Superannuation, insurance and sometimes finance in general can be confusing; there is so much jargon and so many acronyms. So we have put together this handy glossary to help you make sense of it all.
Additional employer contributions – Any extra contributions made by your employer over and above the mandated employer amount.
APRA – The Australian Prudential Regulation Authority (APRA) is the regulator of institutions such as banks, credit unions, building societies, general insurance companies, life insurance companies and most members of the superannuation industry . You can find out more on their website.
ASFA – The Association of Superannuation Funds of Australia (ASFA) is a national, not for profit, non- party- political organisation that represents the interests of Australia’s superannuation funds, their trustees and their members. You can find out more on their website.
ASIC – The Australian Securities and Investments Commission (ASIC) is Australia’s corporate, markets and financial services regulator. It regulates Australian companies, financial markets, financial services organisations and professionals who deal and advise in investments, superannuation, insurance, deposit taking and credit . You can find out more on their website.
ATO – The Australian Taxation Office’s (ATO) role is to manage and collect tax. The ATO is also the regulator for Self-Managed Super Funds.
Australian Securities Exchange (ASX) – The marketplace for trading shares, bonds and other securities in Australia. They also regulate the brokers and provides fair rules for trading.
Beneficiary – A person who is entitled to a payment from a super fund or life insurance policy, or from other types of trusts.
Concessional contribution – Contributions made to superannuation from before tax income for which a tax deduction can be claimed. These contributions include Superannuation Guarantee (SG) contributions, additional employer contributions and contributions made by self-employed for which they can claim a tax deduction.
Contribution cap – The limit on the amount of contributions an individual can make to their superannuation fund without incurring additional tax.
Death benefits – Amount payable to a member’s beneficiary or dependant in the event of the member’s death.
Diversification – Spreading your investments among different investment types and asset classes. This may reduce your overall risk and/or the volatility in investment returns.
Financial adviser – A person who is licensed to give you advice on financial matters including investment, superannuation and insurance.
Fund manager – The person or team who is responsible for the investments within the fund including managing the day to day portfolio trading.
Income protection insurance – Insurance that pays you a benefit if you are unable to work due to illness or accident
Insurance – Purchasing financial protection against a future possible event. If the event occurs, the insurance company will pay the insured benefit.
Life insurance – There are different types of cover that fall under the broad heading of life insurance. Depending on your circumstances you may need one or more. Life insurance is insurance against unexpected death, total and permanent disabilities, temporary disability resulting in loss of income or trauma incidents.
Managed fund – A fund where money is pooled with others and professionally managed. You purchase units and receive a share of the returns.
Managed Superannuation – A service provided by Camori Investments where a proactive approach is offered to managing your superannuation investments.
Member protection – If you have less than $1000 in any one superannuation account, the member protection rule limits the amount of administration charges that can be deducted. This doesn’t include any insurance premiums. It’s recommended to consolidate your superannuation into one account and our free Find Your Superannuation service can assist you.
Non-concessional contribution –Contributions made to your superannuation for which a tax deduction cannot be claimed. For example making contributions using your after-tax income. Other terms used are post-tax contributions or after-tax contributionsOutperformance – The achievement of a higher investment return than a benchmark or other measure against which that return is compared.
Outperformance – The achievement of a higher investment return than a benchmark or other measure against which that return is compared.
Portfolio – Your range of holdings as an investor.
Product Disclosure Statement (PDS) – A document provided by the issuers of a financial product which provides information about the product including issuer, benefits, risks and costs of the product.
Premium – The amount paid for your insurance policy. In some cases, your premium can come directly from your superannuation fund.
Salary sacrifice contributions – If offered by your employer, contributions can be made from your pre-tax salary.
Self-Managed Superannuation – A superannuation fund where you get to make the investment decisions for your fund and control the direction of your future financial situation. Camori Investments can help you with your self-managed superannuation.
Super Guarantee (SG) contributions – Compulsory contributions paid by your employer. Currently the minimum level of SG is equivalent of 9.5% of ordinary time earnings.
Tax File Number (TFN) – A unique reference number provided by the ATO to every tax-paying individual and entity.
Unclaimed superannuation – Superannuation that is held in accounts that people are unware of or have lost. Use our Find My Superannuation (insert link) service to locate all your superannuation.
Yield – Your return on investment expressed as a percentage.