Send $10,000 of pre-tax salary into super and $8,500 goes to work. Take it as pay first and only $6,100 reaches your ETF account. The catch: one of them is locked until you turn 60. Here is the 20-year math on that trade.
Adjust the variables below to simulate outcomes, compare rates, and see real-time projections.
A direct comparison of features, rules, limits, and eligibility requirements.
| Feature / Detail | Superannuation (Concessional) | Self-Managed ETF (Non-Super) |
|---|---|---|
Tax on the way in | 15% flat contributions tax, $10,000 of salary becomes $8,500 invested | Your marginal rate first, at 37% + 2% Medicare, $10,000 becomes $6,100 invested |
Tax on earnings | Max 15% on income; 10% effective on gains held over 12 months | Marginal rate on distributions; 50% CGT discount on assets held 12+ months |
Access | Locked until preservation age 60, with narrow hardship exceptions | Sell and withdraw any business day |
Annual limits | Concessional cap $32,500 (2026-27), incl. employer 12% SG; carry-forward of unused cap if balance < $500k | None |
Rule stability | Set by parliament and revisited most budgets | Ordinary tax law; CGT discount has survived decades |
Discipline required | Automatic via employer and salary sacrifice | Entirely on you, every month, through every downturn |
Analyze the advantages and drawbacks of each financial product before making a decision.
Take Marcus, an engineer on $110,000: squarely in the 37% bracket plus 2% Medicare levy. He wants to invest $10,000 of gross salary a year. Route one: salary sacrifice into super, where a flat 15% contributions tax leaves $8,500 invested. Route two: take it as pay (39% gone: $3,900), leaving $6,100 for his ETF account.
Before either dollar earns a cent of return, super is $2,400 ahead: a guaranteed, government-legislated 39% head start on route two's capital. No fund manager, no stock pick, no market timing produces a surer gain than that entry-tax gap.
The gap scales with your bracket: at 30% it is $1,500 per $10,000; at 45% it is $3,000. This is why the standard advice for retirement money is boring and correct: fill the concessional cap first.
Run Marcus's $10,000 a year for 20 years at 7% gross returns. Inside super, $8,500 lands annually and compounds at roughly 5.95% after the fund's 15% earnings tax: about $311,000 by year 20. Outside, $6,100 lands annually and compounds at roughly 5.5% after tax on distributions (helped by the CGT discount): about $213,000.
Same salary, same market, same risk: a $96,000 difference, produced almost entirely by tax structure. And this understates super's edge slightly, because franking credits refund harder against a 15% fund rate than against Marcus's 39%.
The honest counterweight: every dollar of that $311,000 is behind a wall until Marcus turns 60. The $213,000 is his tomorrow morning. That is not a footnote: it is the entire second half of the decision, and it is why the answer is an allocation, not a winner.
The lock is not a small print item. Need a house deposit at 34? Super says no, with one exception: the First Home Super Saver Scheme lets you withdraw up to $50,000 of voluntary contributions (max $15,000 counted per year) plus deemed earnings, keeping most of the tax advantage. For first-home savers, FHSS inside super usually beats saving in ETFs outside it.
Want to retire at 52? The years from 52 to 60 must be funded entirely from outside super: that bridge is an ETF job, and it needs to be built alongside, not instead of, super. Emergency fund? Outside, always.
The 2026-27 caps define the hybrid: employer SG of 12% plus your salary sacrifice up to $32,500 concessional in total, with unused cap from the past five years claimable while your balance is under $500,000: a powerful catch-up lever after a pay rise or career break. Past the cap, non-concessional contributions ($120,000/yr) or ETFs outside super carry the rest. Order of operations, not either/or.
On pure after-tax mathematics, concessional super beats an identical ETF portfolio by roughly $96,000 over 20 years for a 37%-bracket earner contributing $10,000 of pre-tax salary a year: the 15% entry tax and 15% earnings environment are simply too big an edge. But mathematics only applies to money you can leave alone until 60. A house deposit, an early-retirement fund or an emergency buffer in super is a category error, not a tax strategy. So decide by purpose first: retirement money goes to salary sacrifice (up to the $32,500 cap, using FHSS if the goal is a first home), everything with an earlier deadline goes to ETFs, and the common failure mode — leaving retirement money outside super for 'flexibility' you never use — quietly costs six figures.
Workers in the 30%+ brackets with retirement 15+ years away, especially anyone not yet salary-sacrificing to the concessional cap.
House-deposit savers, aspiring early retirees who need income before 60, and anyone whose emergency fund isn't already sorted.
The rules and figures on this page are researched from official primary sources:
