Growing your super balance probably doesn’t seem like the coolest money goal to have, but it can help you achieve A LOT. 

Think of increasing your super balance like getting the mushroom power-ups in Mario to help you level up.

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There are a lot of ways to give your super balance a little boost…or a big one!

The biggest contribution to your super of course comes through your employer contributions - aka the super guarantee (SG).

This is currently set at 10.5% of your base salary. 

So, if you earn $70,000 per annum, your employer will be required to contribute $7,350 into your chosen super fund to go towards your retirement.

Aaaaand that amount is going up from 10.5% to 12% by 1 July 2025 - mo money in your pockets (when you retire)!

What about salary packaging?

So here’s where super contributions get JUICY.

Depending on your employer, you might also be able to set up an agreement to salary package, also known as salary sacrifice into superannuation.

The gist is, you sacrifice some of your before-tax salary, and have it directed to your super.

You and your employer come to an agreement where to set this up, and the benefit of saving money this way comes down to tax.

AKA ya might end up paying less income tax. 

The ‘why’ of this is kinda complicated, but hear us out!

When you salary sacrifice into your super, your contributions are taxed at 15%, which will certainly be lower than your marginal tax rate (if you’re above the tax-free threshold).

Let’s say you’re earning $70,000 per annum

• If you choose to salary sacrifice $10,000 of your salary: you’ll pay $1,500 in tax on that $10,000 (15% tax rate)
• If you don’t choose to salary sacrifice $10,000 of your salary: you’ll pay $3,250 in tax (32.5% marginal tax rate)

So you can see that by salary-sacrificing, you’re able to save $1,750 in tax. That’s great! Only downside is that you won’t be able to access this money until retirement.

Is there a limit to salary sacrifice super contributions?

Unfortunately, ya can’t have too much of a good thing. 

So, there is a limit to how much extra you can contribute to your super via a salary sacrifice agreement. 

And it’s $27,500 per financial year, including the amount your employer pays as part of the super guarantee.

As an example, if your employer is already contributing $7,350 to your super fund, then you can salary-sacrifice a maximum of $20,150.

What else can be salary-packaged?

There are a bunch of other neat options out there with salary packaging that can help you reduce your taxable income.

You can arrange with your employer to salary package a car through a novated lease, or salary package your work phone or computer, which can reduce your taxable income.

To learn more about how all this stuff works before we hit tax season, head over to the Flux Academy course: Getting Ready For Tax Time to learn more about taxes and how to make the most of it (legally)!