Starting a new job can be both exciting and stressful. With so much happening, you can be forgiven for being more focused on the new job than on sorting out your finances. However, it’s a good time to review your current savings and insurance plans so here are a few tips to keep in mind when you make your career move.
- Do you need to move your superannuation? If you’ve been in an employer fund, it’s possible you may need to select a new superannuation fund. This may be an opportunity to set up a new fund that’s more suited to your long-term needs and risk profile.
- Notify your new employer of your preferred superannuation fund. In most cases, you can choose your superannuation fund. Once instructed, your employer will be required to make all compulsory contributions to this fund.
- Review your life insurance. This is particularly important if you’re changing superannuation funds and you held life insurance with the old fund. Most life insurance companies offer a “continuation option” which allows you to replace your former cover with personal insurance cover (to the same amount) without the need for underwriting. Don’t make the move until you have new cover in place.
- Review your income protection insurance. If you are moving up in the world, make sure you increase your level of income protection insurance to reflect your higher salary. If you don’t have income protection insurance, now is the time to get it.
- Review your salary sacrifice options. For most people, superannuation is the best environment in which to accumulate funds for retirement. Ask your new employer if they will allow you to make higher contributions to superannuation from your pre-tax income.
- Start a savings plan. If your new job comes with an increased salary, you may want to contribute the additional income to your savings. Ask your employer if you can arrange for a regular deduction from each pay packet to be paid into a high-interest savings account or managed investment fund.
After all the excitement has died down, a change of job can have a significant impact on your financial plans. Talk to us about how to make the most of it.
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