Increase to Super Guarantee

Understanding the Increase to Super Guarantee: What You Need to Know


As a worker, planning for retirement is crucial, and one aspect that plays a significant role in securing a comfortable future is the Superannuation Guarantee (SG). The Australian government has recently implemented changes to the SG, aiming to enhance retirement savings for employees nationwide. In this blog post, we’ll explore the increase to the Super Guarantee and its implications for both employees and employers.


  1. What is the Super Guarantee?

The Super Guarantee is a mandatory contribution employers in Australia make to their employees’ superannuation funds. It is calculated as a percentage of the employee’s ordinary time earnings (OTE). The purpose of the Super Guarantee is to ensure that individuals have adequate savings for retirement.


  1. The Increase to Super Guarantee:

Effective from 1st July 2021, the Australian government has commenced a gradual increase to the Super Guarantee rate. The rate, which was previously set at 9.5% since July 2014, will incrementally rise over the next few years until it reaches 12% in July 2025.


  1. Phased Implementation:

The increase to the Super Guarantee will be introduced in increments of 0.5% annually. Here’s a breakdown of the planned increments:

   – From 1st July 2021 to 30th June 2022: 10%

   – From 1st July 2022 to 30th June 2023: 10.5%

   – From 1st July 2023 to 30th June 2024: 11%

   – From 1st July 2024 to 30th June 2025: 11.5%

   – From 1st July 2025 onwards: 12%


  1. Impact on Employees:

With the increase in the Super Guarantee, employees can expect higher contributions towards their retirement savings. This change aims to improve the adequacy of retirement funds and reduce reliance on government pension schemes. It is important for employees to be aware of the changes and understand the potential long-term benefits of higher super contributions.


  1. Impact on Employers:

For employers, the increase in the Super Guarantee means additional costs in the form of higher superannuation contributions for eligible employees. Employers should factor in these changes when reviewing their payroll processes and budgeting for the future. Staying compliant with the updated rates is essential to avoid penalties and ensure a smooth transition.


  1. Considerations for Individuals:

While the increased Super Guarantee is a positive development, it is equally important for individuals to actively manage their superannuation. Consider the following tips:

   – Review your super fund’s performance and fees regularly.

   – Assess your investment options and risk profile to align with your retirement goals.

   – Consider making additional voluntary contributions to boost your super savings.

   – Seek advice from financial professionals or superannuation experts to maximize your retirement benefits.



The increase to the Super Guarantee presents an opportunity for Australian employees to build stronger retirement savings. As an employee, staying informed about the changes and actively managing your superannuation can help secure a more comfortable retirement. Employers must ensure compliance with the updated rates and plan accordingly to meet their obligations. Employees and employers can navigate the changes effectively and contribute towards a financially secure future by working together.

Disclaimer: This blog post provides general information and should not be considered as financial or legal advice. Individuals and businesses should seek professional advice specific to their circumstances.

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