The Downsizer contribution scheme allows you to use the proceeds from the sale of your home to boost your super balance by up to $300,000 for individuals and up to $600,000 in total for couples.
The maximum contribution is $300,000 for individuals or $300,000 each for couples ($600,000 in total). You should also consider how it might affect your eligibility for the Age Pension, as the extra money will count towards the assets and income test. The downsizer contribution will also count towards the transfer balance cap, which applies when you move your super into the retirement phase.
You can buy a new home that better suits your current and future needs, whether that’s accessibility (with one floor or a lift), a smaller garden or less space to clean and maintain, or a more convenient location closer to shops or family and friends.
Your electricity or gas bills may be lower as you use less energy to warm or cool a smaller house.
You could save time and money on travel by being closer to shops, friends, family and social activities.
You can quickly boost your retirement savings.
The cost of selling may outweigh the potential profit — factor in costs such as tidying up your current house, removalist, real estate agent and legal fees.
There may also be costs for purchasing a new home, such as stamp duty, building and pest inspections.
Decluttering, packing, and moving can be overwhelming. Consider your emotional and physical health before moving.
What kind of property will you be buying? Less space doesn’t necessarily mean you’ll be paying less. Do your research on both the location and the type of house you want to buy
Selling the family home can be emotional. Your home holds many memories, and you might also move away from your friends and network.
Reducing the proportion of your overall wealth invested in your home could affect your eligibility for the Government’s Age Pension or other benefits such as the Pensioner Concession Card.
You can request an appointment with a Vision Super Financial Planner to learn about eligibility and contribution caps. Bookings can also be made by calling 1300 300 820.
* ATO reference
Disclaimer
This is general information only that doesn’t take into account your objectives, financial situation or needs, so before acting on it, consider whether it is appropriate for you having regard to your own circumstances and obtain the appropriate Vision Super Product Disclosure Statement (PDS) and Target Market Determination (TMD) available from www.visionsuper.com.au before making any other decisions about Vision Super. Vision Super products are issued by Vision Super Pty Ltd ABN 50 082 924 561 AFSL 225054 RSE licence number L0000239 as the Trustee of the Local Authorities Superannuation Fund ABN 24 496 637 884.