Once the kids have grown up and left home, many people find themselves in a position where they want to sell their family home in order to downsize to something smaller and easier to maintain.

When left with a balance of money from the sale of their home, a frequently asked question is: what to do with these funds?

Downsizer superannuation contributions let you place some of the proceeds from the sale of your home into superannuation. However, there are some important eligibility requirements to be aware of before proceeding down this path.

Under the down-sizer contribution scheme, individuals aged 65 years and over who sell their home may contribute sale proceeds of up to $300,000 per member as part of a downsizer superannuation contribution.

The means that up to $600,000 for a couple could be placed into superannuation.

These contributions don’t count towards your non-concessional contributions cap, and can be made even if your superannuation balance exceeds $1.6 million.

This contribution is also exempt from the work test, which usually applies to voluntary contributions by members aged 65 and over.

The Australian government reports that as of June 2019 over 4,000 people around Australia had taken advantage of the initiative in its first year, representing total superannuation contributions of over $1 billion.

The down-sizer scheme is a good opportunity for many Australians to boost their retirement savings, but you must ensure you’re eligible before making a contribution.

If you don’t qualify, your contribution could count as a non-concessional contribution and cause you to breach your contributions cap.