James Coyle

James has over 35 years experience in financial services with particular expertise in two of the key components of retirement finance - Superannuation and the Age Pension. He is passionate about providing the guidance and support that can help older Australians enjoy their best possible retirement. He lives in regional Victoria surrounded by dogs and chooks.
Why you aren’t allowed to contribute more to super

Why you aren’t allowed to contribute more to super

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Help, I’m 76 and want to contribute more to my super, but I’ve been told I can’t!

This was the cry for help we received from Albert last week. He’s just turned 76 and came into some money unexpectedly, through a lottery win. He’s decided he doesn’t have anything to spend this $45,000 on and so wanted to put it into his super. The rules say you can’t contribute to a decumulation account such as an account based pension, so that was never going to work. But he also still has an accumulation account and he wanted to invest his winnings there. A friend at Albert’s service club told him that once you turn 75 you can no longer make any contributions. Hence his email seeking clarification.

The good news is that Albert’s friend’s summary is not entirely correct. Over-75-year-olds can continue to put money into super accumulation accounts.

The bad news is that there are only two specific ways of doing this. 

Let’s take time to have a refresh on the rules on contributions

Maria is getting an inheritance. But will she lose her pension?

Maria is getting an inheritance. But will she lose her pension?

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Australian society is witnessing the greatest intergenerational transfer of wealth ever seen. According to McCrindle Research, an estimated $3 trillion will be bequeathed to adult children over the next two decades. We don’t all have fathers like the driven, mega-rich Logan Roy from the Succession TV series who is leaving squillions to his kids. But many older Australians are now inheriting sizeable sums from their Depression era parents.

This week we spoke with Maria about her expected inheritance of $270,000. The consultation was triggered by her question: 

‘My 92 year old mother is in age care and I’ve been told that she is not expected to last long. She has no home, but some savings, so I expect to receive an inheritance of about $270,000 in the next few months.

I hope I don’t seem callous, but as I am 69 and receive a full Age Pension, I’m really scared of this inheritance threatening my current income. Can you tell me:

What do I need to do?

When I receive it, where do I put it (cash account, super, etc?)

What else do I need to know?

With Maria’s permission, we are sharing this question and our answers as this dilemma comes up often for baby boomer beneficiaries. 

The following suggestions are general in nature – not financial advice. But they helped Maria and will hopefully help others to understand rules around inheritances for retirees. Put simply, inheritance is no different to any other financial asset being assessed, it’s counted as an asset and deemed for the income test. There are, however, some opportunities for it to be exempt.

Getting the best return on cash

Getting the best return on cash

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According to the recent ACCC’s Retail Deposits Inquiry Final Report cash account holders would appear to be getting a bad deal but are able to do little about it. Not only are banks confusing and overly complex in their cash account offerings, but comparison websites are also open to commercial influences when offering details on cash rates. Today’s summary will help you understand what to look for when investing in cash.