The talk on most millennials’ lips is housing affordability and saving for a deposit, so it comes as no surprise that this was an issue addressed by the Federal government in their latest budget announcement. The Budget, released in May 2017, included an option for utilising existing superannuation accounts and voluntary contributions up to $30,000 to assist first homebuyers with saving for a deposit.
While at UP Financial Planners we welcome more options for first home buyers to save and enter the property market, we urge interested individuals and couples to speak with an adviser about some saving options to suit their particular goals and needs.
Using a super account to save won’t necessarily work in everyone’s favour, so if you are considering taking the ‘super saving’ opportunity, look at:
- What is your super invested in?
- How volatile are your investments?
- Review the contribution caps for super and the annual thresholds for saving for a deposit so you don’t get taxed on excessive contributions
- Don’t just think you can ‘set and forget’ and hope that you have a great house deposit in a few years’ time. Super and saving plans need to be reviewed.
- Review your cash flow; are you earning a good wage but still feel like you have no money? We can look at other ways you could manage your money and save for a house deposit.
The 2017 budget and proposed super saving options are still just proposals and need to be passed through parliament before they become law and come into effect. They may be subject to change during this process.
If you’re hoping to buy your first home in the near future and have your eye on the super saving option, we suggest you talk to a financial adviser to understand if this is a path for you to achieve your goals, and how you can utilise the tools and strategies available to you.
Kellie & Cesar
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