9:59:59.000,9:59:59.000 Hi everyone, my name is Brad Zaknich [br]GESB, and I'd like to thank you very much 9:59:59.000,9:59:59.000 for logging onto today's recorded webinar,[br]so it's not a live one today, 9:59:59.000,9:59:59.000 it's recorded and it's about investing[br]in super 101. So we're gonna go through 9:59:59.000,9:59:59.000 the ideas of investing through [br]superannuation compared to investing 9:59:59.000,9:59:59.000 in other formats. So, for those who[br]haven't used webinars before, very simple 9:59:59.000,9:59:59.000 technology, sit back and relax. Some of [br]the normal interactive opportunities we 9:59:59.000,9:59:59.000 have with webinars has been turned off[br]for today's session, obviously things like 9:59:59.000,9:59:59.000 typing in questions and clicking send, [br]you can't do that today because there's 9:59:59.000,9:59:59.000 no-one to reply to them. So what we'll do [br]is get through some of the housekeeping. 9:59:59.000,9:59:59.000 What we're showing you here is what you[br]already would have received, well, in fact 9:59:59.000,9:59:59.000 what you're going to be receiving, is a [br]webinar survey follow-up email, we do 9:59:59.000,9:59:59.000 still love to get feedback, even with [br]recorded webinars, so if you wouldn't mind 9:59:59.000,9:59:59.000 setting a few moments it takes to complete[br]that, that'd be greatly appreciated. 9:59:59.000,9:59:59.000 The webinar, like I said, is being [br]recorded, and you'll be able to sit back, 9:59:59.000,9:59:59.000 watch it at your own leisure. You can move[br]forward, you can go back in the slides, 9:59:59.000,9:59:59.000 and you can watch it as many times as you[br]like, and from my understanding, this 9:59:59.000,9:59:59.000 webinar will be staying live on the GESB [br]website, so probably around the end of 9:59:59.000,9:59:59.000 the financial year, at which point we'll[br]most likely get a new presentation up. 9:59:59.000,9:59:59.000 Now, I'd first love to show my respect[br]and acknowledge the traditional custodians 9:59:59.000,9:59:59.000 of this land, of Elders past, present and[br]emerging, on which this event takes place. 9:59:59.000,9:59:59.000 And then you've got the all-important [br]disclaimer. When talking about 9:59:59.000,9:59:59.000 superannuation, investing, money, finance,[br]it's important that you understand that 9:59:59.000,9:59:59.000 we're not giving you personalised[br]financial advice today. My job today it to 9:59:59.000,9:59:59.000 provide you with information, explain [br]things, explain how things work. 9:59:59.000,9:59:59.000 It's not to get you to make a decision[br]based on what I'm saying. So if you do 9:59:59.000,9:59:59.000 need personalised financial advice, [br]you'll need to go elsewhere to get that, 9:59:59.000,9:59:59.000 as GESB only provides you general advice.[br]Now in today's session there is a lot to 9:59:59.000,9:59:59.000 get through, some of which might be[br]concepts that you're familiar with, 9:59:59.000,9:59:59.000 and some maybe not. So in this session [br]we're gonna talk about the basics of 9:59:59.000,9:59:59.000 investing, and we're gonna talk about [br]things like income tax, and how that 9:59:59.000,9:59:59.000 impacts investing, budgeting, where to use[br]your money, borrowing, and debt. 9:59:59.000,9:59:59.000 Also going to talk about with investment[br]concepts, the idea of compounding 9:59:59.000,9:59:59.000 interest, the value of superannuation, [br]understanding the different asset classes 9:59:59.000,9:59:59.000 that exist within super, and what [br]investment options are available. 9:59:59.000,9:59:59.000 Now hopefully you all know who GESB is,[br]I work for GESB, GESB is a state 9:59:59.000,9:59:59.000 government department, and it just stands[br]for Government Employee Superannuation 9:59:59.000,9:59:59.000 Board. Now we've been around for over[br]85 years, we've grown over $42 billion 9:59:59.000,9:59:59.000 in funds under management as of 31st [br]December 2024, and GESB, being a 9:59:59.000,9:59:59.000 government department, we're a[br]not-for-profit organisation. 9:59:59.000,9:59:59.000 So the only fees we collect from you, [br]through your super, through your ?? 9:59:59.000,9:59:59.000 are to run the fund, we are [br]not-for-profit. And our returns are 9:59:59.000,9:59:59.000 competitive and long-term. 9:59:59.000,9:59:59.000 In regards to GESB's product structure,[br]people often get a little confused, 9:59:59.000,9:59:59.000 but it's quite simple. GESB at the top[br]of the tree there stands for Government 9:59:59.000,9:59:59.000 Employee Superannuation Board. Below that[br]are the different schemes that we 9:59:59.000,9:59:59.000 administer. Now we're got some old [br]legacy schemes like the Pension scheme 9:59:59.000,9:59:59.000 and the Gold State Super scheme,[br]we're not going to be talking about 9:59:59.000,9:59:59.000 those at all today, okay, they don't sit[br]within the ??? of today's presentation. 9:59:59.000,9:59:59.000 We're predominantly going to be talking[br]about superannuation, that are in the 9:59:59.000,9:59:59.000 accumulation phase, and are accumulation[br]accounts, so West State Super, GESB Super, 9:59:59.000,9:59:59.000 and some of the other invest, general[br]super funds that work in a similar fashion. 9:59:59.000,9:59:59.000 When we speak about stuff that is general,[br]superannuation, I'll make that very 9:59:59.000,9:59:59.000 well-known. When we're talking about [br]anything that might be GESB specific, 9:59:59.000,9:59:59.000 I'll also make that well-known. What we're[br]not going to talk about in great detail 9:59:59.000,9:59:59.000 today, or if at all, are the allocated [br]pensions. They are the retired products 9:59:59.000,9:59:59.000 that most people use to draw down their[br]retirement savings. 9:59:59.000,9:59:59.000 Well let's quickly talk about West State[br]and GESB Super because there are some 9:59:59.000,9:59:59.000 differences between the two of them, [br]and you need to be aware. So, West State 9:59:59.000,9:59:59.000 Super was the default super fund for [br]WA State Public Servants who commenced 9:59:59.000,9:59:59.000 working for the government prior to [br]15 April 2007. The reason that is 9:59:59.000,9:59:59.000 important is that after April 2007, new[br]employees to the public sector might have 9:59:59.000,9:59:59.000 had a GESB Super account open, or perhaps[br]some other super fund, Australian Super, 9:59:59.000,9:59:59.000 Hostplus, something like that. The reason[br]it's important to know, is that most 9:59:59.000,9:59:59.000 Australian funds like GESB Super, and most[br]other funds, are considered to be taxed 9:59:59.000,9:59:59.000 super scheme. Why is this important?[br]The government allows super contributions 9:59:59.000,9:59:59.000 to be contributed at a lower rate of tax[br]than your normal pay. We need to remember 9:59:59.000,9:59:59.000 that super comes under the tax regime, [br]and GESB super, like most Australian funds 9:59:59.000,9:59:59.000 is a tax scheme and that simply means[br]when your employer puts money into your 9:59:59.000,9:59:59.000 super fund, through your employers' 11.5%[br]guarantee, or you put extra money in 9:59:59.000,9:59:59.000 through your payroll process called [br]salary sacrifice. Those contributions are 9:59:59.000,9:59:59.000 only taxed at 15%, compared to [br]your normal tax rates through your income. 9:59:59.000,9:59:59.000 But it happens on the way into your [br]account, and while your money's still 9:59:59.000,9:59:59.000 invested. If however you've got a West[br]State Super account, your money's are 9:59:59.000,9:59:59.000 not taxed on the way in, because it's [br]called an 'untaxed super scheme'. 9:59:59.000,9:59:59.000 So the money's from your employers'[br]contributions and any salary sacrifice are 9:59:59.000,9:59:59.000 not taxed on the way into your account so[br]the full contribution hits your account. 9:59:59.000,9:59:59.000 Any investment earnings or growth in your[br]fund would normally be taxed at 15% in 9:59:59.000,9:59:59.000 a regular fund, they are not taxed in [br]West State Super whilst the money remains 9:59:59.000,9:59:59.000 in West State Super, but what happens[br]however is when you take your money 9:59:59.000,9:59:59.000 out of the West State scheme, that is [br]when the 15% tax gets applied. 9:59:59.000,9:59:59.000 So it's important that you understand the[br]difference, and there are some other 9:59:59.000,9:59:59.000 differences to talk about in a little[br]while as well. 9:59:59.000,9:59:59.000 Now, when we talk about tax, you need[br]to remember as well that the way the 9:59:59.000,9:59:59.000 Australian tax system works is relative to[br]your income, is the more income that 9:59:59.000,9:59:59.000 you earn, the more tax you generally pay.[br]So up to the first $18,200 you earn in 9:59:59.000,9:59:59.000 earnings through your salary, through your[br]income, there is no tax applicable to that 9:59:59.000,9:59:59.000 income for most Australians. But once your[br]salary gets above $18,201, up to $45,000, 9:59:59.000,9:59:59.000 I shouldn't say salary, I should say[br]income, in that bracket your income is 9:59:59.000,9:59:59.000 taxed at 16%, okay, for every dollar over [br]$18,201, up to $45,000. 9:59:59.000,9:59:59.000 Then, if you're earning over $45,001 per[br]year, the earnings between $45,001 and 9:59:59.000,9:59:59.000 $135,00, that portion alone is taxed at [br]30%. So people often think 'well I'm 9:59:59.000,9:59:59.000 earning over $45 grand a year, I must be[br]paying 30% tax. Yes, but only on the money 9:59:59.000,9:59:59.000 you're earning, above $45,000. And as your[br]salary goes into the new higher brackets, 9:59:59.000,9:59:59.000 you pay more tax on the extra earnings. [br]Now, as I said earlier, money's going into 9:59:59.000,9:59:59.000 superannuation from your employer's [br]contributions, and through the process 9:59:59.000,9:59:59.000 called salary sacrifice. They are not [br]taxed at your marginal, personal tax rate. 9:59:59.000,9:59:59.000 They are instead taxed at 15%. So when you[br]talk about that, you can see that money's 9:59:59.000,9:59:59.000 being earned over $45 grand are normally [br]taxed at 30%, money going into your super 9:59:59.000,9:59:59.000 only going to be taxed at 15% maximum. [br]That is the benefit of superannuation, 9:59:59.000,9:59:59.000 so let's go through this. Let's start[br]talking investing money, finances, 9:59:59.000,9:59:59.000 all those sort of things, and first thing[br]when I talk about this is the basics of 9:59:59.000,9:59:59.000 investing and knowing where your money[br]comes from. 9:59:59.000,9:59:59.000 So knowing where your money goes is [br]extremely important, being able to track 9:59:59.000,9:59:59.000 your spending is an extremely important[br]part of looking after your money. 9:59:59.000,9:59:59.000 Planning your goals, whether they be[br]short-term, medium-term, or long-term, 9:59:59.000,9:59:59.000 basics of knowing where your money comes[br]from, and what you're gonna spend it on. 9:59:59.000,9:59:59.000 But also being a smart borrower. There's [br]nothing wrong with borrowing money, 9:59:59.000,9:59:59.000 but some would argue, borrowing money to[br]purchase something that is declining in 9:59:59.000,9:59:59.000 value may not be a smart borrow, but[br]that's up to the individual to decide how 9:59:59.000,9:59:59.000 they want to do that. Also understanding[br]compounding interest. 9:59:59.000,9:59:59.000 Interest earnt, understand that maybe I'm[br]making, for example, a 7% return on 9:59:59.000,9:59:59.000 my money, but when you understand that[br]compounding interest is interest on top 9:59:59.000,9:59:59.000 of interest on top of interest, that's [br]extremely powerful. 9:59:59.000,9:59:59.000 Albert Einstein once said 'compound [br]interest is the eighth wonder of the 9:59:59.000,9:59:59.000 world, he who understands it, earns it. [br]He who doesn't, pays it.' Something to 9:59:59.000,9:59:59.000 think about there. Well let's firstly talk[br]about budgeting. 9:59:59.000,9:59:59.000 So there is a concept called the [br]'bucketing approach', cause when we talk 9:59:59.000,9:59:59.000 about budgeting, people get quite [br]concerned and they think very heavily 9:59:59.000,9:59:59.000 about every cent that this, and every [br]individual item, and that is fair enough. 9:59:59.000,9:59:59.000 But if you simplify things in budgeting[br]into a simpler approach, it might be as 9:59:59.000,9:59:59.000 simple as dividing your income into three[br]buckets, or three aspects of your income. 9:59:59.000,9:59:59.000 And you might allocate, for example, 50% [br]of your income to your needs, so for 9:59:59.000,9:59:59.000 example your home loan, your rent,[br]groceries, utilities and your insurances. 9:59:59.000,9:59:59.000 So 50% is just a concept, you might have[br]more than that, you might have less, 9:59:59.000,9:59:59.000 but when you identify an amount of[br]money, that is used for your needs, set 9:59:59.000,9:59:59.000 that money aside and you know that your[br]needs are covered. 9:59:59.000,9:59:59.000 And then you might have your wants, and[br]you might decide to allocate maybe 30% 9:59:59.000,9:59:59.000 of your income to your wants. And they can[br]be things like your, upgrading needs, 9:59:59.000,9:59:59.000 money's for evenings out, hobbies, [br]sporting events, holidays, but upgrading 9:59:59.000,9:59:59.000 needs we might talk about maintenance[br]on your home, new cars, things like that. 9:59:59.000,9:59:59.000 And then you might decide to allocate [br]20% of your income towards savings. 9:59:59.000,9:59:59.000 And that might be an emergency fund for[br]when things go wrong, or maybe long-term 9:59:59.000,9:59:59.000 savings for things off in the future, [br]that might include other investments like 9:59:59.000,9:59:59.000 superannuation, shares, property, but it [br]also might include the overpayment of your 9:59:59.000,9:59:59.000 debt, so paying extra money to pay off[br]loans might be considered to be savings. 9:59:59.000,9:59:59.000 And when you break it down into 50%, 30% [br]and 20%, it's a very reasonable starting 9:59:59.000,9:59:59.000 point, you might decide to put more money[br]into savings, less into wants, but by 9:59:59.000,9:59:59.000 having structure, makes it easier to stick[br]to that structure, and identify what 9:59:59.000,9:59:59.000 you're going to be putting your money[br]into. 9:59:59.000,9:59:59.000 Let's now talk about being a smart [br]borrower. Borrowing money is for most 9:59:59.000,9:59:59.000 people, a necessity in life, for certain[br]things, but not all debt is equal, it will 9:59:59.000,9:59:59.000 depend on the purpose of the loan, [br]it will depend on the interest rates 9:59:59.000,9:59:59.000 you're paying, how often and how much[br]you payments are going to be, and it 9:59:59.000,9:59:59.000 should be consolidating different debts,[br]or different loans, into one. 9:59:59.000,9:59:59.000 So for example, when they say 'not all[br]debt is equal', if you're borrowing money 9:59:59.000,9:59:59.000 from a bank or institution, as an [br]example, and maybe you're borrowing it 9:59:59.000,9:59:59.000 and you're having to pay, 5% interest[br]or 6% interest to borrow that money, 9:59:59.000,9:59:59.000 but maybe you're borrowing that money[br]to purchase something that's going to 9:59:59.000,9:59:59.000 increase in value by 7, 8, 9% per year, [br]that might be said as being 'good debt'. 9:59:59.000,9:59:59.000 Whereas 'bad debt' might be something as[br]simple as paying for a holiday, where you 9:59:59.000,9:59:59.000 don't have much to show for it at the [br]end and you're paying extra when you get 9:59:59.000,9:59:59.000 back by way of interest. So understand, [br]borrowing money is not necessarily a bad 9:59:59.000,9:59:59.000 thing, but understanding when you should, [br]shouldn't borrow to purchase things is 9:59:59.000,9:59:59.000 something that you have to decide. 9:59:59.000,9:59:59.000 Now lets now talk about compounding [br]interest, I'm gonna go through the example 9:59:59.000,9:59:59.000 we quite often use. Compounding interest[br]is basically earning interest on top of 9:59:59.000,9:59:59.000 previously earned interest. So let's look[br]at a case study of Jenny, who invests 9:59:59.000,9:59:59.000 $10,000 over a five year period. Now she's[br]gonna, let's say in her example, she 9:59:59.000,9:59:59.000 receives 5% per annum compounded interest,[br]compounded on a monthly basis. 9:59:59.000,9:59:59.000 Now, and the end of five years, her[br]investments actually gonna grow to $12,834. 9:59:59.000,9:59:59.000 She's not just earning 5% on $10,000, [br]so let's see how this works. 9:59:59.000,9:59:59.000 If she invests $10,000 at the start of [br]year 1, by compounding interest at 5% 9:59:59.000,9:59:59.000 per annum monthly, she's doesn't end up[br]with $500, which would be if she 9:59:59.000,9:59:59.000 compounded once, she ends up with $512, [br]it's actually more than 5% over the 12 9:59:59.000,9:59:59.000 months because it's been compounded [br]monthly. So at the beginning of the next 9:59:59.000,9:59:59.000 year she's got $512, which she earns 5% [br]interest compounded monthly, for the next 9:59:59.000,9:59:59.000 12 months, she accumulates $538. [br]Ends up with $11,049, and you can see over 9:59:59.000,9:59:59.000 five years, the interests that's been [br]compounded grows, 512, 538, 565, 594, 625. 9:59:59.000,9:59:59.000 So compounding interest, we leave [br]investments alone, and they compound on 9:59:59.000,9:59:59.000 top of each other. It's investments' [br]interest on top of the last lot of 9:59:59.000,9:59:59.000 interest returns. That's where leaving [br]things long term can generate greater 9:59:59.000,9:59:59.000 levels of interest, because it's not [br]simple interest, it's compound interest. 9:59:59.000,9:59:59.000 And that's where these slides come in,[br]excuse me, time is money. 9:59:59.000,9:59:59.000 People often talk about 'timing the market',[br]it's often more important to spend time 9:59:59.000,9:59:59.000 in the market. What do we mean by that?[br]Well let's say for example, you've got 9:59:59.000,9:59:59.000 a 20-year-old, a 30-year-old, a 40 and a [br]50-year-old, who all of a sudden decide, 9:59:59.000,9:59:59.000 with a starting balance of nothing, [br]they want to put an extra $50 a fortnight 9:59:59.000,9:59:59.000 perhaps even less, in superannuation. [br]So let's just assume this is extra money 9:59:59.000,9:59:59.000 you're putting into your super, above and [br]beyond what you might already be getting. 9:59:59.000,9:59:59.000 What difference will it make by putting[br]$50 a fortnight, now let's assume an 9:59:59.000,9:59:59.000 annual earning rate of roughly 7.8%,[br]so you're probably in the growth plan. 9:59:59.000,9:59:59.000 Now if you start when you're 20, an extra[br]$50 a fortnight, taken out of the 9:59:59.000,9:59:59.000 conversation inflation and things like[br]that, when you get to 60, so after 40 9:59:59.000,9:59:59.000 years, you'll have $340,758 extra sitting [br]in your account. 9:59:59.000,9:59:59.000 By only putting in $50 a fortnight. [br]Now if you don't start until you're 30, 9:59:59.000,9:59:59.000 now I've got $154,000, you don't start[br]until you're 40, about $64,000, 9:59:59.000,9:59:59.000 you don't start until you're 50, it's [br]$21,000. Now you can see, even though 9:59:59.000,9:59:59.000 they're only 10-year periods separating[br]each starting point, the amounts of 9:59:59.000,9:59:59.000 difference are massive. Because the person[br]starting making contributions earlier, 9:59:59.000,9:59:59.000 is getting compounding interest every[br]month on top of the contributions that 9:59:59.000,9:59:59.000 have already grown. And that's why the [br]balance can be quite large, by putting in 9:59:59.000,9:59:59.000 significantly small amounts of money, [br]if you start really early. 9:59:59.000,9:59:59.000 Well let's now focus on that $345,000 [br]because we know that starting at 20, 9:59:59.000,9:59:59.000 over 40 years, should generate a figure [br]that's similar to that. 9:59:59.000,9:59:59.000 But what if, you need that amount of [br]money, but you don't start when you're 20. 9:59:59.000,9:59:59.000 Well if you don't start 'til you're 30, [br]to meet the same objective, you'll need to 9:59:59.000,9:59:59.000 put in $112 a fortnight, significantly[br]more. If you don't start 'til you're 40, 9:59:59.000,9:59:59.000 now you've gotta do $270 a fortnight, [br]for a much shorter period of time. 9:59:59.000,9:59:59.000 And if you don't start 'til you're 50, [br]now it's $807 per fortnight. 9:59:59.000,9:59:59.000 So this is where compounding interest can[br]work against you, the longer you wait to 9:59:59.000,9:59:59.000 start making investments. And because[br]superannuation can't be accessed, 9:59:59.000,9:59:59.000 generally until the age of 60 anyway, [br]for a lot of people making extra 9:59:59.000,9:59:59.000 contributions in super, the benefits of [br]compounding interest come along anyway, 9:59:59.000,9:59:59.000 because you can't get access to it. [br]But what it does say, is if you want to 9:59:59.000,9:59:59.000 start growing your super, the earlier you[br]start, generally speaking, the less amount 9:59:59.000,9:59:59.000 you've gotta make as a contribution[br]a fortnight. 9:59:59.000,9:59:59.000 And what is the value of superannuation[br]to you? Well the value of super is this; 9:59:59.000,9:59:59.000 It's a very tax-advantaged saving scheme [br]for retirement, often more, better tax 9:59:59.000,9:59:59.000 advantages than you're gonna get through[br]your income tax rates. 9:59:59.000,9:59:59.000 Why is superannuation compulsory, and it's[br]been compulsory since 1992, it's so that 9:59:59.000,9:59:59.000 you have an alternative to, or a [br]supplement for, the age pension. 9:59:59.000,9:59:59.000 The age pension, is not going to disappear[br]anytime soon, but it is still seen as 9:59:59.000,9:59:59.000 being only a safety net for retirement.[br]Because we've been getting compulsory 9:59:59.000,9:59:59.000 super now since 1992. 9:59:59.000,9:59:59.000 And the value of super for you might be [br]to give you the options in retirement 9:59:59.000,9:59:59.000 that you might not otherwise have, by just[br]relying on the age pension, or even just 9:59:59.000,9:59:59.000 compulsory super, maybe making extra [br]contributions, will meet your objectives, 9:59:59.000,9:59:59.000 as to what your lives might look like[br]in retirement. 9:59:59.000,9:59:59.000 Now there are different ways of getting[br]money into super, and the main way is 9:59:59.000,9:59:59.000 your employers' contributions. [br]Now down on the left-hand side you can 9:59:59.000,9:59:59.000 see, you can put super through your[br]employers' contributions, through salary 9:59:59.000,9:59:59.000 sacrifice through your payroll, voluntary [br]after-tax contributions, through cheque 9:59:59.000,9:59:59.000 or B-pay or even through your payroll. [br]There are also personal deductible 9:59:59.000,9:59:59.000 contributions which we're not going to[br]go into great detail about today, 9:59:59.000,9:59:59.000 and there's also spouse contributions. [br]But across the top, there are two main 9:59:59.000,9:59:59.000 forms of contributions. One is called [br]concessional contributions, one is called 9:59:59.000,9:59:59.000 non-concessional. 9:59:59.000,9:59:59.000 What is the difference? The difference [br]comes down to the name. Concessional 9:59:59.000,9:59:59.000 contributions are moneys' that go into [br]your super before you pay your income tax. 9:59:59.000,9:59:59.000 Now when I showed you before that for [br]most Australians earning over $30,000 a 9:59:59.000,9:59:59.000 year, most of us are paying 30% tax on a[br]fair chunk of our income. 9:59:59.000,9:59:59.000 So for when you have a non-concessional[br]contribution, that means you've earned 9:59:59.000,9:59:59.000 your money, you've generally paid your [br]tax on your income, which could be 30%. 9:59:59.000,9:59:59.000 So if you earn $1000, you might lose 30%[br]being 300, you can get $700 into your 9:59:59.000,9:59:59.000 super, that would be a non-concessional[br]contribution. But when putting money 9:59:59.000,9:59:59.000 into your super as a concessional [br]contribution, the money comes out of your 9:59:59.000,9:59:59.000 income, before it gets taxed at your [br]regular tax rate and instead goes into 9:59:59.000,9:59:59.000 your super and will only be taxed at 15%. [br]So you earn $1000, only to lose 15%, 9:59:59.000,9:59:59.000 you're left with $850. So superannuation[br]concessional contributions is like earning 9:59:59.000,9:59:59.000 $1000 and being able to invest $850, [br]whereas non-concessional contributions, 9:59:59.000,9:59:59.000 which you can invest in anywhere, might [br]otherwise be earning $1000 and only 9:59:59.000,9:59:59.000 getting $700 invested. That's the benefit [br]of superannuation. 9:59:59.000,9:59:59.000 And what this slide here is showing, [br]excuse me, is normally you earn your 9:59:59.000,9:59:59.000 salary, your salary gets taxed at your [br]marginal tax rate, think 30-odd percent or 9:59:59.000,9:59:59.000 possibly more, at the top end, and money[br]goes into your bank account. 9:59:59.000,9:59:59.000 Money that you can buy and invest [br]elsewhere, the interest or earnings are 9:59:59.000,9:59:59.000 also taxed at your marginal tax rate. [br]But when you put money into superannuation 9:59:59.000,9:59:59.000 through your salary, through salary [br]sacrifice, it'll only be taxed at 15%, 9:59:59.000,9:59:59.000 either on the way into your account with [br]most super funds like GESB, Australian 9:59:59.000,9:59:59.000 Super and Hesta, or the money on the way[br]out, with West State Super, still 15%. 9:59:59.000,9:59:59.000 And not just that, not only do you pay [br]only 15% tax on the contributions, you 9:59:59.000,9:59:59.000 only pay 15% tax on the investment [br]earnings, as opposed to your marginal tax 9:59:59.000,9:59:59.000 rate. Now because superannuation [br]is considered to be tax-effective savings 9:59:59.000,9:59:59.000 strategy for your retirement, that's why[br]the government's put in place, they also 9:59:59.000,9:59:59.000 understand, that by saving for your [br]retirement, the government is going to 9:59:59.000,9:59:59.000 receive less tax now, than if you hadn't[br]put it through your pay. 9:59:59.000,9:59:59.000 That's why they limit the amount you're[br]allowed to put into your superannuation 9:59:59.000,9:59:59.000 through what are called concessional [br]contributions. Now for most Australian 9:59:59.000,9:59:59.000 funds, being taxed funds, GESB, Australian[br]Super, that sort of fund, the limitation 9:59:59.000,9:59:59.000 per year is $30,000 per year. [br]And that includes your employers super 9:59:59.000,9:59:59.000 contributions, so you can already get in[br]11 and a half percent in super, you're 9:59:59.000,9:59:59.000 allowed to go above and beyond that up to[br]$30,000, per year for your superannuation 9:59:59.000,9:59:59.000 savings. If you go above that, you're not [br]penalised as such, but the excess 9:59:59.000,9:59:59.000 contribution will be taxed at your [br]marginal tax rate. 9:59:59.000,9:59:59.000 Now, for those of you who might have a[br]West State Super, or indeed a Gold State 9:59:59.000,9:59:59.000 Super Account those concessional [br]contributions of an annual $30,000 limit, 9:59:59.000,9:59:59.000 do not apply to you. Instead, you've got [br]what's called an untaxed plan cap, 9:59:59.000,9:59:59.000 and as that currently stands, that is [br]$1.78 million in your lifetime. 9:59:59.000,9:59:59.000 That gets indexed every year. [br]So that means, if you've got West Side 9:59:59.000,9:59:59.000 Super for example, you're respective of [br]what your employer's putting into your 9:59:59.000,9:59:59.000 employers' contributions