations are clear and all required details have been provided
• Nomination has been signed and dated by the member in the presence of 2 witnesses over the age of 18
• Nomination must be reviewed at least every 3 years

Checking that the death benefit nominations on your superannuation funds are up to date will ensure that your carefully accumulated superannuation benefits are paid to the right people after you are gone.

For help on nominating your beneficiaries or making a death benefit nomination, contact Quill Group today. Quill Group also has in-house estate planning lawyers based on the Gold Coast through our subsidiary company Intello Legal.

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Other articles related to binding death benefit nominations

The following are other articles related to superannuation estate planning which may be of interest:

• The importance of estate planning
• Is your SMSF estate plan up to speed?
• Wills and SMSF estate planning (Intello)

With the Government abandoning its policy to introduce a $500,000 lifetime cap for non-concessional contributions are you clear on what non-concessional contributions you can make to superannuation now?

Non-concessional contributions are contributions that are made to super from after-tax income or savings.

Instead of going forward with its proposed $500,000 lifetime cap on after-tax contributions, (with a retrospective counting of the last ten years) the Government has decided to go back to the current rules for after-tax contributions but with a lower annual limit of $100,000.

This will now allow individuals to:

• make non-concessional contributions of up to $100,000 per year
• have the ability to bring forward 3 years’ worth of contributions to a single year (allowing you to contribute up to $300,000 in a single year)

The ability to make non-concessional contributions will also be limited to people who have an individual superannuation balance of under $1.6 million. In addition, if you are aged 65 or over you need to pass the “work test” to contribute to your super and cannot bring forward contributions to the current year.

The new rules will apply from 1 July 2017.  This means that for the current 2016-17 financial year people can still make non-concessional contributions of up to $180,000. Also of note is that you may still do the three year ‘bring forward’ rule, allowing a $540,000 contribution this year.

So there are still some new things to get used to, and you need to be aware of your current super balances before making contributions. But things are a whole lot better than they were back in May.

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Still not sure what it means for you?

If you need assistance with any aspect of making after tax contributions to superannuation, please feel free to call Quill Group Financial Planners to arrange a time to meet so that we can discuss your particular requirements in more detail.

I was interested but not necessarily surprised to read two articles this week relating to financial fortunes of the general Australian population. The first article talked about financial literacy, where a study by Zurich and Oxford University found that Australia ranked near the bottom of the tables. In the second article, a study by the Actuaries Institute found that almost a third of Australians are in danger of running out of money because they are drawing too much out of superannuation.

With the percentage of Australians that do not currently seek any ongoing financial advice sitting at close to 80%, these reports should not be surprising to anyone. The risk of not achieving any long term goal without some form of coaching, mentoring or external direction is extremely high and it makes sense that those with a trainer, coach or in this case an adviser, have a far better chance of maintaining discipline and achieving their goals.

Why is it that so few Australians reach out for financial advice to help improve their financial literacy?

One of the reasons provided by respondents to many surveys on this subject is that the cost of ongoing advice is just too high and many feel they don’t have sufficient assets to justify the cost. This leads to a situation where those who are in most need of advice are the very ones that don’t receive any. From an adviser’s perspective, the compliance cost of providing advice in the first place drives costs up. Therefore, under the current model, I would argue that this situation is unlikely to improve.

So, what is the solution to increasing the percentages of those that do seek financial advice and thereby starting to redress the issue of poor financial literacy?

This is where I believe the role of automation, in many of the time-consuming back office processes, as well as ‘robo advice’ can make a big difference. These factors can assist advisers to drive down the cost of advice to the end consumer.

I believe that ‘robo advice’ will eventually be embraced by advisers as an opportunity rather than a threat to their profession. It can play a large part in assisting advisers to deliver a ‘bionic’ advice solution to their future generation of clients.

We have already witnessed the start of bionic advice in the US where advisers are able to combine their knowledge and strategic advice in combination with a ‘robo advice’ investment solution. This has assisted in delivering digital advice to a much larger group than otherwise possible under the traditional face to face advice model. My view is that, in doing so, a new generation of adviser will be able to efficiently inform a larger group of clients in a cost effective manner that not only meets their needs but ultimately leads to an improvement in adult financial literacy.

In summary, you don’t need to know and be across all financial jargon. The burden should be on advisers to translate the financial lingo into plain English. New apps like Superstash make this easier. Superstash is like a Fitbit for your super – convenient and game-changing.

Until recently, my husband and I were in decent paying jobs. We were renovating and paying off our first home while saving to purchase the next family home. It’s ironic that sometimes, no matter how prepared you are, a simple accident can take away, in an instant, everything you have worked so hard for.

The Injury

Last year, my husband was injured while performing one of his usual work duties; cleaning the work van on the weekend so that he was ready for the working week ahead. As the injury occurred on a weekend, his employer advised him that he was unable to claim the incident through Workers Compensation. After investigations and various conversations, we discovered that as it was a requirement to have the vehicle clean and ready for work he was able to make a claim.

WorkCover

This process was long and painful though as we had to provide a massive amount of information to WorkCover supporting our claim. After a period of time, WorkCover ceased the weekly payments and my husband and I became concerned with the lack of money coming in when compared to the amount of bills we were having to pay. This added extra stress as my husband was still recovering from surgery.

Fortunately, a colleague of mine inquired into whether we had Income Protection. This wasn’t something we had considered as we had been focusing all our efforts on the WorkCover claim. I contacted my husband’s superannuation fund and started the application process.

Income Protection

Income Protection was one thing we knew was really important but we didn’t understand what type of cover we had. We were required to wait 90 days after the last day he had worked to be able to commence a claim. As you can imagine, 90 days without income can be extremely difficult.

Detailed forms had to be completed including an Employer’s Statement. This had to be completed by my husband’s employer and because the employment ceased on bad terms, we knew the required information would not be provided.

When we explained the whole situation to the claims assessor, she made sure the process was speeded along so that we didn’t have to wait too long; by this point, we really started to struggle financially.

By the time the claim had been approved, my husband had been diagnosed physically fit to return to light duties and due to this, we were only entitled to a once-off lump sum payment.

In hindsight, we should have researched the type of cover we had in more detail and made an appointment to see Tony Marshall before the accident so that we had more appropriate cover. Make sure you make an appointment to discuss your insurances with someone so that you have peace of mind as you never know what could happen tomorrow.

Several months ago, I wrote a blog on the Four Corners episode which brought to light the real need to obtain financial advice when selecting an insurance policy. Just recently, I came across this article in the Sydney Morning Herald which further provides evidence on why you should seek advice. The article titled “Insurer tells family saving daughter’s life is ‘elective surgery’” is worth a read as it touches on the fine print that is often very easily missed but has a big impact on your family’s life should something unexpected arise.

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Hold it in your name

I find that, in my profession, a majority of clients hold income protection within their super. As an advisor who is an advocate for life insurance, and in particular income protection, my preference is to always hold an income protection policy in your personal name. There are many reasons for this:

–          Premiums are tax deductible

–          You are able to access many more features than if you were with 100% super owned policies. This is mainly due to legislation rather than product offerings.

–          The policy is portable. This is opposed to holding it in super where you may be required to retain the super fund for the remainder of your working life if you cannot replace the policy.

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Make a well-informed decision

Though my preference is to hold the policies personally, I am certainly aware that some people, due to budget constraints, are unable to fund the premiums.  This is where you need to consider the pros and cons of super vs non super and weigh up the options that best fit your circumstances. At least then you have the opportunity to make an educated decision.

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Changes in Legislation

It should be noted though that since a change in legislation a few years ago, to what policies can be held inside super, we have seen more sophisticated and diverse policies available. While this prevents scenarios such as the Anderson elective surgery dilemma from happening again, not everyone offers these policies. For example, any industry fund does not offer such a policy!

This is just a summarized glance but as you can see life insurance can be a very complex world. This is why it is recommended you obtain professional advice.

So that’s it. BREXIT.

It’s real, it’s alive and it just arrived at a share portfolio near you.  Or even in your house. It was certainly a surprise, and surprises are the thing that markets do not like!

Let’s start our examination of the situation with some perspective.

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Markets

The Asian region was the market that was open as the votes counting started to swing towards the Leave vote.  Our market started the first ten minutes by rising 0.6%, but then the as the news started to filter down, the market lost 2.6% by 11 AM. It bottomed out at around 2PM, being down 3.7% and then started to rise, finishing the day down 3.2%. Most other Asian markets fared OK, with Shanghai down only 1.31%, India down 2.2%.  It is a key consideration that the emerging markets performed relatively well, which supports our general view that valuations there are much better than many developed markets.  By contrast however, Japanese stocks finished the day down 7.26% as the soaring Yen shattered the traders who were on board the crowded short Yen/long Japanese stock trade.  The Yen was the safe haven currency of the day soaring 12.95% against the pound and 3.88% up against the USD which was the next strongest currency.

As European markets opened, the Euro Stoxx 50 index crashed on the open, but found its low within the first half hour down 9.9% from the previous day.  It then found some buyers, and spent the rest of the day crawling along the floor, finally closing down ‘only’ 8.62%.  The country at the epicentre of the political fallout actually fared much better.  The UK FTSE 100 index initially fell by 8.6% from the confident close it made the day before, but then found very strong support, and finished the day the least weakened out of all the European markets to be down only 3.15%.

As mentioned, some perspective here is very useful amid all of the angst and panic.

Markets reached maximum Brexit pessimism back on Tuesday the 14^th of June.  The FTSE 100 then was at 5923 points.  In the seven trading days that followed (to Thursday the 23^rd), it rallied 415 points, or seven percent!

So all that happened by the close on Friday night in the UK was that it gave up around half of the gains made in the previous seven days.  It was still 3.6% HIGHER than it was on Tuesday the 14^th of June. More than that, at 6138 points, it is still 10.8% higher than it was back in the doldrums of February.

For every action there is an equal and opposite reaction.  Sterling (the UK Pound) was the big loser on the night, down 12.95% on the very strong yen, down 8.05% on the US dollar, and 5.75% lower against the Euro.  This currency weakness is what is supporting the stockmarket in London, since a lower currency (within reason) makes your exports more competitive, even if you have just ‘given the bird’ to your biggest export customer.  Just look at what Japan is trying to do with their currency. Make it weaker to support the exporters. Everytime the Yen falls a significant amount, the Nikkei rises.

These massive currency moves are making banks and market makers extremely cautious. Reportedly the Commonwealth bank has suspended trading in GBP until Monday for retail customers.

Rather than be concerned about the UK being able to stand on its own, it appears that there may actually be more concern about what happens in the rest of the EU.  Spain will hold a general election on Sunday and it is hard to say if the financial fallout will encourage them to give the conservative Popular Party of Mariano Rajoy the majority it failed to secure in December, or embolden them to choose leaders that will also pursue life outside of the EU. Spexit may become the next big trending news item.

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What are the likely outcomes?

Interest rates are going to stay lower for longer.  Markets had been a somewhat skittish on the ‘threat’ of the Federal Reserve raising interest rates again, possibly as early as July.  That would seem to be off the table now, especially since Janet Yellen’s last interview which was quite dovish in the face of volatility.  Friday’s volatility will certainly have cemented that position.

Ten year bonds rose in price dramatically last night, as their corresponding yields to maturity fell.  The US ten year bond yield fell to 1.52% before finishing at 1.56%.  In Germany the ten year bond went back into negative territory (-0.05% p.a.) guaranteeing a nominal loss for anyone who bought last night and holds to maturity.

Central banks have promised and provided huge dollops of liquidity to ensure that brokerage houses can settle trades.  Mohamed El-Erian who rose to fame at PIMCO, and now serves as Chief Economic advisor at Allianz says that this is not a Lehmann moment, referring to the near contagion that followed when Lehmann Brothers failed in 2008.

Credit spreads may widen. Credit spreads are not a subject often discussed by retail investors, but it refers to the margin that investors demand to invest in bonds other than those issued by a government.  As credit spreads widen – as they do with uncertainty – the price of a corporate bond falls. This may result in a performance drag on corporate bonds (and managed funds that invest in them) as happened in the year to February 2016.

Volatility to remain a feature. The biggest problem with the Brexit is the unknown outcomes.  It will have impacts, but we don’t know what they are yet.  So as a result, volatility will continue. As we pointed out in the perspectives piece, it doesn’t necessarily mean outright losses, it just means big moves, both up and down.  It is important not to get suckered into reacting to either. In a previous blog (you can read it here) posted at what turned out to be the low point in February we warned: “It can be tempting to jump out of your investment position now, with the hope of getting back in later at a lower price, or once the situation is clearer.  But that too is fraught with danger, and the theory is much easier than the practice.  What if we get a 10% rally over the next two months starting from the day after you sell?”  As it happens we did get that rally, up 12% in fact, and those who sold in February would have missed it.  We are not saying you need to love volatility, but you do need to understand it and not allow it to control you.

Opportunities will be created. The irony of this is that as prices of fixed interest government securities rise and rates look like continuing to be lower for longer, shares are getting cheaper in price and presenting opportunities for the owner with strong hands.  Hard assets that generate income and are difficult to replace are also become more attractive.

The positioning of the Quill Group Investment Committee going into this period, and in fact for more than a year now, has been underweight in equities.  We have replaced that weighting that would normally be in shares with other un-correlated sources of return in hedge funds, trading funds and private equity.  New money going into balanced portfolios has had net weightings of around 25% to Australian shares and 20% to International shares, with a good part of the latter allocated to conservative managers.

The takeaway for us is this;  We have been positioned well.  Client portfolios are carrying adequate cash and fixed interest to avoid being forced sellers when the volatility swings to the downside.  There may be a point in the future that we want to have some of that cash to increase equity weightings.  Right now is not a good time to be a panic seller as long as you have that positioning.

As we alluded to in our headline, it might seem as if you should be doing SOMETHING to protect yourself.  Often that SOMETHING turns out to be the wrong thing at the wrong time if it is done as an act of panic.  With correct positioning and a portfolio of sensible investments we can advise you, “don’t just do SOMETHING, Stand there”. Hold your ground. Look ahead five years at what the companies you own today will be doing after all this Brexit dust settles.

It is official, in a shock referendum result, Britain has voted to leave the European Union. Now the world watches as our British counterparts dive into the political unknown. So, now we have an answer, what does this mean for Australians?

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Comment from Mark Beveridge – Quill Financial Planning

Markets were rallying all week on the expectation that the Remain vote would prevail.

Now that it seems that Brexit is on, there has been carnage as the positions built up by those convinced that Britain would remain in the European Union are reversed.

At the time of writing the ASX200 is down 183 points, or 3.42%

We can expect a big down market tonight in Europe and the UK, and no doubt in the USA as well.

The downside in those markets overnight will lead to further losses in the ASX200 on Monday when we open.

However, after the books are squared, and speculative positions un-wound, we think that cooler heads will prevail and when US and UK markets open again on Monday. Sometime during their trading day we should see a bottom and a bounce, from which point stocks that are unaffected by the Brexit issue will rebound.

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Three key areas the Brexit will impact

Our Currency and the Exchange Rate

• Based on an analysis by the the Commonwealth Bank’s Global Market Research, the British Pound could fall up to 10 per cent.
• The good news is that the Australian dollar could rise 8.3 per cent against the British Pound, however, against the US Dollar, the Australian dollar could see a fall of 2.5 per cent.

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The Share market

• The Brexit will bring extreme short-term volatility leading to turmoil in the UK and global markets.
• Due to the uncertainty surrounding the impact of the Brexit, Australia’s share market will probably fall along with other global markets.
• In a worst case scenario, the Brexit could trigger another financial crisis.
  • Banks may have more difficulty sourcing offshore funding
  • Term Deposit investors will be thinking about the $250,000 guarantee again
  • Australia may not avoid a recession like it did previously in 2008

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Superannuation

• Due to the nature of Super, being a long-term investment, the volatility mentioned above will have little impact on investors with 10 year time horizons.
• Unless you have your stash all in one nest, the short-term turmoil that may occur will only affect a small component of your super assets.

 

Sweeping changes were introduced to the superannuation system last night in the 2016 Federal Budget.  Some good, some bad.  The key takeaway message is that Superannuation still provides a highly tax-advantaged environment for retirement savings.  In our short blog today we look at the changes, both good and bad, and outline when the measures take effect.

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The Good:

Tax deductions for personal concessional contributions.  From 1 July 2017, you will be able to make additional tax-deductible super contributions directly from your own personal funds. Normally to claim a deduction, contributions would have to be made via ‘salary sacrifice’. The new measure puts employees on the same footing as self-employed people in terms of being able to top up their super with direct tax-deductible contributions. You will need to lodge a notice with your superfund.

Contributions till age 75 with no work test. Previously, after turning 65 you were required to work 40 hours in a 30 day period during the year to be able to make a super contribution. From 1 July 2017 that rule is gone, and you can put money into super whether working or not.

Increased thresholds for Low Income Spouse rebate. From 1 July 2017 you will be able to claim a $540 tax rebate for contributing to super for a spouse, even if his or her income is up to $37,000. The rebate phases out once the spouse income is over $40,000. The maximum rebate is achieved with a contribution of $3,000

Rebates on contributions tax for members earning less than $37,000. This measure takes effect from 1 July 2017 and will provide a tax offset of up to $500 for the member and has the effect of reducing the contributions tax to zero on modest contributions. Given the contributions tax is 15%, the rebate offsets all of the contributions tax on a $3,333 contribution.

Deferred Lifetime Annuities to get tax exempt status. Previously a superfund had to commence paying out a pension to obtain an exemption from tax on the fund earnings. This new measure to take effect from 1 July 2017 will allow the creation of new deferred income products, designed to provide more protection against running out of funds in old age.

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The Bad:

Capping pensions at $1.6 million.  From 1 July 2017, there will be a new cap on how much can be rolled into the zero taxed pension phase. The amount is $1,600,000. This measure is to apply to current and future accounts, so there is an element of retrospectivity within this that had not been seen previously.  Existing accounts will be measured for value as at that date, and amounts in excess will need to be moved back to what is currently called ‘accumulation phase’. Earnings on funds in the accumulation phase will continue to be taxed at 15% on income, with a 33% discount for capital gains when the asset was held for more than 12 months. In the period following 1 July 2017, you will be able to accumulate more than $1,600,000 in a pension account if the increase has come from earnings.  So that date is shaping up to be a critical one.  Self managed superfunds will be able to make a smooth transition of assets back into the accumulation phase if required since it is merely a ‘book entry’ for them.

Reduction to $25,000 for concessional contributions. Currently $30,000 for people under 50, and $35,000 for those over 50, this new lower limit will apply to all from 1 July 2017.  The opportunity still exists to use the old caps this year (before 30 June 2016) and next year while still available. There will be an option to accrue the unused component of your annual cap for up to 5 years, with the aggregating to start being measured from 1 July 2017.

Lifetime limit on non-concessional contributions. This measure took effect from budget night and limits your non-concessional contributions to a lifetime cap of $500,000. The existing annual limits of $180,000 still apply in the current year and the 2017 tax year, but the ‘bring forward’ rule is now limited to a maximum $500,000. Any new non-concessional contributions from today will need to be measured against all non-concessional contributions made since 1 July 2007. If you have already exceeded $500,000 since that date, then you cannot make any further non-concessional contributions. If you have already made contributions in excess of that amount they will be grandfathered, and you will be allowed to retain those amounts in the superannuation system. The lifetime cap will be indexed to earnings in line with the concessional caps. The next change in the cap will be a $50,000 step up when AWOTE has increased by 10% or more above the 1 July 2017 figure.

Lowering the threshold at which you pay 30% contributions tax.  The Division 293 tax which levied an extra 15% contributions used to take effect when you had assessable income over $300,000 but from 1 July 2017 it will be levied once your income exceeds $250,000.

Changes to Transition to Retirement Income Streams.  Sometimes called TTR pensions, or TRIS pensions, the strategy has been a popular way for advisers to help people salary sacrifice more into super, by simultaneously drawing on a pension from super.  The added advantage was that the earnings on the assets supporting the pension payments moved onto a tax-free status.  From 1 July 2017, the tax exemption on the earnings of these pensions will be removed, and the fund will be paying 15% tax on income with a 33% discount applying to capital gains over 12 months.  Retrospectivity also applies here. So it doesn’t matter that your pension commenced a year ago, last night, or next week. The status remains the same for now, but from 1 July 2017, the tax-exempt status on the income in the fund will change.  The planning opportunity here will be around what is called ‘condition of release’. Currently, and in future, it appears that as soon as you have met a condition of release and have unrestricted non-preserved status on the assets, a normal pension, with no cap on the withdrawal amount and no tax on the account earnings can be commenced.  It is important to consider the implications of current and proposed funds with your adviser.

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Summing up:

Our title says it all. Super is still super, providing many tax benefits to those who make use of the system. Political and budgetary pressures mean that the government has made it a little bit less ‘super’ by reducing and capping contributions and size of pensions. However, even for those with large super balances, the concessional tax rate of 15% will still be lower than their personal marginal rates if the assets were held outside of super.  Out of adversity comes innovation and we believe that there will be new retirement products created in the next few years that will help to ensure a comfortable retirement for those who get good advice on their retirement structuring. As always, be sure to keep in touch with your adviser on how the changes affect you, and what new opportunities are available to you.