Starting work? A guide for teenagers

Becoming financially independent.


When you branch out on your own and start earning your own way through life you will immediately be subjected to paying tax on what you earn. That is if you earn enough to be taxed. To take advantage of any taxation benefits you will have to register with the Australian Taxation Office (ATO) to get yourself a tax file number. This tax file number will last you throughout your working life. If you don't have a tax file number you will be liable to pay 45 percent tax on all that you earn. Once you have your tax file number however you will not have to pay any tax at all on the first $18,200 you earn from June 1, 2012. For every dollar you earn over $18,200, up to $37,000, you will be taxed at 32.5 cents. The amount of tax you will have to pay on what you earn above those amounts can be ascertained from the ATO website.

Superannuation guarantee contributions

Once you start work and you are over 18 years of age earning a minimum of $450 monthly before tax, you will be entitled to superannuation guarantee contributions from your employer.

AustralianSuper - Pre-mixed Balanced Super Fund Offer

AustralianSuper - Pre-mixed, Balanced Super Fund

AustralianSuper - Pre-mixed Balanced Super Fund Offer

  • 2019 Finder Awards Winner: Best Super Fund - Balanced
  • Join and consolidate your super with the easy-to-use mobile app
  • Australia's best performing growth fund over 10 years*
*To June 2019, according to Chant West. Investment returns are not guaranteed. Past performance is not a reliable indicator of future returns.

Compare super fund accounts

Name Product Past Performance - 1 Year Past Performance - 3 Years Past performance - 5 Years Calculated fees p.a. on $50,000 balance
AustralianSuper - Pre-mixed, Balanced option
The Balanced option is a pre-mixed, MySuper fund that invests in a diversified range of asset classes.
AustralianSuper is an award-winning industry super fund and is the largest super fund in Australia.
Sunsuper Lifecycle Balanced
The Lifecycle Balanced option is a MySuper product that invests your super in a balanced fund until you’re near retirement.
Earn a Retirement Bonus of up to $4,800 when you open a new Income account. T&Cs apply.
QSuper Lifetime - Aspire 1
The Lifetime option is a MySuper product that adjusts your investment mix each 7-10 years as you get older.
QSuper is a member-owned super fund and is one of the largest super funds in Australia.
Virgin Money Super - Lifestage Tracker
The Lifestage Tracker is a MySuper product that invests in a range of asset classes in line with your age.
Earn Velocity Frequent Flyer Points for making contributions to your super. T&Cs apply.
LGIAsuper MySuper Lifecycle - Under 75
The LGIA MySuper Lifecycle option aims for higher returns while you’re under 75.
LGIA is a medium-sized, member-owned super fund open to all Australians.
Australian Catholic Super Lifetime - Grow
The LifetimeOne investment option is a MySuper product that changes your investment mix as you get older.
A Catholic super fund open to all Australians and designed for people working in Catholic education, healthcare or aged care.
Superestate Balanced Essentials
New Fund
New Fund
New Fund
The Balanced Essentials fund invests in a range of shares, residential property and other assets and has a medium level of risk.
Superestate focuses on investing your super in physical residential properties and charges some of the lowest annual fees in the market.
First State MySuper Life Cycle Growth
This MySuper product will invest your super in a pre-mixed Growth fund until you’re 60, then it’ll switch to Balanced.
First State Super is a not-for-profit super fund with more than 750,000 members around Australia.
HESTA - Core Pool
The Core Pool invests in a mix of asset classes and is an authorised MySuper product.
HESTA is an industry super fund open to all Australians and designed for employees in the health and community services sector.
BT Super for Life - MySuper Lifestage Fund
The MySuper Lifestage fund invests your super in a mix of asset classes depending on how old you are.
Westpac Group customers can manage their super alongside their day-to-day bank accounts.
Cbus Growth
The Growth fund is a pre-mixed investment portfolio and an approved MySuper product.
Cbus is a leading industry super fund for the building and construction industry, that’s open to all Australians.
BUSSQ MySuper Balanced Growth
The MySuper Balanced Growth option is a ready-made, diversified fund with a medium level of risk.
BUSSQ is an industry fund designed for the building and construction industry and open for all Australians.
Suncorp Lifestage Fund
The Lifestage Fund readjusts your investment mix every few years to reduce your level of risk as you get older.
A retail super fund that offers access to personalised financial planning and advice.
HostPlus Balanced
The Balanced fund invests your super in a range of assets and is designed for high long-term growth.
An industry super fund open to all Australians with a focus on the hospitality and retail sector.
MTAA My AutoSuper (Balanced)
The Balanced option is a MySuper product that invests in a range of asset classes aiming for medium to high long-term returns.
MTAA is a national super fund available to all Australians with a focus on the motor trades and automotive sector.
MLC MySuper Growth Portfolio
The Growth option is a diversified portfolio that aims for high growth over the medium to long term.
MLC is a large retail fund open to all Australians. MLC is the wealth management arm of National Australia Bank.
REST Super - Core Strategy
The Core Strategy is a diversified investment portfolio that balances risk and return, and is an authorised MySuper product.
REST is an industry super fund tailored towards the retail sector and open to all Australians with almost two million members.
UniSuper Balanced
The Balanced option is a MySuper product that invests in a mix of growth and defensive assets.
A flexible industry super fund for people who work in Australia’s higher education and research sector.

Compare up to 4 providers

The information in the table is based on data provided by Chant West Pty Ltd (AFSL 255320) which is itself supplied by third parties. While such information is believed to be accurate, Chant West does not accept responsibility for any inaccuracy in such information. Chant West’s Financial Services Guide is available at . Finder offers no guarantees or warranties about the data and we recommend that users make their own enquiries before relying on this information. Performance, fees and insurance data is based on each fund's default MySuper product. Where the performance, fees and insurance data for the MySuper fund vary according to the member's age, results for individuals between 40-49 years of age have been shown. Past performance is not a reliable indicator of future performance.

*Past performance data is for the period ending December 2018.

It makes no difference whether you are working full time or part time, every working Australian is entitled to receive the superannuation guarantee payments as this amount has been derived from previous pay increases that were given as superannuation payments. To be eligible you must be working at least 30 hours a week and it also includes contractors who are paid primarily for the labour they provide to an employer. Your employer will have to pay the superannuation guarantee, that is currently 9 percent of your before tax earnings, into your superannuation fund account every three months. These contributions are in excess of your salary or wages. You can choose your own superannuation fund or you can allow your employer to place the contributions into whatever fund he or she prefers. If you want your superannuation contributions to go to a fund of your choosing you employer has to give you a 'Standard Choice Form' that will allow you to put your choice of fund in writing.

The Australian minimum wage

If you are over 18 years of age your employer will have to pay you a minimum of $569.90 a week or $15 an hour. You can not be paid less no matter if you are an Australian citizen or not. If you are under 18 years of age the rate varies according to your age and your rights can be ascertained by visiting Fair Work Australia Website.

Your taxation obligations

At the finish of every financial year (June 30) you will receive a summary of what you have earned during the year along with the amount of tax your employer has deducted from your pay and forwarded to the ATO. You will then have to complete a taxation return and lodge it with the ATO by October 31 along with the certificate issued by your employer. If you have had too much withheld from your pay and sent to the ATO you will be entitled to a refund. If you have had too little deducted you will have to pay the ATO the difference. You will have to declare all your earnings for the year on your taxation return, not just that paid to you by your employer. You will also have the opportunity to claim certain deductions that will lower your taxable income and therefore lower the amount of tax you will have to pay.

Many people complete their own taxation return every financial year whereas others prefer to have a specialist tax accountant to do it for them. It depends a lot on how complicated your earnings have become over the year and how many deductions you are entitled to. If you are self employed and have completed many jobs over the year you may find it harder to complete your return than a person who has only had the one job and one income stream. In these more simple cases you can obtain a 'Tax Pack' from your post office or newsagent. All you need do in this case is to read the instructions, fill the form out as instructed and return it to the ATO with any relevant proofs of your claims. More recently you have been able to submit your tax return online through what is known as MyTax. You can do this by visiting the ATO website

Once you have this website open you simply click on the MyTax link and follow the instructions.

A good time to take out a life insurance policy

Now you are all set up it is a good time think about your life insurance. Life insurance is much cheaper to purchase when young as much of the premium you will have to pay is age based. The older you get the bigger risk you are to the life insurance company. It therefore makes sense to start your basic protection at this early stage. Although many life insurance companies promote term life insurance these days, because they can offer larger amounts of cover at a lower cost, you can only take such cover out for a certain term. Hence its name. Once this term has expired and you still require the cover you will have to take out the same insurance for a further term at a higher premium cost. All the money you have paid in premiums up to this time will be forfeited, unless you have died while covered and the amount you were insured for has been paid to your beneficiaries.

Find out more about the Benefits of Life Insurance for Teenagers

Whole life insurance presents a better option for the young

Alternatively you can take out whole life insurance and while young this is your best option. Whole life insurance will last you your whole life as long as you keep paying the premiums. There is no term involved and no increase in premium costs. It is a life insurance whereby a portion of the premium paid is diverted towards an investment, or savings. After a period this investment portion gives the policy a cash value of its own therefore you will always get your premium payments back if you need to surrender the policy for any reason. If you keep paying the premiums you will always be insured and the cost as you age will not be a problem. Many advise taking out a minimum of $50,000 in whole life insurance while young and as your responsibilities increase over the years you can add to this amount with lower priced term insurance.

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