– Hi everyone. It’s Clyde from Yellow Brick Road here at St. Mary’s, your local wealth accelerator specialist. Today, I’m gonna go through with you three things that you need to be aware of if you have insurance inside Super. The first thing that
you need to be aware of is your premiums eat into
your account balance. And yes, I know it is
obvious but trust me, a lot of people forget that, especially if they’ve reduced their working hours, if they’ve stopped working, if they’ve changed jobs and their income is less than what they were making before. They forget that the insurance premiums inside Super are eating into their account balance and that will affect
your retirement balance down the track because
over time your premiums can be worth thousands and thousands and thousands of dollars. So what I suggest is contributing more into Super to cover that premium amount because then at least you know that your account balance can grow and it’s not being eaten by the insurance premiums. So that’s the first thing to be aware of is it does eat into your account balance. The second thing that
you need to be aware of is the amount that you have inside Super may be insufficient to meet your needs. You see a lot of the times when I sit with clients they have default insurance cover so what that means is that they’ve opened up an account with their Super funds
and they’ve automatically been given some insurance cover. 99.99% of the time it
doesn’t meet their needs. You see because they have a mortgage, they have major debts, they have kids that are financially dependent on them and most of the time all those debts and all that, you know the amount that they need to continue with their lifestyle is going to be greater than the amount, the default insurance
amount that they have. So that’s something to be mindful of is that it can be insufficient to meet your financial needs, so I strongly suggest you sit with someone and review that especially if you have major debts. And the third thing that you need to be aware of is the tax implications if it’s paid to a non financial dependant. So if you have for example an adult child and you’re relying on the insurance to be paid to them, now the amount that you
think that they will get may not be the amount
that they actually get because there are tax implications that you need to be aware of if it goes to a non financial dependant. So they’re the three
things that I like you to remember when it comes to insurance inside Super. The first thing is it eats into your account balance, the second thing is that the amount may be insufficient to
meet your financial needs and thirdly consider the tax implications, especially if it’s paid to a non financial dependant. So that’s it for this week. If you’d like more information or if you’d like me to sit down with you and go through your insurances, put a comment below
and I’m more than happy to get in contact with you. The other thing is I do have a checklist that I can email that through to you, just put in checklist below and I’ll send that through. It’ll go into more detail in what I’ve just spoken to you about. And thirdly if you know
anyone that will benefit from this video please
share it and tag them so that they can actually
hear what I’m saying. And finally, remember I’m dedicated to helping you take actionable steps today for a better financial tomorrow. See you all next week. Bye bye.