I’m Max and I’m TDA’s new finance and economics journalist. I’m 27 and a quarter, I love dogs and I hate sunburn.

Billi and Sam asked me to jump in for the newsletter today, which is awesome, I think. (That feeling when you start a new job and over-analyse the comms from your boss for signs they think you’re good or bad.)

For my first feature, I thought superannuation would be a good topic. It’s been in the news heaps recently.

Just a quick note: As you’ll see, this newsletter is sponsored by Super Members Council, but they have had no influence over the editorial content of this piece.

Superannuation, or “super”, is a way of saving for retirement that is compulsory in Australia.

It means that employers are required by law to pay a percentage of your wages into an account (your super fund), which is then invested over time to help you build up savings for when you stop working.

In 1992, in response to growing concerns about an ageing population, the government introduced the Superannuation Guarantee.

The Guarantee is the key feature of Australia’s modern super system. It is the piece of law that makes it mandatory for your employer to pay a percentage of your wage (currently 11.5%) into your super fund.

When it was introduced, the World Bank described Australia as being at the “international forefront” of policies to address the costs of ageing.

Here are the key features of the system:

Employer contributions: Your employer must pay at least 11.5% of your ordinary time earnings (i.e., excluding overtime) into your super account.

Voluntary contributions: On top of this, you can put extra money into your super account, either individually or through your employer.

Growing your money: The money in your super account is managed by a Super Fund, which invests it in stocks, property, and bonds. Some people set up and manage their own super fund so they can have more say in how their money is invested.

Accessing your money: If you were born after 1 July 1964, you can access your super account once you turn 60 and have retired (or if you’ve not retired, once you turn 65).

Taking your money out: Once you qualify, you can withdraw it as a lump sum, an income stream, or a combination of both.

So these are some of the main features of Australia’s super system. Importantly, another component of this system is the tax breaks. These include:

Yes, as of 1 July 2025, your employer will be required to put in 12% of your salary, up from 11.5%.

Why? A few reasons, but a key one is that as we live longer, we are going to need more savings to fund our retirement.

Let me explain that more: Governments need people to have more money in their retirement accounts so that they are less reliant on governments. This is especially true as life expectancies increase, and the average number of years people are in retirement for also increases.

The government has announced a policy to tax earnings on super balances over $3 million.

As I mentioned earlier, as a general rule the money that goes into your superannuation is only taxed at a rate of 15% - and that is lower than all current income tax brackets. The Government is proposing to increase this tax rate to 30% for the money earned on super balances above the $3 million mark. That's because Treasurer Jim Chalmers says those “balances… are beyond what is necessary to fund a comfortable retirement.”

Now there is more detail to it - and there is some criticism of this policy. For example, the Opposition is against it.

Also, one thing to note is that less than 0.5% Australians actually have a super balance that is more than $3 million.

This needs a whole other explainer though (let me know if you’d like me to revisit it!)

That’s it from me for now. If you’ve liked this explainer, you can subscribe to TDA’s Finance Newsletter here.

Think retirement’s a later problem? Think again.

Superannuation (aka “super”) is basically your future salary - and how it grows depends on the choices you make now.

That’s where the Super Members Council comes in. They’re demystifying all things super: how it works, where it’s going, and how to make the most of it. No jargon, no lectures - just straight-up info to help you retire like a boss.

Whether you’re freelancing, side hustling, or climbing the corporate ladder, it pays to get your super sorted. Your future self will thank you.

Did you know the amount of superannuation you get paid is about to change?

As of 1 July, the minimum amount of super you receive is about to increase.

So what does this actually mean for you? We’ll explain in today’s podcast.