5 big money changes coming in 2025

The world of money doesn't stand still for long, and a flip of the calendar inevitably brings a fresh round of change. Here's what's coming in 2025. 

1. Employer super contributions to rise to 12% 

It's amazing to think that when compulsory employer super contributions were first introduced back in 1992, the contribution rate was a mere 3%. 

Fast forward to 2025, and by 1 July we will have reached the peak Super Guarantee (SG) rate of 12% of ordinary time earnings, up from 11.5% at present. That extra 0.5% may not seem like much but it has the potential to add thousands of dollars to our retirement savings. 

More broadly, reaching the 12% SG milestone is a reminder of the benefits of our super system. Compulsory employer-paid super has given Australian households $500 billion in savings that they otherwise would not have. Of this, around $35 billion is additional savings for people in the lowest 25% of income earners. What's not to celebrate?  

2. Super on Paid Parental Leave 

Starting 1 July 2025, new parents can expect to receive super contributions at 12% of their Paid Parental Leave (PPL) payment when they take time off to care for a new baby. 

This is a particularly valuable step forward for women, who enter retirement with 25% less super than men, often because of career breaks to raise a family.  

Minister for Social Services, Amanda Rishworth, says paying super on PPL will boost the retirement savings of around 180,000 Australian families each year.  

It won't mean extra money for families today. But it will help new parents enjoy greater financial security in the future. 

3. Help to Buy with a 2% deposit kicks off 

Think back to 2022, when one of Labor's key election promises was 'Help to Buy' - a shared equity scheme designed to help 40,000 low and middle-income families purchase a home of their own. 

Several years later, and after much political wrangling, Help to Buy has finally passed through parliament,  

Under the scheme, buyers need a minimum 2% deposit. The government funds up to 40% of the cost of a new home or 30% of the cost of existing homes, and this stake - plus a share of any capital gains - are repaid when the owner eventually sells the property.

Eligibility conditions apply and the scheme only offers 10,000 places nationally. However, before buyers begin lining up for Help to Buy, state and territory governments need to pass their own legislation for the scheme to operate. 

Queensland did this in mid-2024. With other states yet to follow, it's a case of 'watch this space' to know exactly when in 2025 Help to Buy finally gets off the ground. 

4. Minimum income for HECS repayments jumps to $67,000  

Three million Australians collectively owe more than $74 billion in student debt, and while tertiary qualifications can improve a graduate's income-earning potential, the accompanying HECS debt can be a roadblock to other important goals such as getting a first home loan. 

So it's good to learn that from 1 July 2025, graduates won't need to start repaying a HECS debt until their income reaches $67,000, up from $54,435 at present.  

In addition, repayments will be calculated only on income above the new $67,000 threshold rather than being based on total annual income. This lets new grads make smaller repayments in the early years of their loan. 

The indexation rate that applies to student debt is capped at the lower of either the Consumer Price Index (CPI) or the Wage Price Index (WPI). The federal government has already scaled back student debt balances from 2023 and 2024 to reflect this change.  

To further help reduce the nation's ballooning student debt, the federal government says it will knock 20% off all student loan debts if it is re-elected this year. 

5. Super balances over $3 million to pay 30% tax on investment returns 

From 1 July 2025, Australians with more than $3 million in super savings may face tax of 30% on their fund's investment earnings, up from 15% at present. 

While only 80,000 people are expected to be impacted by this change at present, the power of compounding returns could see many more Australians accumulate super in excess of $3 million in the future. 

That said, this is one issue to note in your diary in pencil rather than ink.  

If the new tax is enacted by the Senate in its next sitting, it could become a hot election issue as the Coalition has vowed to repeal the higher tax on fund earnings if it wins at the ballot box.