8 out of 10 say the self-employed should be forced to pay super

A super fund member survey by industry body ASFA found 80% of respondents believe self-employed workers should be required to make superannuation contributions.

Three out of five (60%) of those who support the proposal are self-employed themselves.

The thing is, self-employed workers can face a double-edged sword when it comes to growing super.

On one hand, when you work for yourself as a freelancer or sole trader, responsibility for making super contributions typically lies with you – and that can be a challenge if your earnings shift around from month to month.

On the flipside, the self-employed can usually claim a tax break for concessional (pre-tax) contributions worth up to $27,500 annually (more if claiming unused concessional contributions since 2018/19).

Whichever way you look at it, there is a strong argument for the self-employed to grow their super.

ASFA says around one-fifth of these workers have no super at all in retirement.

Among those that do have super, it’s often far less than for other workers. ASFA^[1] found that in the run up to retirement (age 60-64), the self-employed have around half the super savings of PAYG employees.

As tax time approaches, it’s worth tucking a bit of cash into super. Everyone deserves the potential for dignity in retirement and that includes gig workers and the self-employed.

How to slash $2,000 from your winter power bill

As the mercury drops, our power bills are set to surge, and it’s not helped by many Australian homes failing to come up to scratch on energy efficiency.

From October, the minimum energy standard for new homes will be 7-Stars. But a new report from the Climate Council says homes built 20 or more years ago have an average rating of 1.5-Stars, which it describes as “little better than living in a tin shed”.

The good news is that it may be possible to slash around $2,000 off your annual power bill. And it doesn’t involve shivering your way through winter armed only with a hot water bottle and last season’s thermal underwear.

Climate Council Senior Researcher Dr Carl Tidemann believes too many households rely on “eye-wateringly expensive” gas, and he says electrifying a home’s cooking, heating and hot water can save a household between $336 and $1,311 a year.

Upgrading the thermal efficiency of your place by putting in insulation, and taking basic steps like finding and fixing draughts, could see you save an extra $354 to $1,561 annually.

Head to the Climate Council’s new home bill savings simulator to see what you could do around the home to take the heat out of your winter energy bill.

A ‘fixed term’ what?

Online savings accounts have been around for 20 years, and they’ve certainly stolen the limelight. Research by comparison site Mozo shows only one-third of Australians (36%) have ever used a term deposit.

Even more surprising, one in four people (28%) haven’t even heard of fixed term deposits or didn’t know they still existed.

While term deposits may seem a bit old fashioned, they can still play a role in a portfolio as a simple way to earn a guaranteed (albeit low) return.

The top ‘bonus savings’ rates on at-call accounts are sitting at 5% – the highest return in 10 years. The devil can be in the detail though because banks don’t give away that sort of money for free.

To earn bonus interest you need to meet a range of conditions – from making a set number of transactions in a month, to minimum monthly deposits and possibly restrictions on withdrawals.

If you can meet all the conditions, Mozo calculates that on a deposit of $10,000 paying 5%, you can pocket $512 in interest over the next 12 months.

If you only make the grade to meet the conditions half the time, that interest comes down to $268 over a year.

By contrast, the current top 12-month term deposit rate of 4.70% (with Gateway Bank) can let you earn $470 on $10,000 over the year ahead without having to tick a bunch of boxes or shuffle money around each month to maximise interest earnings.

You could be onto a winner with a high-rate at-call account – if you’re vigilant about bonus rate requirements. But to some extent the banks rely on at least some of us being disorganised, and not meeting the criteria in the small print to earn the top rate. The main point is check the interest rate on your spare cash – plenty of the red hot deals only apply to new customers.