Superannuation: why should I bother?

Superannuation (money put away for your retirement) can be very hard to care about when you’re at least 40 years away from retiring. But as the cost of living continues to rise, it’s becoming even more important to plan for the future from early in our working lives.

If you work in Australia, your employer must pay you a minimum of 9.5% of your total salary into a nominated superannuation fund. This compulsory saving is great – if you’re not self-employed. As we know, many PTs are self-employed so it’s our personal responsibility to ensure that we have the appropriate financial systems in place when pricing our sessions and putting money aside for our future. It can be very hard to think about this when you’re busy running your business, but investing some time and effort now will ensure your financial future is more secure.

PAA Business Development Manager, Julian Merola, learnt first-hand about how easy it can be to ignore the needs and responsibilities that seem so far into the future:

“When I started in this industry at the ripe young age of 18, I had no idea about superannuation and how important it was. All I knew was that I was getting paid $60 per hour – in cash! I thought it was fantastic. I was 18, earning $600-$900 a week. I was dazzled by the amount I was bringing home – superannuation and tax were two of the furthest things from my mind.

“It was only when I started studying my Bachelor of Business that I realised while cash is fantastic I was actually saving very little money. My studies opened my eyes to the business side of running my business. I soon realised that if I was to continue to work for myself, the responsibility of ensuring my financial future was on track rested solely with me. I started to practice better financial operations and allocate time to focus on the running of my business.”

Julian is not the only young trainer to fall into this trap. Young trainers entering the fitness industry are often misinformed and can lack the critical financial management skills that help maintain a sustainable career and build a secure future. $600 in weekly earnings would mean $57 needs to be put aside for superannuation.

It’s important to research and find the right super fund that meets your needs as a sole trader. Alternatively you can manager your own super fund through a retirement savings account with your bank.

The good news is that as a self-employed worker, you are entitled to some beneficial tax breaks for self-made super contributions as well as a helping hand from the government for income earners below a certain salary bracket. Setting up your superannuation payments may feel daunting, but there is help out there if you need it. The Superguru and Australian Taxation Office websites have useful tips on how to set yourself up. Accountants and financial planners can also help. Go on – take charge of your future today!

** This article constitutes general advice only. For more detailed information, speak to a financial expert.