ESSSuper (Emergency Super and State Super) has issued advice to its members on how to benefit from superannuation contributions made by their spouse.
In a statement, ESSSuper said members could help grow their spouse’s super by making a special spouse contribution or arranging for contribution splitting (also known as super splitting).
“But what’s the difference between contribution splitting and spouse contributions? And how can they benefit you?” ESSSuper asked.
“Explore the value of topping up your spouse’s super and how it can set you both up for a healthy financial future,” it said.
ESSSuper said contribution splitting could be done when the spouse had not retired and involved splitting up to 85 per cent of a financial year’s worth of one spouse’s concessional (before tax) super contributions into the other spouse’s super account.
“A carefully considered contribution splitting strategy not only allows you to support your spouse, it can also help build up your combined wealth and set you both up for a comfortable retirement,” the Fund said.
It said splitting contributions with an older spouse may enable earlier access to superannuation benefits; could help to manage the transfer balance cap and allow additional tax-free super contributions; and potentially increase Centrelink entitlements in retirement.
ESSSuper said spouse contributions allowed people to make non-concessional (after tax) contributions into their spouse’s super account.
“This can help balance your super accounts and is an excellent strategy for ensuring that your partner’s super won’t suffer as a result of a reduction in work hours, or an inability to work,” it said.
Further information on contributing to a spouse’s superannuation can be accessed at this PS News link.
