When should I realistically start planning for retirement?

When should you start seriously planning for retirement? No matter how old you are, you’ve likely thought about this question and whether – or when – you expect to stop working full time. Research shows most people in Australia are at the very least expecting to retire. It appears many may have a hard time making this a reality, though, given that only a slight majority are putting money aside to use in their golden years.

According to a study conducted jointly by the American Academy of Actuaries, Institute and Faculty of Actuaries and the Actuaries Institute Australia, roughly 72% of people in Australia anticipate retiring at some point. However, just 55% of these same respondents claim to have gone about the process of saving money. This may explain why only around 23% of Australians say they expect to retire fully, meaning not work in any capacity.

All this raises a very important question: When is the best time to starting actively planning for retirement?

The earlier, the better

According to many financial advisors and planners, there is no such thing as preparing too early. For instance, according to financial planning guru and Forbes contributor Eric Brotman, an ideal time in life to begin is when you’re in your 20s.

“Starting your retirement preparation when you’re as young as 25 means you have time on your side to start building good habits and compounding savings,” Brotman wrote.

Although the costs of living can make saving as much as you’d like difficult it times, every little bit counts. The process itself, however, is quite simple: Spend more than you make. As a general rule, try to live on roughly 85% of what you earn, Brotman advised. The remaining 15% should be put away in some form of interest-earning account or safe investment vehicle.

How much do I need to retire comfortably?

Another question people often have is how much it will actually cost them to retire, as there is always a risk you may outlive your savings. Because various expenses can change from year to year, the unstable nature of price can make arriving at a definitive figure difficult. However, according to the most recent data available from the Association of Superannuation Funds of Australia, most people can live a modest lifestyle on approximately $24,250 per year. For a more comfortable living, however, it’s almost double that at $43,665.

If you have questions regarding retirement, life insurance or superannuation, Gerard Malouf & Partners may be able to help. Contact us today.

Can you appeal a super fund claim to access your super if that is denied?

Your super money is meant to cover your retirement expenses, however, there are limited circumstances where the government will release these funds early. The Australian Taxation office explains that while your superannuation fund is easily accessed once you retire or turn 65, you may need to acquire this money sooner if you experience a financial hardship or become disabled.

In these circumstances, you will need to file a claim to access your super early and receive a payout. Your super fund will then either accept or reject the claim. Of course, no one wants their request to be denied, but it does happen. If you had a super fund claim denied, here is all the information you should know moving forward.

Common reasons for rejection

There are just a few specific circumstances in which you can access your super early, and all of them have strict eligibility requirements. For instance, if you need super money due to financial hardship, you must have already received government income support payments for 26 weeks and not be able to meet reasonable family living expenses, according to the Australian Taxation Office.

Furthermore, supers will require evidence of said financial hardships and bills outlining living expenses. The criteria for other circumstances are just as strict, so it’s important to first see if you’re able to file a claim and then start collecting evidence to send your super.

Because of these staunch rules, one of the most common reasons super fund claims are denied is because the person does not meet their eligibility requirements – or they did not send in enough paperwork to prove that they do.

How to appeal a denied claim

Luckily, if a super fund claim is denied the first time, you can appeal it. Appealing a super fund claim can begin by asking your super to reevaluate your claim and provide any additional information that may help your case.

The Australian Financial Complaints Authority (AFCA) is the organisation that handles complaints made due to a denied super fund claim. If you believe your super fund claim was denied unfairly, or if you would have previously taken the compliant to the Financial Ombudsman Service, the Credit and Investments Ombudsman and the Superannuation Complaints Tribunal, the AFCA with handle it.

If you have been injured and need to access your super or have more questions about the requirement and time limits to appeal a super fund claim, contact the professionals at Gerard Malouf & Partners today.

Second wave of super early releases involves millions more applications

The COVID-19 pandemic has brought changes to Australian’s lives, encompassing a wide range of professional and personal issues. One of these effects has been the ability to withdraw money from superannuation funds early, an opportunity that many Australians have taken. These withdrawals have led to several questions about the future of those individuals’ funds and the effect on supers as a whole.

Second wave of withdrawals begins with 500,000 applications

Money Management reported that in the week between June 29 and July 5, 132,000 members of super funds asked for the early release of some of their money. Since the second period of eligibility began, many people have requested an additional payment. According to the news provider, data from the Australian Prudential Regulation Authority shows there have now been 2.54 million payments throughout the course of the early release scheme. That reflects some people withdrawing twice and others applying to receive money from more than one super fund.

The number of applications for money in the June 29 to July 5 period totaled 511,000, 346,000 of which were repeat applicants. That period represented the first week of the new fiscal year, making it the state of eligibility for repeat withdrawals. Money Management reported that since the scheme began, the average amount withdrawn is $7,511 per application.

Potential for long-term issues due to withdrawals

According to Pursuit, there could be delayed issues for those who withdraw money from their super funds now. While the government’s stated intention for the plan is to enable Australians to have spending money during the difficult days of pandemic shutdowns, Pursuit cited research that found 40% of people withdrawing did not experience a drop in income during the crisis. With a lack of consistent income checks, members have found themselves able to take money with few questions asked.

Furthermore, the purchases made with early super funds are not always the items the government may want people to spend on. Pursuit noted that while more than half of the money – 64% – went to discretionary purchases and debt repayment, potentially stimulating the economy, 11% of additional spending from the releases has gone to gambling. Super withdrawals may also widen the gender pay gap. Occupations that skew female have been hard-hit by layoffs, and free child care will soon end ahead of its initial schedule, which are motives for women to withdraw – but this could leave them with less funds when it’s retirement time.

At Gerard Malouf & Partners, we are superannuation experts – if you’re considering disputing the payout of a loved one’s superannuation insurance, call 1800 004 878 or reach out to make an enquiry.

Will supers survive the COVID-19 crisis without major losses?

In a case of turning against the difficult financial head-winds created by the global COVID-19 pandemic, there are increasing signs that superannuation funds could end up without major losses. The New Daily noted that supers have diversified their investments so greatly that even a stock market crash on the level witnessed in recent months has not been able to devalue these funds.

Why haven’t losses been greater?

The New Daily reported that according to Chant West research, it is possible that supers will end up with positive returns for the year. This is obviously in contrast to the damage that has been dealt to major exchanges – markets were down 37% from normal levels during March, when the financial chaos associated with the pandemic was at its height.

The fact that superannuation funds have diversified their portfolios appears to have saved them from suffering the fate of stocks. The New Daily contrasted the most recent economic collapse with the one that followed the 2008 crash. In that case, the stock market fell 44% and super funds dropped 26%. This year, by contrast, the super funds took a hit only 31% the size of the damage to the stock market.

Due to the aforementioned move to more diversity in their investments, superannuation funds now find themselves with a chance for a net-zero performance or, remarkably, positive numbers.

What changes will come to the system?

Those numbers have come out at a time when more Australians are aware of their super funds’ existence and size than ever before. As The Sydney Morning Herald recently explained in an editorial, the decision to allow early withdrawals has made young people see their supers as something tangible and real, rather than a far-off and abstract financial concept. The question now becomes whether this greater attention will have an effect on changes to supers.

The Herald editorial board pointed out that proposed changes, such as an increase to 12% annual contribution or the new ability to withdraw money for home down payments have to be considered carefully. A lack of transparency has led to issues such as a bank quickly and quietly taking away home loan redraw ability as the pandemic broke out.

In one of the most active periods for superannuation funds in years, in the grip of a pandemic-related financial crisis, you need expert assistance to resolve any disputes over the disbursement of money in the case of a fund holder’s death or disability. This is where the superannuation dispute experts at Gerard Malouf & Partners can help you.

How to choose the best super fund

One of the keys to finding success with your superannuation investments comes at the very beginning: You have to choose the right one to ensure long-term financial security. However, there are many considerations that go into finding the best option available to you, so how do you pick?

Read on to find out the factors that make up a great super for you, which you need to consider in your research:

Strong average returns

First and foremost, you need to be assured that the money you put into a super will do as much work for you as possible. As such, looking at a number of funds’ performance over the past few years will help you determine which ones are giving enrollees the strongest return on their investment.

However, it’s important to make sure you compare and contrast relatively similar supers so that you get a good idea of what to expect no matter which type of fund you choose.

Low costs

Of course, there are always costs associated with staying enrolled in a chosen super. Some relatively no-frills options have relatively few fees applied, while others may have costs that are quite a bit larger.

For high-performing supers with more options, you may be charged more, but also get a greater return. As such, it’s important to strike a balance between costs and returns.

The insurance details

In many cases, you may be able to get life insurance or disability coverage through your super – and that’s an option most Australians take. However, just like the other details, you will need to look at various funds and find the coverage that makes the most sense for your needs.

Don’t just set it and forget it

Once you’ve determined which super (or supers) to invest in, you should evaluate their performance on a regular basis. Those that have performed well in the past two years might not be doing quite as well two years from now, and being willing to shift investment strategies is a big part of finding long-term financial success.

If you ever run into difficulties with your super fund and have to dispute it for some reason, it’s important to have the experts on your side. At Gerard Malouf & Partners, we have years of experience dealing with superannuation disputes and can help you get the results you need. Plus, with our offer of a free consultation, 90-day complimentary trial and No Win No Fee programme, there’s no risk to you. Get in touch today to learn more.

What is a total permanent disability claim?

If you become permanently disabled due to an illness or injury, total permanent disability insurance can be an important financial safety net. According to the Australian Securities and Investment Commission, this coverage will pay you a lump sum if you’re permanently unable to return to work due to an ailment or accident. This is true of most policies however some insurance policies, pay this benefit as a ‘disability pension’ or monthly benefit.

When it’s time to make a claim on this insurance, ensure you know the steps to follow.

Are you eligible for a claim?

It’s important to note that every insurer has a different definition of what constitutes being totally and permanently disabled. Review your individual policy before filing a claim to understand your eligibility.

Your insurance provider will require detailed information on your disability, including how it occurred, its severity and the likelihood that you may recover. You will typically need to fill out a lot of documentation and include your medical records as evidence. Additionally, you may have to provide information on your work history, daily tasks and projected medical costs with your claim.

Filing a claim within your superannuation fund

According to Finder, some superannuation funds offer a basic level of total permanent disability coverage for members. If you have this default coverage (ask your representative to find out), you must follow these steps to make a claim:

  1. Organise your documents – including ID, medical records and evidence supporting your claim.
  2. Contact your super fund to submit your claim – you will need to ensure you sign your claim statement and provide it with your other documents.
  3. A case manager will assess the claim to determine your eligibility – they will work in your best interest and may ask for additional information or records that would help support your claim.
  4. Your insurer will assess the claim and documentation – they may request further information.

Ultimately, your insurer will either accept or reject your claim based on the evidence you and the case manager provided. They may also defer the claim if they believe more documentation is needed about your disability.

Have questions about your total permanent disability claim with your superannuation? The legal experts at Gerard Malouf & Partners. Contact us today for help understanding your rights and ability to file a claim.

What is an income protection claim?

It’s important to be financially prepared for all the different scenarios life can bring, including if you become injured or ill and unable to work. Income protection insurance can be an important safeguard to ensure you can continue your standard of living if you can’t work due to an unforeseen accident or illness.

What’s income protection insurance?

According to Choice, income protection insurance pays part of your income – typically 75% of it – if you’re unable to work. Most insurers have specific requirements for what constitutes an illness or injury that must be met or confirmed by a doctor before a claim is made.

It’s always important to understand your individual insurer’s terms and conditions before signing a contract or filing a claim. After filing a claim, there may be a waiting period before your payments start, which can be as little as two weeks or as long as two years. Additionally, you’ll need to carefully choose how long the monthly payments will last, known as the benefits period.

All of this information will help you choose the best income insurance policy for your needs, so in the event you become injured or sick, you can cover expenses and bills while you’re out of work and focus on getting better.

Who needs income protection insurance?

This coverage is ideal if you are more interested in keeping up with your lifestyle and providing for your family for a period of time while you’re out of work as opposed to granting a lump-sum payment like life insurance would.

You may want to consider income protection insurance if you’re self-employed, a small-business owner or have dependents that rely on your income to survive. Additionally, if you don’t have a lot of sick leave or have multiple monthly payments, this insurance can help serve as a financial cushion if you can’t work.

Filing a claim

When it comes time to file an income protection claim, the Australian Securities and Investments Commission explained you will need to notify your insurer, your superannuation fund and your employer to receive the necessary paperwork. Your insurer will typically require your medical reports outlining the nature and severity of your accident or illness along with a description of your work duties.

If you have questions or concerns about filing an income protection claim, contact the legal experts at Gerard Malouf & Partners.

Can I access my super if I am permanently disabled and unable to work?

If you have had an illness or injury that led you to become permanently disabled and thus unable to work, you may be understandably worried about your finances. Some people in this situation may seek to tap their superannuation early, and the good news is there are laws on the books that make this possible.

Australians may be granted early access to their supers on what are known as “compassionate grounds” as long as they have unpaid expenses and no other means of paying for them, according to the Australian Taxation Office. However, this is not an unlimited withdrawal opportunity – you will only be able to access what is reasonably required to pay specific expenses.

What does that mean?

There are specific types of expenses you can tap your super to cover in the event of a permanent disability, the ATO noted. These include:

  • Medical treatments or transport for you or one of your dependents
  • Expenses necessary to keep up with home payments so you do not become homeless
  • Installing modifications to your home to cater to your disability
  • Palliative care for you or a dependent
  • Expenses associated with final costs for a deceased dependent.

These funds would be paid out in a lump sum, and taxed as such.

What’s considered ‘early?’

Of course, you may also be eligible to tap your super in other circumstances, according to the Australian Securities and Investments Commission. If you retire before the age of 65 – for whatever reason – you may have a “preservation age” of as little as 55, depending on when you were born, and that may apply even if you have not fully retired. For everyone born after 1 July 1964, that is 60 years of age or older.

However, if you were working beyond the age of 65, you can begin withdrawing from your super whenever you like.

There are many particulars that may or may not apply to your unique situation, and it can be difficult for people dealing with many other concerns to determine whether they would be eligible for early withdrawals on their own. If you have questions about the specific circumstances you may begin withdrawing from your superannuation funds early, it’s a good idea to get in touch with the legal experts at Gerard Malouf & Partners. We will help you work through any issues you may be facing to find a suitable resolution that meets your needs.

Fishing boat skipper receives judgment in car accident case

A former charter boat skipper who was injured in a September 2014 accident involving a motor vehicle was recently awarded nearly $634,000 in damages after the incident left him unable to work on boats.

The Supreme Court of Queensland recently ruled that Alan Zavodny, now 65 years old, would likely be prevented from engaging in any work on a boat or ship as a direct result of the ankle injury he received, according to the Courier Mail. The accident occurred while Zavodny was riding his electric bike at a reasonable speed and taking all due precautions, but had to swerve to avoid a vehicle that quickly went from parked to backing up.

A closer look

Zavodny testified in the suit that the injuries – which included a deep wound and a fracture initially, followed by a series of infections, as well as a shoulder injury – actively prevented him from pursuing work in his chosen field. He specifically noted that the ankle and foot injuries led to loss of sensation in the bottom of his left foot so that he does not when it actually hits the ground at any given point, and that he can only stand on a ship with reduced stability.

In making his decision, Justice James Henry found that Kevin Couper, driver of the vehicle, had been negligent in his actions leading to the accident.

What happened?

On 10 September, 2014, Zavodny was heading down a wide two-way street in South Townsville, Queensland, when Couper suddenly began backing out of a nose-in parking bay, according to court documents. Zavodny, who was nearing his destination, had begun to slow his bicycle when Couper reversed, causing Zavodny to swerve hard to his right and jack-knife the bike, causing him to fall off and land on the bitumen paving.

Justice Henry found that, pursuant to the Civil Liability Act of 2003, Zavodny had behaved as a “reasonable person in his position” would have, and that he had been “keeping a proper lookout” in addition to traveling at an otherwise safe speed. Altogether, the nearly $634,000 judgment takes into account damages, financial losses due to an inability to work (including loss of superannuation), interest, loss of future earnings and son.

If you have been involved in an auto accident and think negligence may have played a role, reach out to the experts at Gerard Malouf and Partners. Contact us as soon as possible for more information.

Know Your Rights: Duties of Insurers and Trustees During the Assessment of a TPD Claim

A Superfund member who is seeking to lodge a Total and Permanent Disablement Claim is entitled to have their claim assessed in accordance with various legal principles. The Superannuation Industry (Supervision) Act 1993 and Insurance Contracts Act 1984 govern the various duties and obligations which an Insurer and Trustee must uphold when determining TPD claims. These duties are as follows:

  • To act independently and impartially;
  • To act honestly and in good faith in all matters with a real and genuine consideration;
  • To ensure its powers and duties are exercised in the member’s best interests;
  • To exercise discretion according to the purposes for which the Trustee was conferred;
  • To exercise the same degree of skill, diligence and care that would be expected from an ordinarily prudent person in the investigation of a member’s claim; and
  • To reach an informed view without acting irresponsibly or impulsively.

On occasion, Insurers may fail to assess a claim within a reasonable timeframe, fail to consider all of the evidence that is available or fail to apply a realistic approach to the member’s circumstances. It is the role of a TPD Lawyer to engage in strategies to ensure the appropriate progression of your claim and a successful outcome.

When deciding on a legal professional to assist you with your superannuation claim, it is important to seek the expertise of professionals who are 100% committed to dealing with your claim expeditiously, ensuring that it is assessed fairly and that your rights are safeguarded.