Superannuation Strategies for Tertiary Sector Employees

CORPORATE FINANCE
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Executive summary
There are various strategies that can be implemented by an organization in order to help their
employees to develop the habit of savings but one of the most useful strategies is to implement
funding with the help of superannuation. The superannuation strategy has proved to be very
beneficial for the organizations to help the employees to gain benefit on their savings. It is not
possible for an employee or an individual to save because of which they are restricted from
earning returns by investing it. Hence, this report consists of several factors which are required to
be taken into account by the tertiary sector employees so that they can judge whether they should
invest their savings in the superannuation approach or not. The different type of plans for the
employees and a clear discussion on time value of money have been discussed in the report
below which will help in proper analysis.
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Contents
Contents........................................................................................................................ 3
Introduction.................................................................................................................... 4
Superannuation contributions.............................................................................................. 5
Relevant factors for decision making..................................................................................... 7
Time value of money........................................................................................................ 8
Conclusion and Recommendations....................................................................................... 9
Bibliography................................................................................................................ 10
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Introduction
By implementing the concept of superannuation strategies in the organizations, the management
tries to develop the habit of investment and savings in their employees (Berry, 2009). The
collection of the funds from the employees as a part of their salary and investing them in the
activities which can help them to earn more return on their investment will be of great value to
the employees. However, it is necessary for the employees of the tertiary sector to make a clear
analysis of all the factors so that they can determine the choice of the plan they are going to
invest their savings in. Basically, two types of superannuation strategies are present in which the
employees can invest their savings which are: investment choice plan and defined benefit plan
(Boyd, 2013). Also, it is very important for the employees to consider time as an important factor
while making investments because of the volatility present in the market conditions and the
stocks they plan on investing in. A clear analysis of all these factors will help them to ensure
sufficient returns on their investments that have been made using their savings.
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