BT LifeTime and Personal Super Review
Superannuation is money that belongs to you but is held on your behalf in a superannuation fund to be handed over to you when you retire. It is a mixture of life insurance, disability insurance and investment. The investment portion of your super fund can be placed in shares, cash, property or government bonds otherwise known as fixed interest. In a BT Lifetime Personal Superannuation Fund you will have more than 20 investment options to choose from. Taxation of superannuation fund earnings is usually lower than your marginal tax rate, it is presently 15 percent. Contributions made by your employer are also taxed at 15 percent.
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Choice and Flexibility
BT Lifetime Personal Super is designed to give you choice and flexibility as well as control over the money you are putting away for retirement. It is especially structured so that you are able to retain the same fund throughout your working life no matter how many times you change your employment.
If you are in a position that makes you eligible for BT Super Choice your employer can make direct contributions into your account and you are able to roll-over funds held in another superannuation account into your BT fund. It is easy to add to your BT Lifetime Personal Super Fund. You can grow your super by sacrificing part of your salary, your spouse can contribute, and if you wish you can pay additional after tax monies into the account. If you are eligible it also accepts government contributions.
The life insurance premium incorporated in your BT Lifetime Personal Super is arranged so that you actually save money. This is done by paying the premium from your before tax income and you are given the option of whether you want death cover alone, or death and total and permanent disability cover.
Protection Against the Unknown
Superannuation is a means of protecting yourself against the unknown while at the same time saving for your retirement. It does not allow you to take money from the fund before you reach retirement age unless there are very serious financial circumstances involved. Even when you have not reached retirement age you can convert some or all of the money in your fund if you have reached the age of 55 or what is known as your preservation age. This money can be converted into a transition to retirement pension. Such a pension will allow income payments to be drawn from it to supplement your wages. This is allowed so you can reduce your working hours as you age.
The conditions under which you can access money from your superannuation fund prior to retirement other than when you have attained your preservation age are as follows:
- Financial hardship. If you suffer from a serious medical condition, your home is going to be foreclosed on you or you have to meet funeral expenses you may be granted an early release. The assessment is made by the federal government department APRA.
- Account balance below $200. If your employment has been terminated and the money in your superannuation fund is no more than $200 you are able to withdraw these funds. You can also withdraw money from previously lost accounts if the money in the funds is no more than $200.
- Terminal Medical Condition. If your doctors can confirm that you are suffering from a terminal illness or injury and that you are not expected to live for more than another 12 months you can access your superannuation regardless of age.
- Permanent incapacity. If it can be proven that you would be unlikely to ever work again due to a permanent incapacity early release of you money can sometimes be allowed.
Nominate a Beneficiary
It is important that you make arrangements so that your superannuation benefits go to the right people should you die. To make certain of this you are able to nominate who you want as your beneficiary. If you don't nominate someone as your beneficiary your fund trustee will decide where the money goes. This might be a different person to that whom you would have chosen.
The Benefits of Being in a BT Lifetime Personal Super Fund
The benefits you will derive from having BT Lifetime Personal Super include the following:
- Investments that are tax effective. The maximum tax rate on your superannuation earnings is only 15 percent.
- Consolidating other funds. You are able to roll over any other super funds you might have been in previously, into your BT Lifetime Personal Superannuation Fund. This could save you extra account-keeping fees as well as reduce paperwork. If you have had numerous jobs over the years the chances are that you have another super fund floating around somewhere. Find it and combine it with your BT fund and increase your savings.
- Transition into retirement. If you are not ready to stop working but don't want to continue on a full time basis you can take advantage of the transition into retirement rules and access part of your super.
- Life insurance. Superannuation is a tax effective way to take out life insurance.
- Choosing your own investment options. BT Lifetime Personal Super gives you more than 20 options on where to invest your money. This means you are able to mix your investments so that they match your savings plans. These investment options are all managed by BT as well as numerous leading fund managers outside of BT.