Reap super rewards with some tweaking

A SUPER strategy to implement before June 30 is to take advantage of the Government's co-contribution if you earn less than $58,000.

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Reap super rewards with some tweaking

AN excellent superannuation strategy to implement before June 30 is to take advantage of the government's co-contribution if you earn less than $58,000 a year.

Ecential Financial director Phil Pilgrim said, depending on what you earn, you can "tweak the co-contribution'' to get the maximum benefit and you may contribute less than $1000.

"If I put into super $1000 after tax, the government will match that up to $1500, depending on what I earn. That's a 150 per cent return on your money for free,'' said the AMP-licensed financial planner.

"The government contribution shadows out between $28,000 and $58,000, so tweak your co-contribution and use the Australian Taxation Office calculator to work out how much a contribution will give you.''

For example, if you earn $42,000 and aim to put $1000 to super before June 30, your government contribution will be $849.

But the lowest amount you can contribute would be $566 to receive the same $849 benefit. That's a $434 difference to get the same outcome.

Mr Pilgrim said if you were watching the dollars but didn't want to miss the co-contribution, try to tweak it.

If you don't have a $1000 lump sum to throw into super just deposit smaller amounts monthly from after-tax pay. Superannuation earnings are taxed at a maximum 15 per cent in the accumulation  and are entirely tax free in the pension phase.

The maximum contribution from the Government is $1500.