· Your biggest asset might be sitting outside your retirement plan
· Eligible homeowners can move up to $300,000 into super (or $600,000 for a couple) with “downsizer” contributions
· You don’t need to buy a smaller property to benefit from downsizer contributions
· Timing maters – so plan ahead if you want to make the most of this tax effective strategy
As spring selling season gets underway, Australians aged 55 and over are being encouraged to look beyond the sale price and consider whether a little-known superannuation rule could help boost their retirement savings.
A downsizer contribution allows eligible Australians to contribute up to $300,000 each from the sale of their home into super, allowing couples to contribute up to $600,000 combined. Unlike many other voluntary contributions, downsizer contributions do not count towards the usual contribution caps.
The opportunity is gaining momentum, with Australian Tax office ATO data showing approximately 19,700 Australians contributed $5.2 billion through downsizer contributions in 2025-26.
Aware Super Head of Guidance Lynda Cross said many Australians are unaware that selling a home could also create an opportunity to boost retirement savings.
"For many Australians, the family home is their biggest asset, but it's often sitting outside their retirement strategy.
"If you're already thinking about moving, a downsizer contribution can be a powerful way to put some of that housing wealth to work for your retirement.
"It can help boost your super balance, keep more of your money invested for the future and potentially provide greater financial flexibility and confidence in retirement."
What is a downsizer contribution?
A downsizer contribution allows eligible Australians to contribute proceeds from the sale of their home into super, even if they are already retired. Eligible individuals can contribute up to $300,000 each, while couples may be able to contribute up to $600,000 combined.
Importantly, despite the name, Australians do not need to buy a smaller property to be eligible.
"One of the biggest myths is that you have to move into a smaller home," Cross said.
"You don't even need to buy another property. What matters is meeting the eligibility rules following the sale of an eligible home."
Why are Australians using downsizer contributions?
According to Cross, downsizer contributions have become increasingly popular because they offer one of the few opportunities to make a significant contribution to super later in life.
"There's no upper age limit or work test to make a downsizer contribution, so you can contribute even if you're no longer working.
"For many people, downsizing can be an opportunity to turn part of their home's value into retirement savings. Rather than sitting in a bank account, that money can stay invested through super and continue working for you.
"Super can also be a tax-effective environment for retirement savings, and downsizer contributions sit outside the usual contribution caps, making them a unique opportunity for eligible Australians to boost their balance later in life."
However, Cross said selling the family home is a significant financial and lifestyle decision and should never be driven by the super contribution opportunity alone.
"Before making any decision, it's important to think about transaction costs, ongoing living expenses, lifestyle factors and any impact on Age Pension entitlements.
"Downsizing can bring benefits beyond your super too. Some people are looking to reduce maintenance, lower household expenses or free up money to enjoy retirement.
"The downsizer contribution can be incredibly valuable, but it's not a one-size-fits-all strategy."
What are the eligibility rules?
Australians may be eligible if they:
- Are aged 55 or over.
- Have owned the property for at least 10 years (either individually or with a spouse).
- Sell an eligible Australian home.
- Make the contribution within 90 days of receiving the sale proceeds.
- Provide the required downsizer contribution form to their super fund before or at the time of making the contribution.
About us:
Aware Super is one of Australia’s largest profit-to-member superannuation funds, investing about $245 billion around the world on behalf of around 1.3 million members. We strive to deliver strong long-term returns1 for our members and the help, guidance and advice2 they need to prepare for and enjoy their best possible retirement. Visit the Aware Super Newsroom for the latest news, announcements and insights from Aware Super.
This article contains general information only and does not take into account your objectives, financial situation or needs. Eligibility rules apply to downsizer contributions. Before making any decision about your super or retirement planning, consider whether the strategy is appropriate for your circumstances and seek financial advice if required.
1. Aware Super's High Growth option return over 10 years to 30 June 2026. SuperRatings Fund Crediting Rate Survey, June 2026. Based on the SR Growth (77-90) Index. Returns are after tax and investment management expenses but before the deduction of administration fees. Past performance is not an indicator of future performance.
2. Advice provided by Aware Financial Services Australia Limited (ABN 86 003 742 756, AFSL 238430), wholly owned by Aware Super.
Contact details:
Sarah Goodwin, Senior Media Manager, 0401 769 296, [email protected]