Use your super to buy a home
28 October 2022
Using your super to save toward a deposit for your first home is a great way to speed your progress in what is becoming a difficult goal for many Australians.
“Using the first home super saver scheme you can save up to $50,000 for your deposit. That means two people could save $100,000. That’s a big step toward, if not all, the amount you could need,” says smartMonday senior smartCoach Patrick Howard.
The unique advantage of using your super is simple: you contribute from your before-tax salary to add to your super, with those contributions (up to a limit) usually taxed at 15%. At that rate you’re paying less than even the lowest payable income tax rate of 19%.
“What it means is that you can save more of your deposit through super compared with almost any other way,” says Howard.
“And while that money is in your super it could be earning investment returns. Associated earnings will be included in the total amount you can withdraw when the time comes.”