Immediately increase contributions cap, says FPA
The Financial Planning Association (FPA) has urged the Government to immediately increase the $25,000 cap on superannuation contributions to $50,000 for all Australians over 50, regardless of their balance.
In its submission regarding the Federal Budget, the FPA said Government needed to consider a longer-term outlook that went beyond the current election campaign.
The FPA said the Government must undertake three specific policy initiatives to improve access to financial advice for all Australians.
It said, in terms of increasing the cap, the Government should consider a flexible and more pragmatic way of dealing with excess concessional contributions.
It also suggested the need for an initial financial plan, and ongoing management fees or annual retainer fees that were tax deductible.
The FPA said its recommendations addressed issues Australia had with developing a savings culture and improving Australians' retirement readiness to reduce reliance on the social security system.
Its recommendations also spoke to the need to improve access to financial advice for those Australians most in need of assistance, and also to remove inconsistencies in the tax system.
The FPA submission expressed concern at potential changes to the system in this years' budget.
"The FPA, its members and the millions of Australians that they service, strongly request that the Government does not introduce any changes that will reduce the incentives and benefits of the superannuation system which encourage people to save for their retirement.
"With an ageing population and the additional pressure this will add to future budgets, the FPA strongly recommends that the budget reflect policy decisions that are designed to support and encourage today's working Australians to become self-funded in their retirement," Dante DeGori, general manager policy and standards said.
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