superannuation vs 401k

One incredible benefit of working in Australia is superannuation. Super is money set aside by your employer to provide for your retirement. It’s like a 401k, but much better.

minimum of 9% of your salary is paid into a special retirement fund (think mutual fund) in addition to your salary. The program also allows you to built your super with your own contributions, which take advantage of super’s favourable tax treatment. Like a 401k, you choose the fund that the super money is paid into.

If like me, you are a temporary employee in Australia, you can claim the superfunds when you leave the country (minus some taxes). This benefit is HUGE. Sadly, I’ve read that many migrant works don’t know it can be claimed, so the funds are returned to the Australia Tax Office (ATO).

This allows anyone working in Australia to save 0% of their net wages and still have at least 9% of their total lifetime income waiting for them at retirement. Incredible.