How life changes impact your superannuation: Marriage, divorce, and beyond

Life is full of changes, and many critical events can have a significant impact on your financial condition. Marriage and divorce are two major life events that can have a substantial impact on your retirement. Maintaining financial stability is dependent on your understanding of how to manage your superannuation throughout such transitions.

Whether your important life change is a divorce, a new relationship, or something altogether else, you should keep track of your superannuation funds and make changes as needed. In this piece, we will explain how these changes in your life may affect your super and what actions you can take to ensure you remain in control of your financial destiny.

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How marriage can affect your superannuation

When you marry, your financial life becomes inextricably linked to your partner’s, including your superannuation. Although superannuation is typically not available until retirement, saving for it early on in your marriage is critical.

Here’s how marriage may alter your super:

• Joint financial planning: Married couples may create joint financial plans that take both partners’ superannuation into consideration. Together, examining your super contributions allows you to ensure that you are both adequately prepared for retirement. It is usual practice to examine whether both partners are maximizing their super contributions or whether one partner can boost their contributions to compensate for the other’s lower balance.
• Beneficiary nominations: Once you’ve married, you must tell the beneficiary of your superannuation account. Many people fail to change this following a significant life experience, which might lead to troubles in the future. Choosing your spouse as a beneficiary ensures that, if something unexpected happens, they will receive your super.
• Spousal contributions: If one partner takes time from work (for maternity or paternity leave) or earns significantly less, the other partner can contribute to their spouse’s super fund. This is known as a spousal contribution, and it can help to balance retirement savings between two people.

The financial impact of divorce on your superannuation

Your superannuation may be significantly impacted by divorce because it is considered part of the property pool that can be divided between you and your ex-spouse. Here’s how a divorce could affect your super:

• Superannuation splitting: IDepending on the agreement or court order in a divorce settlement, your superannuation may be divided between you and your ex-partner. The division is often determined by the total value of both parties’ super funds.
• Updating your beneficiary: Changing your superannuation beneficiary should occur after a divorce. If you do not, your ex-partner may still receive your superannuation even after you have separated.
• Understanding your super balance: It’s crucial to know your superannuation balance and ensure that it is accurately reflected in your divorce settlement. Tracking your super can be challenging, especially if you’ve worked multiple jobs over the years. If you’re unsure of your balance or account details, you may need to find your superannuation number to ensure all accounts are accounted for. You can easily learn how to locate your superannuation number through this helpful :find your superannuation number.

Other life changes that impact your superannuation

In addition to marriage and divorce, other life events might have an impact on your superannuation. Here are a few examples:

• Starting a family: Having children might cause a shift in your financial emphasis. Many people choose to miss work to care for their children, potentially lowering total super contributions. Using spousal contributions or putting more to your super will assist to alleviate this.
• Changing jobs: could result in multiple superannuation accounts, which could result in unnecessary expenses. Consolidating your superannuation accounts helps you avoid paying extra. Throughout this process, you will require your superannuation number and data.
• Financial hardship or illness:If you have a serious illness or are experiencing financial difficulties, you may be able to access your super early. However, this can significantly reduce your retirement savings, so before you withdraw your super, thoroughly explore all options.

Managing your super during life changes

Whatever life throws at you, be proactive with your superannuation to support you. These guidelines can help you ensure effective management of your super throughout big life events:

1. Review and update your beneficiary nominations: Examine and modify your nominee as a beneficiary. Whether you have children, are divorced, or have been married, make sure the beneficiary listed on your superannuation account is regularly updated.
2. Track your super accounts: If you’ve had multiple jobs over the years, it’s simple to forget about them. Identifying your superannuation number is the first step in consolidating your accounts and decreasing fees.
3. Consult a financial planner: life often complicates finances. Working with a financial adviser can help you make informed decisions about your superannuation, ensuring your road to a secure retirement.
4. Make extra contributions where possible: Life events such as starting a family or changing employment can reduce your super contribution level. Making voluntary donations when possible will eventually help you improve your retirement savings.

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Final thoughts

Life events such as marriage, divorce, and childbirth can all have a significant impact on your retirement. Staying educated and making the necessary changes will help you ensure that, whatever happens, your financial future is secure. To maintain track of your retirement money, remember to update your beneficiary information, monitor your super accounts, and consider making voluntary contributions. Good superannuation management during these life events will set you up for a better financial future in retirement.