Are you self-employed … and are you contributing to your Super?

by | Apr 5, 2023 | Future Planning

If you are a small business owner, then you probably already know that you often neglect paying yourselves Super – why is that ??

Well, this is where we Financial Planners’ hear comments such as; I’m not required to; I’m too busy; it’s a long way away – I’ve got plenty of time … or any excess funds are re-invested back into the business or put towards paying down debt.

This inaction has resulted in self-employed people tending to have lower super balances than employees across all ages! Significantly lower – often up to 50% less. The importance of taking care of your retirement needs to be lifted up the priority list (even though the list is long!) 

According to MYOB [2016 SME Snapshot report] over a third of small business owners don’t have a solid roadmap to retirement, with many taking a chance that they can sell their business instead of contributing to their own superannuation.

Has this improved since 2016 …. sadly, probably not!

Have you looked at your super lately? Many SME owners, according to the snapshot, think that they need about $1 million to retire comfortably – however, over half of SME owners will not hit this mark.

In fact, research from the Association of Superannuation Funds of Australia revealed that almost a quarter of self-employed people have no super at all – now that’s scary (and sad)!

While superannuation might seem like the least important thing today, that will change, but often by then, there’s a good chance the best opportunities may have past you by. When it comes to saving money, the best time to start is now and that applies just as much to super as anything else.

It’s not too late to avoid slipping through the cracks … If you’re struggling with super as a self-employed person, you’re not alone. Here are two tips to kickstart your super and one to protect you against disaster:

  1. Automate your super savings

This will help ensure that super is never forgotten or it’s not left until the end of the financial year where the contribution is based on available cash and completed on a last-minute basis.

  1. Don’t leave tax money on the table

Superannuation can help you legally reduce the amount of tax you’re paying… and build long term retirement savings – a win/win!!

  • You may be able to claim all or part of a personal super contribution as a tax deduction.
  • You may be eligible for a government funded co-contribution – freeby!
  • You could explore the option of making a spouse contribution, if eligible you may be able to claim a tax offset up to $540 … a happy spouse!


And lastly,

  1. Ensure that your insurance has you covered

Check your superannuation funds insurance policy to make sure you are covered as a self-employed person. Different super funds use different definitions of ‘work’, and some funds don’t include self-employed work in their definition.

  • Is your cover suitable for you and does it offer ‘value for money’ remember these premiums are reducing your retirement savings!

Katrina Van Gunst  MFinPlan, AFP®  

SMSF Specialist Advisor

Principal & Financial Planner

General Advice disclaimer

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