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Why Doctors and Dentists Can’t Ignore Super

Despite what you may think, superannuation will still form the cornerstone of your retirement.

That is, if you give the attention it deserves.

There have been various media reports recently (including this Four Corners report), highlighting the flaws and issues of the current system.

In addition to those, I wanted highlight a few critical issues relating to doctors and dentists in particular:

1) Duplication of costs

Too many doctors and dentists have multiple superannuation accounts, which leads to a duplication of fees and insurance premiums. We have been able to secure annual savings in excess of $10,000 for some clients. Imagine the extra super benefits this would generate over 20-30 years.

Please note though, you should always seek advice before closing any accounts, as you may lose valuable benefits.

2) Lack of contributions

Too many doctors and dentists do not actively contribute to superannuation, particularly those working as contractors. With the current contribution limits being as low as they are, you cannot afford to wait until you are 50 to start contributing to super.

Many of our younger medical clients understand the power of compounding investment returns in a low-tax environment, and make a conscious effort to target their maximum tax-deductible contribution.

3) SMSFs are not always right for you

Just because your colleagues have one, or your accountant or adviser thinks you should have one, doesn’t mean you actually should.

A whole advice industry has been built around getting people into SMSFs. My view on it is that they are widely over-used and many (if not all) of the benefits of an SMSF can be replicated in another, more cost-effective and simpler way.

Make sure you work out what is right for you.

If you have any questions in relation to this article or other financial issues, please contact me via Yves@affluenceprivate.com.au


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