![\"\"](\"https:\/\/acctweb.com.au\/images\/fp-death-and-taxes.jpg\")
<\/p>\nLack of proper financial advice is costing hundreds of thousands of retirees in unnecessary taxes, the Super Members Council has said.<\/p>\n
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The Super Members Council found that around 700,000 Australians over 65 who aren\u2019t working full-time still have an accumulation account and could be paying an extra $650 in taxes each year on average. Altogether, they have $90 billion in accumulation accounts.<\/p>\n
The council said this is because they didn't receive basic advice to switch their super into the tax-free retirement phase.<\/p>\n
According to the SMC, if someone keeps $100,000 in an accumulation account instead of moving it to a pension account, they could pay an extra $4,500 in super taxes over their retirement. For $200,000 balances, the extra tax could be $9,000.<\/p>\n
It added that some inactive accounts belong to people who are still working and adding to other accounts or keeping an accumulation account as a backup. However, research shows many people don\u2019t act because they are disengaged or don\u2019t know what to do.<\/p>\n
A consumer survey of retirees found about six in 10 Australians with a lower balance (less than $100,000) who have an inactive account keep it because they haven\u2019t decided what to do with super yet or don\u2019t know what to do with their account.<\/p>\n
SMC CEO Misha Schubert said Delivering Better Financial Outcomes financial advice reforms would be crucial to help retirees access quality information at low cost.<\/p>\n
\u201cNot knowing enough about super can lead to poor decisions, like leaving accounts inactive or withdrawing funds without proper planning,\u201d Schubert said.<\/p>\n
\u201cMaking simple information and advice available to more Australians is a big missing piece of the retirement puzzle. The coming financial advice reforms will help make advice more affordable.\u201d<\/p>\n
Schubert said the government needs to introduce the legislation quickly to enable the 2.5 million Australians on the runway to retirement to get the high-quality information they need to plan wisely at a much lower cost.<\/p>\n
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Keeli Cambourne
\nFebruary 03 2025
\nsmsfadviser.com<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
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