In a note to investors, Centuria general manager of the investment bond division, Neil Rogan, warned “there is going to be some change to superannuation”, adding that investors should “review their tax-effective options”.
“Proposed changes to superannuation may have a significant impact on the retirement savings plans for many Australians and they need to consider alternative tax-effective strategies,” he said.
The $500,000 lifetime non-concessional contributions cap was chief among these changes, and Mr Rogan noted that alternative strategies are “worth considering” for investors likely to reach this cap.
Investors should be mindful of their financial needs and goals in retirement before investing in alternative strategies, he added.
“Every investor’s situation is different so it’s important to look carefully and assess the pros and cons of all investment alternatives,” Mr Rogan said.
Investment bonds are one way in which investors can aim to be more tax-effective.
“For Australians who may be affected by possible changes to super, or those who would like to contribute more than the maximum tax-effective contribution each year, investment bonds should be on their consideration list,” Mr Rogan said.