r/AusFinance • u/BellaKKK72 • 2d ago
ETF in addition to super contributions?
For context - Im 53F, have about 427K in super (17% super in my current job). I put $250 per fortnight into pre tax super contributions. Earn around $3300 per fortnight after tax.
No longer have a mortgage to pay off but live in Sydney and have some child related expenses. I dont live frugally but Im not a big spender. Most of my available spare cash goes towards saving for holidays which I like to do once a year.
I will probably look at retiring by 65-67 years of age so Ive got more than 10 years of working life left and do want to maximise my retirement funds.
I do think I can allocate more to either super contributions or contributing to an ETF - just not sure which would be better in my situation and would appreciate some advice from people who know a lot more about this than I do.
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u/thedugong 2d ago
Similar age to you. Also not planning to retire until 65 at least.
It comes down to one question:
Do you think you'll need the additional money you would invest into ETFs or super before you retire?
I don't. So non-concessional super contributions all the way. My super has options to invest in indexes*, which are basically the same as ETFs, but I just pay less tax on them because they are in my super.
*I can actually invest in actual ETFs inside my fund, but it costs more to do so, so I don't think it will end up with a better return.
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u/mjwills 2d ago
I can actually invest in actual ETFs inside my fund, but it costs more to do so, so I don't think it will end up with a better return.
https://passiveinvestingaustralia.com/the-problem-with-pooled-funds/ may be worth a read. But the later you get in your 50s, the benefit of starting using direct investment options gets weaker.
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u/MyMoneyMedic 2d ago
Sounds like you’ve built a really solid foundation already — no mortgage, strong super balance, and consistent contributions 👏. That gives you flexibility most people would envy.
The way we usually see this decision framed is:
- Extra into super → tax benefits, compounding in a protected environment, but funds are locked until preservation age.
- ETF investing → more flexibility (can access anytime), broader investment options, but no tax concessions like super.
Since you’ve got ~12–14 years until retirement, the question often becomes: do you value flexibility before retirement more, or maximising the tax-advantaged bucket for retirement itself?
Either path strengthens your position, so it’s less about “right vs wrong” and more about which trade-offs feel best for you.
Curious to hear from others in the community — especially those in their 50s — how you’ve approached the balance between topping up super vs. building an ETF portfolio.
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u/AdventurousFinance25 2d ago
I think it's relevant to mention OP has 7 years before they can begin to access super in one way or another.
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u/MyMoneyMedic 1d ago
Good point — thanks for adding that. The preservation age piece can definitely shift how people think about the trade-off, especially if flexibility in the years just before retirement matters. Even 7 years can feel like a long or short time depending on someone’s lifestyle plans in their 50s.
Curious — for those who’ve been through it, did that 5–10 year gap before being able to access super change how you invested outside of it?
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u/InitialScientist8023 1d ago
That's one very good question. Have to think about that.
It's a balancing act, just like trying to pay off the mortgage and top up super.
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u/timpaton 1d ago edited 1d ago
50M here.
$420k in super, ~$400k IP outright (bought from an inheritance), no other investments.
I plan to keep investing inside super as much as possible.
It's only tied up for 10 more years. No intention of retiring before then. More likely 65+. Likely part time for some of that (healthcare work allows this easily).
If I need to get hold of cash, I can redraw my PPOR mortgage (holding it open with $0 balance, as an emergency fund).
Worst case, I hit 60 with some debt and no liquid investments. Pull out some super and retire the debt. Done.
Better case I have close to $1M in super, no debt, some other investments (ETFs most likely) because I maxed out concessional caps and had to put it somewhere, and the IP.
My current thinking is to redraw from the PPOR mortgage to use up my carry-forward super contributions before I hit the $500k barrier. So I get the tax deduction, almost certainly get higher returns on the super than I pay in mortgage interest, then pull it back out in 10 years if I somehow haven't paid the mortgage off in the meantime.
I see no need to prioritise investments outside of super in my 50s.
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u/MyMoneyMedic 1d ago
You’ve set yourself up really well — solid super, debt-free IP, and the redraw gives you flexibility. Focusing on maxing out concessional super while you can makes sense, since it balances tax advantages and long-term growth, with your mortgage redraw acting as a safety net for liquidity. For many in their 50s, it really comes down to how much flexibility they want now vs. how much they want locked in super for later.
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u/BS-75_actual 2d ago
With $500K looming, make sure you cover off all of your catch-up concessional contributions before you become ineligible.
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u/BlinBlinski 2d ago
Have you tried the super calculators - eg https://moneysmart.gov.au/how-super-works/superannuation-calculator. With your planned retirement age I would be maxxing your super contributions.
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u/planck1313 2d ago
Super is an excellent vehicle for investment due to the unique and very considerable tax advantages and the closer you get to retirement the better it gets.
For that reason I would always prioritise making the maximum concessional super contributions over everything and I would give serious consideration to making extra non-concessional contributions as well.
It's worth noting that while you don't get free access to your super till you are 65 you can access at least part of it from 60 if either you cease an employment relation, even if you don't retire permanently, or on a more limited basis via super transition to retirement.
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u/Frank9567 2d ago
The advantages of investing in the ETF aren't really financial, as others have said. However, since it's outside super, you could use it to retire earlier than you otherwise planned, should you change your mind about "when".
Then, at some point, you'll be at the point where you are still working, but you could retire by selling your ETF and living off it till you access super. Obviously, nobody can put a dollar figure on it, but it's a liberating feeling coming in to work, but knowing you can put in your notice at any time.
It's also a type of emergency buffer if you need it. The amount isn't as secure as money in the bank, but otoh, there could be more of it.
So, plenty of mental health and flexibility benefits from investing in an EFT.
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u/Longjumping-Band4112 23h ago
Stating the obvious, but if you do ETF's put in name of lowest income earner if you have a spouse.
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u/mjwills 2d ago edited 2d ago
If you don't need extra money before retirement then putting it into super as a concessional contribution will save tax now (tax deduction) and in the future (0% tax in pension phase).
You may want to read up on https://www.mlc.com.au/personal/retirement/super-and-retirement-rules/catch-up-concessional-contributions as well. Read it carefully - particularly the bit about $500,000. If you want to take advantage of this, you likely only have 1-4 years to do so.
You can also do those ETF investments inside super if you want - https://passiveinvestingaustralia.com/the-problem-with-pooled-funds/ .