Leaving your employer?

Transcription

1 Leaving your employer?

2 This guide outlines your super options when leaving your employer. What you ll find inside Moving on? 1 Choice of fund 3 Easing into retirement? 4 Transition to Retirement 6 General information 10 What happens if I don t do anything? 11 Choice of Fund form (inside the back cover)

3 1 Moving on? Your super can move with you no matter where you re headed.

4 2 Leaving your employer, for whatever reason, can be a stressful and busy time. The one thing you don t have to worry about is your super because you can join the Personal Plan (the Plan). What is the Personal Plan? The Plan is a sub plan of the Plum Superannuation Fund. If you leave your employer, you can continue to take advantage of the many benefits we offer by joining the Plan. What are the benefits? Your new employer can contribute to your Plan account all you have to do is fill in the Choice of Fund form (at the back of this booklet) and give it to your new employer; Insurance that moves with you we will transfer your insurance cover from your employer plan to the Plan subject to some conditions (refer to the Product Disclosure Statement (PDS) for more details). You may also be able to apply for additional levels of Life, Total Permanent Disablement (TPD) and Income Protection with premiums at group rates. The premiums will be deducted from your account; Competitive fees there s no entry fee for the Plan and the account fees are competitive, because we know higher fees means less money in your super account; 24 hour access to your super account via superau.bhpbilliton.com so you can stay in control of your account; You can boost your super by making additional contributions via Bpay; and Keeping your super with a fund you know and trust we ve got super solutions to support you in your working life and into retirement. Keeping your super in one account will mean you only pay one set of fees and you ll only have to deal with one set of paperwork. Where can I find out more? To find out more about the Plan, visit superau.bhpbilliton.com and click on the Personal Plan link. You can also download the Plan s PDS to find out more. How do I join? Joining the Plan is easy! In fact, most people don t have to do anything. If you leave your employer plan and have an account balance of $2,000 or more your account will automatically transfer to the Plan unless you choose otherwise.

5 3 Choice of Fund the power to choose! Did you know that Choice of Fund legislation means you can choose where you keep your super? Joining a new employer often means having to fill out another set of super paperwork, but you don t have to because you can stay with us as part of the Plan. All you have to do is fill in the Choice of Fund form at the back of this booklet and give it to your employer to process.

6 4 Easing into retirement? Congratulations! There are many things to consider, both financial and otherwise, as you approach retirement. Some of the questions you may want to ask yourself are: What kind of lifestyle do you want in retirement? How much money will you need to support your lifestyle? How long will your retirement last? Will you require government assistance? Do you want to keep your family home or are you considering downsizing? Would you like to continue working, but in a different capacity, such as volunteer work?

7 5 To help you turn a daunting experience into an exciting one we ve developed a transitioning to retirement checklist. This checklist is about empowering you with information and resources so you can make the most of your finances at this exciting time in your life, and make choices that are relevant to you. To get a copy of this guide, call us on between 8am and 7pm AEST, Monday to Friday, or visit us at superau.bhpbilliton.com. We may also be able to offer you a pension product to suit your needs. The product can be taken in two different ways so you can choose a strategy that best suits your personal circumstances. You can use our pension as a Transition to retirement strategy. A transition to retirement (TTR) strategy may be suitable for you if your retirement is on the horizon, but you still enjoy working. This strategy is available if you have reached your preservation age (55-60 depending on your date of birth, see table on page 10) allowing you to draw down on your super as a pension while still working. You may choose to reduce your working hours and supplement your income with the pension, or continue working at your current rate and boost your super with additional salary sacrifice contributions. There may also be significant tax benefits to taking a TTR strategy. Although TTR sounds complex, it s simple really. The case study on the following page shows how an effective transition to retirement strategy may be applied.

8 6 Transition to Retirement Case Study Michael, aged 55, currently earns a before-tax salary of $90,000per annum (or $67,400 after-tax) and receives 9.25% Superannuation Guarantee (SG) contributions from his employer. His priority is to build his superannuation savings for his retirement. Solution He decides to reduce his before-tax salary to approximately$73,325 per annum and salary sacrifice $16,675 per annum into his super fund to build his retirement savings (and remain under the concessional contributions limit). To receive the same after-tax income of approximately $67,400, he invests$300,000 (all taxable component) of his existing super into a TTR Pension and elects to receive taxable income payments of $13,405 in the first year. Salary sacrifice contributions are taxed at 15 per cent compared to Michael s personal marginal tax rate of 37 per cent per cent Medicare levy. Michael s entire pension income will be tax free when he reaches age 60. This TTR strategy is comfortably achieving Michael s stated objectives. Before strategy After strategy Before-tax salary $90,000 $73,100 TTR pension income $0 $13,405 Less tax payable $22,597 $19,327 After-tax income $67,403 $67,403 SG Contributions $8,325 $8,325 Salary sacrifice contributions $0 $16,675 Total contributions $8,325 $25,000 Note: Assume that Michael s employer continues to make SG contributions based on his package of $90,000 per annum even after he salary sacrifices into his super fund. If Michael was age 60 or over he would need to draw less from the TTR pension (compared to if he were 59) as the income would be tax free. Note, however, that the requirement to withdraw a minimum pension of 4% per annum would mean that a minimum amount of $12,000 would need to be withdrawn based on a balance of $300,000. While the after-tax income and SG contributions are the same in both scenarios, this strategy has the potential to boost Michael s retirement savings due to the salary sacrifice amount and tax savings.

9 7 After year Balance without TTR strategy Balance with TTR strategy Value added by strategy 1 $329,000 $333,000 $4,000 5 $471,000 $496,000 $25, $723,000 $810,000 $87,000 Strategy outcomes: income tax saving of $3,314; investment earnings within pension fund are tax free. The above example is for illustration purposes only and should not be relied upon. Any person considering this kind of strategy should seek their own financial advice from a licensed financial adviser who can take into account their personal financial situation, needs and objectives. Assumptions: These calculations take into account the 15% TTR Pension Offset Both the super and TTR pension investments earn a total beforetax return of 8.0% p.a. (split 3.5% p.a. income and 4.5% p.a. growth). The overall franking level on investment income is 23%. Super consists entirely of taxable component. Neither the super or TTR pension investments are cashed out. Salary does not change over the respective periods. The Concessional Contribution Limit ( CCL ) of $25,000 applies for the first year, increasing to $35,000 for each subsequent year. Indexation has not been applied to the CCL for future years. Income from the TTR pension is tax-free from age 60. The tax rates apply throughout (this includes the Low Income Tax Offset) The SG contributions are assumed to gradually increase to 12% as passed by parliament. You can use our online TTR calculator to see if this particular strategy suits your needs. To access this calculator simply visit us at superau.bhpbilliton.com, and click on the Tools & calculators link, and then transition to retirement calculator.

10 8 You can also take a pension product as an Account based strategy which means you can receive your super balance as a series of pension payments rather than as a lump sum. This strategy is available to members aged 55 and over who have met all the release conditions for their super. It also gives you the ability to invest your pension in a variety of investment options. You get to choose the frequency, amount and investment strategy for your account. What are the benefits? Making the most of your super by receiving your super as a pension rather than as a lump sum; You re in control you can choose the frequency, amount and how your pension is invested; You re not alone you can use our great education and support tools available via our website, superau.bhpbilliton.com; More money in your account you ll pay competitive fees; and The choice is yours you can choose from a wide variety of different investment options based on your risk profile. Want to find out more? To find out more about pensions, please visit us at superau.bhpbilliton.com and click on the Product and services link then the Plum Pension link where you can download the Product Disclosure Statement. How do I apply? Applying is easy. Simply call us on between 8am and 7pm AEST, Monday to Friday, or download the Application form via our website by clicking on the Forms & Publications link.

11 Seeking the right advice When making decisions about your super or retirement it s important to get advice from a licensed financial adviser to ensure that you re making the right decision for your personal circumstances. You can call us for help about your super. We can provide you with free phone based advice on a range of super strategies. If you need more in-depth help, you can access personal face-toface advice via a Momentum financial adviser. To access any of these services, just call us on , between 8.30am and 6pm AEST, Monday to Friday.

12 10 General information Taking some or all of your benefit as a lump sum Under legislation, your super must be preserved until you either permanently retire or reach preservation age. The table below can help you work out what your preservation age is. Your date of birth Preservation age Before 1 July July June July June July June July June July 1964 or after 60 Conditions of release Even if you have reached your preservation age, you will need to satisfy conditions of release before you can access your super. These conditions of release include: You permanently retire from the workforce on or after reaching your preservation age; You leave employment after age 60; You reach age 65; You become permanently incapacitated or die; or Your employment is terminated and your account balance is less than $200. Rolling your super into another fund You may wish to roll your super over to another complying super fund or plan by filling in a rollover form from a complying fund. We recommend speaking to a licensed financial adviser before making any major decisions about your super.

13 Choice of superannuation fund Fund nomination form If you are eligible, and would like your employer to make your superannuation guarantee (SG) contributions to your Plum Superannuation Fund (Fund) account you can complete this form instead of the Australian Taxation Office (ATO) Standard Choice Form which you may have received from your employer. The Fund is a complying superannuation fund and accepts contributions from any employer. This form also provides your employer with additional information, including how to make contributions. Please speak to your employer to determine whether you are able to choose your own superannuation fund. If you have any questions, please contact a Member Services Consultant on , any business day, 8.00am to 6.00pm, Melbourne time. I request that all my future superannuation guarantee contributions be made to my account in the Plum Superannuation Fund Your signature Your full name (Print in BLOCK LETTERS) Date Please complete and return this form to your employer. You do not need to send this form to Plum. / / Step 1 Complete your details (please use BLOCK letters) Surname (family name) Given names Title Member number (if known) BPAY reference number Tax File Number (TFN) Do we have your tax fi le number (TFN)? You can check on our secure website plum.com.au or on your six-monthly Member benefi t statement or by asking a Member Services Consultant. Step 2 Your chosen superannuation fund Fund name PLUM SUPERANNUATION FUND Fund phone number Australian Business Number (ABN) Superannuation Product Identifi cation Number (SPIN) PSN0100AU Fund address GPO BOX 63 MELBOURNE VIC 3001 IN CONFIDENCE when completed Trustee: PFS Nominees Pty Ltd ABN AFSL Fund: Plum Superannuation Fund ABN Administrator: Plum Financial Services Limited (Plum) ABN AFSL Level 4, 500 Bourke Street Melbourne Vic 3000 GPO Box 63 Melbourne Vic 3001 Telephone Fax Web plum.com.au

14 Choice of superannuation fund (continued) Information for your employer how to make contributions to the Fund with BPAY To make contributions with BPAY enter the Biller Code for: Employer contributions (including SG): Salary sacrifi ce contributions (before-tax) Member contributions (after-tax) and enter your employee s BPAY reference number Registered to BPAY Pty Ltd ABN by cheque To make contributions by cheque, please clearly indicate the employee s name, member number and the type of contribution being made. We encourage you to complete and send with the cheque a Contribution form which is available by contacting a Member Services Consultant on and available from our website plum.com.au Make cheques payable to Plum Superannuation Fund. Send cheques with your employee s details and contribution details to: Plum Financial Services Limited Reply Paid 63 MELBOURNE VIC 8060 Information for your employer Eligible employees can choose a fund as often as they want but you only have to accept one valid choice in a 12-month period. You must accept a valid choice of fund nomination and commence making contributions to the nominated fund within two months. For more information about choice of fund or the superannuation guarantee, contact the Australian Taxation Offi ce by calling You must keep this completed form for at least fi ve years. Employer to complete: Date nomination received: Date nomination processed: Confi rmation of complying fund status Plum Superannuation Fund (Fund) The Plum Superannuation Fund (ABN , SPIN PSN0100AU) is a resident, regulated superannuation fund. The Trustee of the Fund is PFS Nominees Pty Ltd (ABN , AFSL ) and it has elected to be regulated under the Superannuation Industry (Supervision) Act 1993 (SIS Act). Both entities can be found on the online register at abn.business.gov.au This confi rms that: The Fund is a complying and regulated fund within the meaning of the SIS Act; The Fund, and PFS Nominees Pty Ltd, as corporate trustee of the Fund, are subject to the SIS Act and the Corporations Act 2001 (Cwlth) and are regulated by the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC); The Trustee will ensure that the Fund continues to satisfy all legislative requirements and does not expect to receive a direction under Section 63 of the SIS Act; and The Fund is able to accept contributions made pursuant to the Superannuation Guarantee (Administration) Act 1992 (Cwlth), transfers and rollovers from other complying superannuation arrangements and provides for full vesting and preservation pursuant to the regulations under the SIS Act. PFS Nominees Pty Ltd has issued this notice in the capacity as Trustee of the Fund. Further information For employees: visit the ATO website at ato.gov.au; download from the ATO website the following publications: Lost something important? Super what you need to know and Super contribution caps; visit ASIC s website at moneysmart.gov.au for fi nancial tips, safety checks and to download Super decisions; phone the ATO on to ask about choosing a super fund. For employers: download from the ATO website the following publications: Super what employers need to know and Paying super your handy reference; subscribe to What s new at ato.gov.au to receive regular updates; phone the ATO on between 8am and 6pm, Monday to Friday, to speak to a tax offi cer. If you have any questions, please contact a Member Services Consultant on , any business day, 8.00am to 6.00pm, Melbourne time. IN CONFIDENCE when completed

15 11 What happens if I don t do anything? If you don t make any decisions about your super when you leave your employer, and your account balance is $2000 or more, it will automatically transfer across to the Plan. We ll write to you before this happens so you can make a choice, and within 30 days of this letter we ll transfer your balance. Shortly after the transfer you ll receive a Plan welcome kit which includes all the information you need to get active with your super.

16 Contact us for more information If you would like further information, visit the Member section of our website: superau.bhpbilliton.com or call us on between 8am and 7pm AEST, Monday to Friday. Important information An interest in the Worsley Alumina Superannuation Fund ABN (Fund) is issued by PFS Nominees Pty Ltd ABN AFSL (Trustee). The Fund administrator is Plum Financial Services Limited ABN AFSL (Administrator). This material has been prepared by the Administrator and it contains information that is general in nature. The information does not take into account your objectives, financial situation or needs. Before acting on the information you should consider whether it is appropriate having regard to your personal circumstances and seek licensed professional advice. It is recommended that you consider the Fund s Product Disclosure Statement (PDS) before you make any decisions about your superannuation. To obtain a copy of the Fund s PDS, call us on None of BHP Billiton, Worsley Alumina Pty Ltd, the Administrator, Trustee or any other company in the National Australia Group of companies accepts any liability whatsoever for any decision that is made on the basis of or in reliance of the information contained in this material. Please note that the information contained in this material is believed to be current as at February Any changes in the law or policy subsequent to this date have not been incorporated. Momentum Financial Advice is a service provided by GWM Adviser Services Limited (GWMAS) ABN AFSL through an agreement with PFS Nominees Pty Ltd as trustee of the Plum Superannuation Fund. GWMAS, the Trustee and Plum Financial Services Limited (Plum) are part of the National Australia Group of companies. Your financial adviser may charge you a service fee for advice, which can be deducted from your investments or be paid by direct invoice. GWMAS and your financial adviser may also receive a commission when applications are lodged for certain financial products (including life insurance). Further information on any fees, commissions and any other benefits received by GWMAS and your financial adviser for the services you receive can be obtained from the financial adviser s Financial Services Guide. Neither Plum nor the Trustee endorses or guarantees any advice provided by GWMAS or any financial adviser referred through the Momentum Financial Advice services. The Trustee, through its administrator, Plum, merely facilitates members access to these services and does not accept any liability for the services provided Plum Financial Services Limited ABN AFSL (Administrator). PLR3716 (02-14)