Leaving Australia can be an exciting adventure, whether it’s for a short-term relocation or a permanent move. However, when it comes to your superannuation, it’s important to understand what happens to your retirement savings if you leave the country. In this article, we will explore the implications of leaving Australia on your superannuation and what options you have regarding your super funds.
What is Superannuation?
Superannuation, often referred to as super, is a retirement savings fund that is compulsory for most working Australians. Your employer is required to make contributions to your super fund on your behalf, which is designed to provide you with financial security in retirement. Superannuation funds are typically invested in various assets such as shares, property, and cash, with the goal of growing your savings over time.
What Happens to Your Super If You Leave Australia Temporarily?
If you are leaving Australia temporarily, such as for a working holiday or short-term employment overseas, your superannuation will remain in your Australian super fund. You can continue to make contributions to your super fund while you are overseas, either through voluntary contributions or by asking your employer to continue making contributions on your behalf.
It’s important to keep in mind that different countries have different tax laws and regulations regarding super contributions, so it’s advisable to seek advice from a Financial Advisor or tax professional to understand any implications on your super while you are living and working overseas.
What Happens to Your Super If You Leave Australia Permanently?
If you leave Australia permanently, you have several options regarding your super funds:
- Leave your super in your Australian super fund: You can choose to leave your superannuation in your Australian fund and continue to manage it from overseas. This option may be suitable if you plan to return to Australia in the future and want to keep your retirement savings in the Australian super system.
- Transfer your super to an overseas fund: Depending on the country you are moving to, you may be able to transfer your super to a qualifying overseas super fund. This option allows you to consolidate your super funds and manage your retirement savings in one account.
- Withdraw your super as a lump sum: In some cases, you may be eligible to withdraw your super as a lump sum if you are leaving Australia permanently. However, this option may have tax implications and it’s important to consider the long-term impact on your retirement savings before making a decision.
Key Considerations
Tax Implications:
When deciding what to do with your super when leaving Australia, it’s important to consider the tax implications of each option. Transferring your super to an overseas fund or withdrawing it as a lump sum may have tax consequences, both in Australia and in the country you are moving to. Seeking advice from a tax professional can help you make an informed decision based on your individual circumstances.
Investment Performance:
Before making any decisions regarding your super funds, it’s essential to review the investment performance of your Australian super fund and any overseas fund you are considering transferring to. Compare fees, returns, and Investment Options to ensure that your retirement savings are being managed effectively and in line with your financial goals.
Conclusion
Leaving Australia can have implications on your superannuation, but with careful planning and consideration, you can ensure that your retirement savings are managed effectively. Whether you choose to leave your super in Australia, transfer it overseas, or withdraw it as a lump sum, seeking advice from financial professionals can help you make the best decision for your financial future.