Ask Paul: My wife's a stay-at-home mum - can I top up her super?


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Q. I am 40 and my wife is 30. I work full time with an income of $250,000. My wife is a housewife. We have a young child.

Our house is valued at $3.2 million and we have a mortgage of $1.4 million. We have a mortgage offset account with $700,000-plus. We have about $1 million invested in managed funds.

My super is about $470,000 while my wife's super is close to nil. Can I contribute super for my wife and be tax effective? Are there ways to better manage our financial situation? - Henry

stay-at-home mother sahm stay-at-home mum wife top up super contribute women superannuation child baby kids ask paul clitheroe

A. Henry, you flatter me. I reckon I should ask you how to better manage my financial situation.

I have this bad feeling that at 40 my net wealth consisted of a home with a large mortgage and a leased car!

Mind you, my business ipac was growing rapidly but as a small unlisted company at that time it was hard to value. I assume you are putting the maximum amount of $25,000 a year into your super via salary sacrifice, and in terms of super for your wife the answer is yes.

If your wife earns less than $37,000 you can make a contribution of up to $3000 to her super account and receive an 18% tax offset of up to $540. Your may also be able to "split" your contributions with your wife but it can only be done after the end of the financial year and not all funds permit super splitting.

The bigger issue is where to from here. Adding to your offset account is a great idea but before long you will be debt free.

So it is time to plan your next move. This could be to continue to build a share portfolio outside super via your managed funds, or buy an investment property.

I would certainly like to see you with good offshore investment exposure.

RELATED: How to top up your spouse's super (and share in the tax savings)

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Paul Clitheroe AM is founder and editorial adviser of Money magazine. He is one of Australia's leading financial voices, responsible for bringing financial insight to Australians through personal finance books, the Money TV show, and this publication, which he established in 1999. Paul is the chair of the Australian Government Financial Literacy Board and is chairman of InvestSMART Financial Services. He is the chair of Financial Literacy at Macquarie University where he is also a Professor with the School of Business and Economics. Click here to ask Paul your money question. Unfortunately Paul cannot respond to questions posted in the comments section. Please view our disclaimer here.
January 3, 2018 1.02pm

Unfortunately, not very informative. The question was "Can I contribute super for my wife and be tax effective?" So can he contribute 25K via salary sacrifice and another 25K pre-tax for his wife or is there some limit? It is 25K total split between the two? Some super's support this splitting, but I believe others do not. More information on the super question would be useful.

January 3, 2018 2.39pm

Thanks for your feedback, Derek, we've added some more information and linked to a previous story which explains in detail how super splitting works.

- Money team