If you’re nearing retirement and your children have moved out, downsizing your home can be a smart way to increase your retirement savings.
The Downsizer Contribution is a way to put money from the sale of your home into your superannuation. An individual can contribute up to $300,000, or, if you’re part of a couple, you both can contribute up to $600,000, even if only one of you owned the home. This contribution is allowed on top of the regular super contribution rules. In some circumstances the Downsizer contribution can be used for the sale of an investment property where it has previously been a principal place of residence.
The Contribution can be used by anyone aged 55 or older with no maximum age limit and it can be used regardless of your existing superannuation balance (no $1.9 million cap). You or your spouse must have owned the home for at least 10 years and the sale must be at least partly exempt from capital gains tax. Any contribution must be made within 90 days of receiving the sale proceeds, the contribution can only be made once and it cannot be more than the total sale price of your home.
There is a specific downsizer contribution form which must be submitted to your super fund no later than the time the contribution is made.
The downsizer contribution is a great way to boost your superannuation savings and secure a more comfortable retirement. Ask your superannuation fund or financial advisor for more information.
| Christian Golding and Pitcher Partners Wealth (WA)Pty Ltd are Authorised Representatives of Sentry Advice Pty Ltd, (ABN 77 103 642 888) AFSL 227748. |
This information is of a general nature and you should not act without considering your personal needs or circumstances. We recommend you obtain professional financial advice.
