Took a Career Break? 5 Ways to Catch Up on Your Super

How much could a career break really be costing your super and what can you actually do to catch up? 👶

This is the final episode in our five-part Get Rich series on superannuation, proudly brought to you by Australian Retirement Trust, and Molly's back with her newest sidekick, baby Amali! This week she sits down with Ruth to unpack five practical ways Aussie women can catch up on their super after time away from work, whether that's for raising kids, caring for elderly parents, or just taking some time out.

Whether you've paused work to look after a family member, took a few years off, or you've come back and have no idea if you're "behind," this episode is for you.

In this episode, you'll learn:

• The difference between concessional and non-concessional super contributions, and how much you can add to each
• How spouse contribution splitting works and why it's a fairness play, not a tax one
• What the government co-contribution scheme is and how it could add up to $500 to your super
• How the spouse contribution tax offset works if your partner tops up your account
• What the concessional carry-forward rule is and how to use unused caps from previous years
• Why checking your fund's fees, performance and whether to consolidate matters just as much as making contributions
• Molly's own experience using spouse splitting while on maternity leave
• Ruth's advice for anyone who's been avoiding their super altogether

Perfect for: Aussie women returning to work after a career break, mums on maternity leave, anyone who's taken time out to care for family, and women who want simple, no-jargon ways to feel more confident about their super.

The biggest takeaway from this episode? You don't need a huge overhaul, small, consistent moves now can make a massive difference to your super down the track. 🎧

The opinions and comments shared by people in this podcast are theirs alone. The information was accurate at the time of recording. This is general information only and is not based on your personal objectives, financial situation or needs. You should consider these factors and read the relevant Product Disclosure Statement and Target Market Determination before making any decision about any financial product. If you’re still unsure, speak with a financial adviser.

CHAPTERS

00:00 - Introduction: How Aussie Women Can Catch Up on Super After a Career Break
00:53 - Make Extra Super Contributions: Salary Sacrifice vs Paying In From Your Bank Account
01:53 - Concessional vs Non-Concessional Contributions: The $30,000 and $120,000 Super Caps Explained
02:36 - Got a Lump Sum or Inheritance? How to Put Up to $360,000 Into Super
02:53 - Spouse Contribution Splitting: Boost Your Super While You’re on Maternity Leave
04:06 - Government Super Co-Contribution: Up to $500 for Part-Time and Low-Income Earners
04:53 - Spouse Contribution Tax Offset: How Your Partner Can Top Up Your Super
05:27 - Concessional Carry-Forward Rule: Use Your Unused Super Caps From Previous Years
06:58 - Can You Carry Super Forward Into Future Years? Tax Deductions vs After-Tax Money
08:15 - Check Your Super Fund: Fees, Investment Options and Performance
08:55 - Benchmark Your Super Balance: The Red Flag You Can Spot by Talking to Friends
09:28 - Find Lost Super and Consolidate Accounts to Cut Admin and Insurance Costs
09:57 - Is Super Really “Set and Forget”? Why You Need to Set It Up Before You Forget It
10:24 - Returning to Work After Kids: Why Small Super Moves Now Make a Big Difference
11:35 - Behind on Your Super? Don’t Panic, Start Talking About It
12:30 - Wrap-Up: Take the Super Conversation to Your Next Girls’ Catch-Up

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TAKEAWAYS

SOUND BITES

 “You can only get a tax deduction on income you’ve already earned.”

“Don’t be afraid to talk about super.”

“Don’t have your super splattered all over the place, because there can be costs, admin costs.”

“It’s not as scary as it needs to be.”

“It’s generally a strategy that people do in the interest of fairness.” 

TRANSCRIPT

[00:00:00] Welcome to our special five-part Get Rich series on superannuation, where we are helping Aussie women get super at super. This series is proudly brought to you by the Australian Retirement Trust, trusted by over 2.4 million members. So over the next five episodes, we are making sense of super, so let's get into this week's episode. 

[00:00:19] And just a quick note, everything we cover is general information only and does not take into account your personal situation, so consider seeking professional advice before making any big finance or fashion decisions. 

[00:00:35] We are gonna cover five ways Aussie women can catch up on super after a career break because they might have been having a child, like we have little Amali here, my baby, um, joining us today, our special guest. Or maybe they took time off to look after elderly parents. Maybe they just wanted a few years off. 

[00:00:53] Uh, so we're gonna make this a quick fire session, Ruth. So we've got five different ways. The first one is they could make a contribution. How would that work? 

[00:01:02] Well, it depends on if you wanted to make, uh, a pre-tax and take advantage of the 15% tax rate. Mm-hmm. And for you to make a contribution using that particular concession method, it's usually done through salary sacrifice. 

[00:01:16] You go to your payroll, and you say, "I like the idea of the 15% tax. Can I do salary sacrifice?" So that's one, uh, way of making contributions. 

[00:01:25] And we've done a whole episode on salary sacrificing. We sure have. So check that one out. 

[00:01:29] The other way, then, Amali, is to just put it in from your bank account. Mm. So maybe you don't want to claim a tax deduction. 

[00:01:35] Maybe you have already exhausted your limit. 

[00:01:38] Yeah. 

[00:01:38] And you want to just put the money in from your bank account into your superannuation account. It's very much like transferring money from one bank account to another. Mm-hmm. You just get your BPay and reference number from your super fund for your account, and you just do it like a bank transaction. 

[00:01:52] It's very easy. 

[00:01:53] So, um, we've got concessional, which just means we get taxed at 15%. Yep. And the threshold this year is 30,000. That's right. 

[00:02:01] And then there's non-concessional, which means the tax isn't taken out, and the limit is 120. 

[00:02:07] Yes. So if you think about money in your bank account, it has already been taxed. 

[00:02:12] So the government give you a much more generous limit on that one, which means you can actually get 120,000 a year, this financial year, '25, '26 financial year. You can get $120,000 from your bank account into your super if you want to. Or let's say you sold an investment property or whatever and you've got a large lump sum, maybe you got an inheritance, you can use your future two financial years as well. 

[00:02:36] Mm-hmm. Which really means you could get up to $360,000 from your bank account into your superannuation account. Mm-hmm. We're not thinking tax here, okay? We're just putting it from the bank in. Okay. So we're not looking for tax. That's a different limit. Mm-hmm. And that's the after tax or the non-concessional. 

[00:02:53] Okay. So there are the two there. What about, can you get access to your partner's super if you are taking time off to look after a baby? 

[00:03:01] Look, if you're taking time out or one of the people in the household isn't working, one of the couple isn't working- Yeah ... so for example, when I was on maternity leave, and we did a strategy called spouse contri- or spouse splitting. 

[00:03:13] Yeah. Right? Yeah, spouse splitting. 

[00:03:14] So what spouse splitting is, is saying, okay, Amali, you might say to your partner, "You're working. You're getting employer contributions." 

[00:03:20] Yeah. 

[00:03:21] Um, meanwhile, I'm not working, so therefore I'm not getting employer contributions. Yeah. That doesn't seem very fair. 

[00:03:27] No. 

[00:03:27] You can actually redirect some of the employer contributions- 

[00:03:30] Yeah 

[00:03:30] that your partner is getting into your account. So you might say, "You know what?" While I'm at home not earning an income, therefore maybe not getting anything into my super- Mm ... let's, let's get half of your employer contributions and redirect them into my account in the interest of fairness. That's called contribution splitting. 

[00:03:49] Mm-hmm. 

[00:03:50] There's no big tax benefit. Yeah. You don't get an immediate tax break for it. It's generally a strategy that people do in the interest of fairness. Yeah. 

[00:03:57] I think that's very fair, and so does Amalie. You agree. 

[00:04:00] I can hear her agreeing with me there. I think that's great, too. And, um, so we've got special contribution or special splitting. 

[00:04:06] What about government co-contribution? 

[00:04:09] So then if... There's two, two spouse incentive, sorry, two government incentives that are good for getting contributions into your account if you're a low-income earner. So if you're going back to the workforce and maybe you're going back in part-time- 

[00:04:20] Mm-hmm ... 

[00:04:20] um, or maybe you're going into a lower paid role. 

[00:04:23] If your income is sort of under the 45-odd thousand dollar mark, there are government incentives. Co-contribution means if you put $1,000 into your account throughout the financial year, the government will give you an incentive up to 500. Mm-hmm. So that's a lovely way to keep the lights on- Yeah ... and to maybe bridge the gap if you're working part-time- Mm to some of the contributions that you might not be getting- Yeah ... if you were full-time. 

[00:04:46] Yeah. 

[00:04:46] So that's the, for the lower income earner. There's also one called the spouse contribution, different to splitting. 

[00:04:52] Okay. 

[00:04:53] Spouse contribution is whereby, say, you're at home- Mm ... and you're not earning or you're earning a low income. 

[00:05:00] And you've got a spouse earning a good income. If they put $3,000 into your account- 

[00:05:06] Mm-hmm ... 

[00:05:06] then they can q- and you're earning, uh, under 37,000, then they could qualify for a tax offset of up to $540. 

[00:05:14] Okay. 

[00:05:14] So between the government co-contribution and the spouse contribution, there's quite a, a nice little incentive there- Yeah to, to get a little bit of money in, particularly suitable for part-time, low-income earners. 

[00:05:27] And what if you haven't used your thresholds from previous years? Can you go back and top those up as well? 

[00:05:35] Ye- yeah, we talked about this in one of the previous episodes. Yeah. It's called the concessional carry forward rule. 

[00:05:40] So every financial year, we get a limit- Mm-hmm ... on how much money can go into our super- Yeah ... at that lovely 15% tax bra- bracket. And that's the one we're talking about for 30, 30,000. 

[00:05:51] And that's the $30,000 limit- Yeah ... for the, for this financial year. Now, let's say your employer puts 10,000 in. Yeah. Well, then you could put 20,000 in. 

[00:05:59] Mm. And you might do that through salary sacrifice or just put it in from your bank and claim a tax deduction. 

[00:06:05] Yeah. 

[00:06:05] You've got the ability to take advantage of the 15%. If, though, you have more than that- Mm ... and you think, "You know, I haven't been working. I'm back working full time. I now have capacity. I'd like to use more," what actually happens is the government look back over the previous four financial years as well. 

[00:06:21] So it's almost like a five-year average. 

[00:06:22] Yeah. 

[00:06:23] And they say, "Well, you know, you had previous years where you didn't use your full limit, and you bring it with you." 

[00:06:28] Yeah. 

[00:06:29] So essentially, it's not really per financial year. 

[00:06:32] Yeah. 

[00:06:32] It's almost looked at over a five-year period. 

[00:06:35] Okay. 

[00:06:36] The only catch there is you have to have less than 500,000 in your balance on the 30 June- Yeah before you do that. But it's a beautiful strategy for anyone who wants to really bump up that superannuation- Yeah ... and take advantage of the 15% tax bracket- 

[00:06:51] Mm ... 

[00:06:51] whilst you're doing it. She agrees with me. I can see her. She's like, "Absolutely." She's like, "That's a good strategy, Ruth." 

[00:06:58] And then what about, like, carrying it forward? 

[00:07:01] Like, can you, like, let's say you haven't been earning very much, but then you get a lump sum. Mm-hmm. You go back. You top up those thresholds. Can you bring it forward into the future? 

[00:07:10] Not the concessional one. Okay. So if I put it to you this way, if you're looking for, um, a tax deduction- 

[00:07:16] Mm ... 

[00:07:16] you can only get a tax deduction on income you've already earned. 

[00:07:20] Okay. 

[00:07:21] You need to know what that income was. So the $30,000 limit- Mm ... is based on the concessional method, the 15% tax, and all the years that came before that. So, you know, you might have a lot more than that to work with this year. When you're looking forward to financial years, we're only talking about after-tax money. 

[00:07:39] Mm-hmm. So this is the money that you might put from your bank into super. You're not looking for tax deductions. You're not looking at the tax- Mm ... the 15% tax. You say, "I have $1,000. I want to put it into super. I don't need to change it into-" Mm ... "a different type of contribution or claim a tax deduction." That has a much bigger limit of 120,000, but you can use the future years- Mm-hmm as well, which means you can actually get 360,000 into your account in one go. So after tax- Mm-hmm ... where you're not looking for tax concessions- No ... you look forward. If you're looking at tax concessions- 

[00:08:14] Mm ... 

[00:08:14] you're looking backwards. 

[00:08:15] Okay. Awesome. And then- What about fees and investment options? Are they levers we have? 

[00:08:21] Yeah. Look, you wanna make sure that you're with a good fund. Mm-hmm. So, you know, is your fund competitive? Is your admin fees competitive? How have they performed- Mm ... in investment returns compared to their peers? You know, every fund will display their default investment option, which is where most members sit, and it's quite easy information to find. 

[00:08:40] You'll often find it on the front page of their websites. Yeah, yeah. Even if you hop onto your website, you'll usually see it. But understand how your own super fund has performed in comparison to maybe your friend's. Yeah. And I always say to my girlfriends as well- Yeah ... don't be afraid to talk about super. 

[00:08:55] You know, you need to be talking about what your balance is- Mm ... and looking at people your age, and say, "Well, how much do you have? How much do you have?" And if you find that you're way behind on your balance, and you kinda earn the same amount of money, there's a red flag there. 

[00:09:09] Yeah. 

[00:09:09] That means you might be paying way too much fees- 

[00:09:11] Mm 

[00:09:11] or maybe you've got an underperforming fund. Yeah. So if you pick a girlfriend that you think you should be similar-ish to- Yeah ... with your super balance- Yeah ... but you don't really know how to compare, benchmark it off each other. Yeah. 'Cause a red flag can often pop up very quickly- 

[00:09:24] Yeah ... 

[00:09:25] with a discrepancy in balances like that, and it might be fees or investments. 

[00:09:28] Okay, awesome. Um, are there any other kind of strategies we can use to boost our super? I mean, there's obviously, like, finding any lost super. That's a great one- That's a good one ... 'cause that's yours. 

[00:09:37] Bringing it all together. 

[00:09:38] It's your super. Yeah. Bringing it all together. Are there any other strategies, or are they the main ones? 

[00:09:42] The only other thing I would say to people is it, it's a bit like them going back to the multiple accounts. Mm. Don't have your super splattered all over the place, because there can be costs, admin costs- 

[00:09:52] Yeah ... 

[00:09:53] that will really erode it, and insurance costs potentially that will really erode it. 

[00:09:57] Mm-hmm. 

[00:09:57] So there is this concept of, you know, isn't super a set and forget? 

[00:10:01] Yeah. 

[00:10:01] Yeah, it is. But you've gotta set- 

[00:10:03] Yeah. ... 

[00:10:03] before you forget, right? And the setting stage is being confident in the fund you're with. Yeah. Am I with a, a, a competitive priced fund? Mm. Are they giving me really strong investment returns? Yeah. Um, and then can I bring all my superannuation into that account? 

[00:10:17] Oh. Would that suit me- Mm ... so that I'm being efficient- Yeah ... with the administrative cost in particular that I'm paying for my superannuation? 

[00:10:24] Awesome. And then any final advice you'd have for women who are maybe coming back after a career break, and they've kind of been keeping their head in the sand a bit about their retirement, and they're like, "Oh, that's a future me problem." 

[00:10:36] Yeah. Well, you know what? Future you will look back and thank you if you actually do pay a little bit of attention to this. And I know when, you know, particularly if you're coming back after kids, the last thing you're thinking about after a tough day is your superannuation. I get that. But super is about planning. 

[00:10:51] It's a long-term investment and- Don't be put off by, by what you need to do. What you need to do can be tiny, and those little tiny moves that you make early on can have a big significant impact, whether it's a small contribution in, whether it's a change in your investment portfolio, whether it's bringing your superannuation together, picking a better fund to be with. 

[00:11:13] All of those things can make a huge difference at, at the end of the day. So I w- I don't want anyone who's coming back in to be worried. Um, if you're coming back after maternity leave, you've got years ahead of you before you can get your super till at least 60, and you can do so much with superannuation over a five and 10-year period if you want to. 

[00:11:31] Yeah. 

[00:11:32] So don't wait another 10 years. Don't wait another 10. Take action now. 

[00:11:35] Yeah. Exactly. 

[00:11:35] And I guess just wrapping up from everything we've learned through this series, what advice would you have for Aussie women who are behind? 

[00:11:41] Don't panic, number one. 

[00:11:43] Yeah. 

[00:11:43] Talk more about your super. Um, you probably have good company. 

[00:11:47] Mm-hmm. If you think you're behind, chances are you've got quite a few girlfriends who are probably in the same boat. Yes. There's also something very powerful about having group conversations and learning from other people. So, you know, I grew up in a time in Ireland where, in the '80s, we didn't talk about money. 

[00:12:02] Mm-hmm. It was a bit taboo. Yeah. It was a bit rude. Um, I'm finding that's changing. Yeah. And the only way we will empower ourselves to feel better is to learn about what other people are doing, how other people are feeling. Ask people, you know, find someone you're comfortable with and say, "You know, this is my super balance. 

[00:12:16] Is this good? What's yours?" And just get a better understanding because maybe you're not as bad as you think. 

[00:12:22] Yeah. 

[00:12:22] You know, maybe you're closer to that mark and to that target as you think. 

[00:12:25] Mm-hmm. 

[00:12:25] Reach out to your super funds. Talk more about it. Yeah. It's not as scary as it needs to be. 

[00:12:30] I love that. All right, ladies, at your next gals catch up, make sure you find out where everyone's super is and what it's invested in. 

[00:12:38] That's some good- Mm-hmm ... conversation for over the charcuterie. Yeah. Maybe have a couple of wine first. Char- charcuterie board. What is that? Charcuterie board. Charcuterie board. Charcuterie board. 

[00:12:46] Baby brain, Molly. Yeah. It's real. It's a real thing. 

[00:12:49] It's real. All right. Well, thanks, Ruth, for helping Aussie women get super at super. 

[00:12:53] My pleasure. 

[00:12:56] Thanks for listening. Now, remember that this was just general information, and it might not be right for you. Super rules can be complicated, and they change over time, so make sure you consider your own situation before acting on any of what we've talked about. For more information about today's episode, check out the show notes. 

KEYWORDS
superannuation, super for women, Aussie women super, catch up on super, super after a career break, super and maternity leave, career break super, how to boost your super, spouse contribution splitting, contribution splitting, spouse contribution tax offset, government co-contribution, concessional carry forward rule, concessional contributions, non-concessional contributions, salary sacrifice super, super contribution caps, super fees, compare super funds, consolidate super, lost super, super gender gap, retirement savings for women, financial education for women, Australian Retirement Trust, Get Rich podcast, Ladies Finance Club, Molly Benjamin, women’s finance podcast Australia