Accessing your superannuation might seem like a distant concept at age 40, but when it comes to planning for a comfortable retirement, putting a strategy in place early is key to a good outcome longer term.
The good news, whatever your situation at age 40 with regards to your superannuation balance, is that you've got plenty of time to make any necessary changes, and to reap the benefits of compound interest.
So what sort of balance do you need at the age of 40 to be on the right track?
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A comfortable retirement by the numbers
The Association of Superannuation Funds of Australia (ASFA) calculates retirement standards which indicate how much superannuation singles and couples will need in order to enjoy a comfortable retirement.
This figure currently sits at $630,000 in today's dollars for a single and $730,000 for a couple.
The single figure would generate an income of $55,923 per year, ASFA says, and would allow someone to pay for top level private health insurance, to own and maintain a reasonable car, and to enjoy regular leisure activities and some travel.
So how much do you need at age 40 to be on track to hit the $630,000 figure by age 67? ASFA's Super Detective calculator puts this figure at close to $178,000.
Other figures supplied by ASFA indicate that the average male aged 40 to 44 has $140,680 in superannuation, while the average female has $109,209.
How to make the most of your superannuation
So what to do if you're keen to maximise your superannuation balance?
The first thing to do is to make sure you only have one superannuation account.
The Australian Taxation Office's online services will be able to tell you if you have more than one fund active.
Then you can look into making extra contributions via salary sacrificing.
This is done by asking your employer to make extra contributions from your pre-tax salary.
These extra contributions are taxed at only 15% so can be an effective way of reducing tax.
And you can also make lump sum, so-called concessional contributions, which will also be taxed at 15% and can reduce your tax burden.
If you do put extra into your super and want it to be a concessional contribution, you need to also lodge a notice of intent to claim, which alerts your super fund that it is a concessional contribution and they will take the 15% tax out as necessary.
This is necessary as it is also possible to make non-concessional contributions of up to $130,000 per year.
Concessional contributions, which include your employer's contribution, are capped at $32,500 per year.
