When it comes to building long-term wealth, one of the biggest questions many Aussie investors ask is: should I invest inside my super or outside of it?

In this episode of the Get Rich Slow Club, Tash and Ana break down the key differences between these two options, weigh the pros and cons, and share their own approaches. Whether you’re just starting to invest or already thinking about retirement, this conversation is full of practical insights.

Understanding the difference between investing inside vs outside super

The first step is understanding that superannuation itself isn’t an investment . It’s a vehicle that holds your investments – like shares, ETFs, bonds and cash – until you reach retirement age.

On the other hand, investing outside of super typically means using a broker to buy shares or ETFs in your own name. The investments are yours to access at any time, but they also come with different tax implications.

As Ana puts it: “The biggest differences are the tax on the money, and when you can access your money.”

• Access : Super is locked away until you reach preservation age (usually 60), whereas investments outside of super can be sold at any time.
• Tax treatment : Super has concessional tax rates – typically 15% on earnings – which is much lower than most income tax rates. Outside super, your investments are taxed at your marginal rate. With that said, tax can vary between individuals, so speak with a tax accountant if in doubt.

Why people choose to invest inside super

One of the biggest advantages of investing inside super are the potential tax benefits . Not only are earnings taxed at a lower rate, but you may also be able to claim a tax deduction on contributions made via salary sacrifice or personal contributions (up to a cap).

“I was salary sacrificing at my old job and it was awesome," says Ana. "My money was going into my super and growing. I was getting taxed less and bringing down my taxable income. I think it's a really great strategy that a lot of people use.”

Other potential benefits of investing through super include:

• Set-and-forget structure : Your employer contributes to your super on your behalf (currently 11.5%, rising to 12% on 1 July 2025), and many super funds offer diversified, ready-made portfolios to invest in.
• Long-term focus : Since you can’t access the money until retirement, it encourages a disciplined approach.
• Peace of mind : Thanks to the strict regulations that apply to super funds , many people find it reassuring to know their money is being professionally managed and invested for the long term.

And while the long wait until retirement might seem daunting, Ana points out that it can also be reassuring.

“The part that I find exciting about super is just tracking how it grows," she says.

There are also specific schemes like the First Home Super Saver (FHSS) scheme , which allows eligible Australians to make voluntary contributions into super and withdraw them later for a home deposit.

The drawbacks of investing inside super

Despite the tax advantages, super does have its downsides – most notably, lack of access.

For starters, preservation age (when you can withdraw your super) means you need to wait until at least age 60 before accessing most of your super.

This inflexibility can be challenging, particularly for people with evolving life plans.

“For the longest time, I didn’t want to put extra money into my super because I didn’t know if I was going to stay in Australia," Ana says. "It was really limiting for me.”

Other drawbacks include:

• Contribution caps : There are annual limits on how much you can contribute to super. Currently, the limits are $30,000 for concessional contributions and $120,000 for non-concessional (after-tax) contributions.
• Limited investment options : Most super funds offer a handful of pre-set options. However, some super platforms offer more control, letting you pick your own investments.
• Locked-in rules : Even with favourable legislation now, future rule changes can impact your access or taxation.

Still, Tash and Ana agree that it’s a great system for Australians overall.

“We’re really lucky to have access to something that sets us up for retirement,” Ana says. “It’s quite unique and special.”

Why you might invest outside of super

Outside of super, you’ve got total control. You can choose your investments, access your funds whenever you like, and shape your strategy to fit your lifestyle.

“I wanted that liquidity,” Ana explains. “I like getting the dividends. I wanted to be able to pull that money out in the case something happens.”

Other key benefits include:

• Flexibility : Access your money at any time. This can be ideal if you’re saving for a home , planning a career break, or aiming for early retirement .
• Customisation : You can build your own diversified portfolio or invest in specific ETFs, sectors, or international markets.
• Potential for income today : Any dividends and capital gains you might earn are available to you now – not decades from now.

The risks and trade-offs of investing outside super

Investing outside of super does come with responsibilities. Unlike super, which your employer contributes to automatically, this path requires you to be proactive and consistent.

Some common drawbacks include:

• Discipline required : Because it’s so easy to access your funds, you may be tempted to sell investments or stop investing altogether during tough times.
• Higher tax : Interest earnings and dividends are taxed at your personal tax rate – up to 45% for high earners. Capital gains are also taxed , though there is a 50% discount if you hold assets for over a year.
• Admin and paperwork : “There’s more taxes and paperwork,” Tash warns. From broker statements to share registry updates and tax returns, it can be a bit of a chore.

That said, Ana points out that “ passive income is key.” You can reinvest dividends , fund your lifestyle, or use them for major expenses. This gives you more options than a locked-up super fund. However, it's crucial to note that returns aren't guaranteed.

So, which one is better?

The honest answer? It depends.

Tash and Ana emphasise that your investing strategy should align with your goals, income, and lifestyle. Ask yourself:

• Do I want flexibility or long-term discipline?
• Am I looking to reduce my tax bill ?
• Do I plan to retire early or work until preservation age?
• How comfortable am I choosing my own investments?

Ana shares that she currently invests outside of super, mainly due to her part-time work and desire for liquidity.

“Previously, I was salary sacrificing into super when I was on a higher income and wanted to use the First Home Super Saver scheme,” she explains.

(NOTE: you can read about Ana’s experience with the FHSS scheme here .)

Tash, who pays herself a salary as a self-employed business owner, is also focusing on investing outside super – at least for now.

“It feels too far away and often the rules are so complex and confusing," she says. "I’m sure I’ll change my mind in the future because there’s definitely circumstances where it’s amazing."

Your strategy should evolve over time

Ultimately, you don’t have to pick just one. Many Australians invest both inside and outside of super at different points in life. As your income, goals and family situation change, so should your approach.

Ana says she’s already thinking ahead.

“Because I’m a bit older than my partner, I might want to put more into my super because I’ll be able to access it sooner," she says.

They also touch on gender disparities in super balances and suggest exploring strategies like super contribution splitting, especially if one partner takes time off for parental leave. This allows one partner to transfer super contributions to the other to help balance retirement savings.

Ana sums it up: “That’s why it’s important to know as much as you can about super – investing inside or outside – so you can reach your own goals.”

Luckily, we’ve got plenty of superannuation resources in the Pearler blog.

Wrapping it all up

Whether you’re investing through your super or taking control of your portfolio outside of it, the important thing is that you’re investing at all.

Both paths offer different benefits, and neither is wrong. What matters most is understanding how each fits into your life today and what you want for the future.

And remember, your strategy isn’t set in stone. Revisit it regularly, especially as your circumstances change. Whether it’s through super, shares, ETFs or all of the above, the key is to stay informed and take action.

Keen to learn more? Check out our guide to investing inside versus outside super .

If this episode sparked something in you, give it a five-star rating, drop a review, or better yet, share it with a friend. And if you're just starting out, the first ten episodes will get the financial gears turning. Follow us at @getrichslowclub and catch our personal updates at @tashinvest or @anakresina.

Happy investing!