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Hi everyone, my name is Brad Zaknich 
GESB, and I'd like to thank you very much

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for logging onto today's recorded webinar,
so it's not a live one today,

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it's recorded and it's about investing
in super 101. So we're gonna go through

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the ideas of investing through 
superannuation compared to investing

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in other formats. So, for those who
haven't used webinars before, very simple

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technology, sit back and relax. Some of 
the normal interactive opportunities we

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have with webinars has been turned off
for today's session, obviously things like

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typing in questions and clicking send, 
you can't do that today because there's

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no-one to reply to them. So what we'll do 
is get through some of the housekeeping.

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What we're showing you here is what you
already would have received, well, in fact

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what you're going to be receiving, is a 
webinar survey follow-up email, we do

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still love to get feedback, even with 
recorded webinars, so if you wouldn't mind

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setting a few moments it takes to complete
that, that'd be greatly appreciated.

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The webinar, like I said, is being 
recorded, and you'll be able to sit back,

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watch it at your own leisure. You can move
forward, you can go back in the slides,

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and you can watch it as many times as you
like, and from my understanding, this

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webinar will be staying live on the GESB 
website, so probably around the end of

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the financial year, at which point we'll
most likely get a new presentation up.

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Now, I'd first love to show my respect
and acknowledge the traditional custodians

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of this land, of Elders past, present and
emerging, on which this event takes place.

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And then you've got the all-important 
disclaimer. When talking about

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superannuation, investing, money, finance,
it's important that you understand that

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we're not giving you personalised
financial advice today. My job today it to

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provide you with information, explain 
things, explain how things work.

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It's not to get you to make a decision
based on what I'm saying. So if you do

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need personalised financial advice, 
you'll need to go elsewhere to get that,

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as GESB only provides you general advice.
Now in today's session there is a lot to

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get through, some of which might be
concepts that you're familiar with,

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and some maybe not. So in this session 
we're gonna talk about the basics of

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investing, and we're gonna talk about 
things like income tax, and how that

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impacts investing, budgeting, where to use
your money, borrowing, and debt.

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Also going to talk about with investment
concepts, the idea of compounding

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interest, the value of superannuation, 
understanding the different asset classes

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that exist within super, and what 
investment options are available.

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Now hopefully you all know who GESB is,
I work for GESB, GESB is a state

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government department, and it just stands
for Government Employee Superannuation

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Board. Now we've been around for over
85 years, we've grown over $42 billion

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in funds under management as of 31st 
December 2024, and GESB, being a

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government department, we're a
not-for-profit organisation.

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So the only fees we collect from you, 
through your super, through your ??

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are to run the fund, we are 
not-for-profit. And our returns are

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competitive and long-term.

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In regards to GESB's product structure,
people often get a little confused,

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but it's quite simple. GESB at the top
of the tree there stands for Government

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Employee Superannuation Board. Below that
are the different schemes that we

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administer. Now we're got some old 
legacy schemes like the Pension scheme

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and the Gold State Super scheme,
we're not going to be talking about

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those at all today, okay, they don't sit
within the ??? of today's presentation.

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We're predominantly going to be talking
about superannuation, that are in the

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accumulation phase, and are accumulation
accounts, so West State Super, GESB Super,

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and some of the other invest, general
super funds that work in a similar fashion.

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When we speak about stuff that is general,
superannuation, I'll make that very

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well-known. When we're talking about 
anything that might be GESB specific,

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I'll also make that well-known. What we're
not going to talk about in great detail

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today, or if at all, are the allocated 
pensions. They are the retired products

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that most people use to draw down their
retirement savings.

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Well let's quickly talk about West State
and GESB Super because there are some

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differences between the two of them, 
and you need to be aware. So, West State

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Super was the default super fund for 
WA State Public Servants who commenced

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working for the government prior to 
15 April 2007. The reason that is

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important is that after April 2007, new
employees to the public sector might have

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had a GESB Super account open, or perhaps
some other super fund, Australian Super,

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Hostplus, something like that. The reason
it's important to know, is that most

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Australian funds like GESB Super, and most
other funds, are considered to be taxed

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super scheme. Why is this important?
The government allows super contributions

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to be contributed at a lower rate of tax
than your normal pay. We need to remember

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that super comes under the tax regime, 
and GESB super, like most Australian funds

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is a tax scheme and that simply means
when your employer puts money into your

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super fund, through your employers' 11.5%
guarantee, or you put extra money in

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through your payroll process called 
salary sacrifice. Those contributions are

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only taxed at 15%, compared to 
your normal tax rates through your income.

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But it happens on the way into your 
account, and while your money's still

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invested. If however you've got a West
State Super account, your money's are

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not taxed on the way in, because it's 
called an 'untaxed super scheme'.

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So the money's from your employers'
contributions and any salary sacrifice are

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not taxed on the way into your account so
the full contribution hits your account.

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Any investment earnings or growth in your
fund would normally be taxed at 15% in

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a regular fund, they are not taxed in 
West State Super whilst the money remains

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in West State Super, but what happens
however is when you take your money

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out of the West State scheme, that is 
when the 15% tax gets applied.

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So it's important that you understand the
difference, and there are some other

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differences to talk about in a little
while as well.

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Now, when we talk about tax, you need
to remember as well that the way the

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Australian tax system works is relative to
your income, is the more income that

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you earn, the more tax you generally pay.
So up to the first $18,200 you earn in

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earnings through your salary, through your
income, there is no tax applicable to that

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income for most Australians. But once your
salary gets above $18,201, up to $45,000,

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I shouldn't say salary, I should say
income, in that bracket your income is

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taxed at 16%, okay, for every dollar over 
$18,201, up to $45,000.

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Then, if you're earning over $45,001 per
year, the earnings between $45,001 and

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$135,00, that portion alone is taxed at 
30%. So people often think 'well I'm

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earning over $45 grand a year, I must be
paying 30% tax. Yes, but only on the money

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you're earning, above $45,000. And as your
salary goes into the new higher brackets,

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you pay more tax on the extra earnings. 
Now, as I said earlier, money's going into

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superannuation from your employer's 
contributions, and through the process

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called salary sacrifice. They are not 
taxed at your marginal, personal tax rate.

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They are instead taxed at 15%. So when you
talk about that, you can see that money's

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being earned over $45 grand are normally 
taxed at 30%, money going into your super

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only going to be taxed at 15% maximum. 
That is the benefit of superannuation,

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so let's go through this. Let's start
talking investing money, finances,

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all those sort of things, and first thing
when I talk about this is the basics of

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investing and knowing where your money
comes from.

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So knowing where your money goes is 
extremely important, being able to track

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your spending is an extremely important
part of looking after your money.

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Planning your goals, whether they be
short-term, medium-term, or long-term,

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basics of knowing where your money comes
from, and what you're gonna spend it on.

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But also being a smart borrower. There's 
nothing wrong with borrowing money,

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but some would argue, borrowing money to
purchase something that is declining in

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value may not be a smart borrow, but
that's up to the individual to decide how

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they want to do that. Also understanding
compounding interest.

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Interest earnt, understand that maybe I'm
making, for example, a 7% return on

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my money, but when you understand that
compounding interest is interest on top

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of interest on top of interest, that's 
extremely powerful.

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Albert Einstein once said 'compound 
interest is the eighth wonder of the

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world, he who understands it, earns it. 
He who doesn't, pays it.' Something to

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think about there. Well let's firstly talk
about budgeting.

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So there is a concept called the 
'bucketing approach', cause when we talk

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about budgeting, people get quite 
concerned and they think very heavily

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about every cent that this, and every 
individual item, and that is fair enough.

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But if you simplify things in budgeting
into a simpler approach, it might be as

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simple as dividing your income into three
buckets, or three aspects of your income.

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And you might allocate, for example, 50% 
of your income to your needs, so for

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example your home loan, your rent,
groceries, utilities and your insurances.

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So 50% is just a concept, you might have
more than that, you might have less,

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but when you identify an amount of
money, that is used for your needs, set

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that money aside and you know that your
needs are covered.

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And then you might have your wants, and
you might decide to allocate maybe 30%

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of your income to your wants. And they can
be things like your, upgrading needs,

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money's for evenings out, hobbies, 
sporting events, holidays, but upgrading

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needs we might talk about maintenance
on your home, new cars, things like that.

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And then you might decide to allocate 
20% of your income towards savings.

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And that might be an emergency fund for
when things go wrong, or maybe long-term

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savings for things off in the future, 
that might include other investments like

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superannuation, shares, property, but it 
also might include the overpayment of your

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debt, so paying extra money to pay off
loans might be considered to be savings.