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How to change super funds

Here's our four-step guide to changing super funds online in less than 30 minutes.

Alison Banney
Alison Banney

Updated

Fact checked

Are you thinking of changing your superannuation fund because you want one with lower fees or a longer history of solid returns? Or perhaps you want to switch to a fund with an investment strategy that aligns with your personal values? Whatever the reason, you'll be pleased to know that changing super funds is an easy process that can be done completely online.

We'll go through the steps involved in changing super funds and what you need to consider before switching in this guide.

Steps to changing super funds

There are four steps to changing your superannuation fund:

  1. Compare your options and choose a new super fund
  2. Join your new super fund by completing the online membership application form
  3. Move your super from your old fund into your new fund
  4. Update your super fund details with your employer

Let's get into more detail for exactly what's involved with each step.

Step 1: Choose a new super fund

The first step is choosing your new super fund. When comparing your options, it's a good idea to consider the following factors:

The fees

Like any other financial product or service, you want to avoid paying higher fees than you need to for your super. Fees are deducted before the fund passes on any investment returns to you, so if you're paying high fees, these will quickly eat into your returns.

There's no blanket figure to look for, but as a general rule, annual fees of 1% or lower (as a total of your account balance) are considered to be low fees. You can find more information on how to compare fees in our superannuation fees guide.

Past performance

It's a good idea to look for a fund that has a long history of strong investment returns. This means looking at the average return over a 5 to 10 year period and comparing this against similar funds (it's not a fair comparison to look at a balanced fund against a high growth fund, for example).

Just keep in mind that past performance alone isn't a reliable indicator that the fund will continue to perform well.

Investment options

Super funds are like giant investment portfolios. Each fund will invest your money in a different way depending on what the fund managers believe will deliver the best returns. The majority of super funds invest in a mix of asset classes including local and international shares, property, cash and fixed income.

However, the percentage of your balance invested in each of these asset classes is what differs from fund to fund. For example, a high growth investment option might invest 80% of your super balance in global shares (because shares are considered to be the highest risk asset class). In comparison, a balanced investment option might invest just 40% of your balance in global shares, in order to reduce the risk.

Some super funds also offer ethical or sustainable investment options. As an example, these might avoid investing in companies that manufacture coal, tobacco and weapons and instead invest in renewable energy companies.

When comparing super funds, take a look at the different investment strategies offered by each fund to make sure they've got one that aligns with your investment strategy, the level of risk you're comfortable taking on and you personal values. You can learn more about this in our guide to comparing superannuation investment options.

Compare super funds in the table below

Name Product Past Performance - 1 Year Past Performance - 3 Years Past performance - 5 Years Calculated fees p.a. on $50,000 balance
AustralianSuper - Pre-mixed, Balanced option
Finder Award
AustralianSuper - Pre-mixed, Balanced option
17.03%
10.4%
9.41%
$461.18
AustralianSuper is an award-winning industry super fund and the largest super fund in Australia. The Balanced fund invests in a mix of different assets like shares, property and cash.
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More Info
Sunsuper Lifecycle Balanced
Finder Award
Sunsuper Lifecycle Balanced
15.35%
9.6%
8.99%
$533
Sunsuper is an award-winning super fund with more than 1.4 million members. Its Lifecycle Balanced option invests your super in a mix of growth assets, and reduces your risk when you're near retirement.
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More Info
QSuper Lifetime - Aspire 1
QSuper Lifetime - Aspire 1
14.54%
9.53%
8.96%
$395
QSuper is one of the largest member-owned funds in Australia. The QSuper Lifetime fund adjusts your investments each 7-10 years as you get older, so you're not taking on too much risk.
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More Info
Virgin Money Super - Lifestage Tracker
Virgin Money Super - Lifestage Tracker
21.02%
9.9%
N/A
$358
Virgin Money Super's Lifestage Tracker invests in a range of different assets in line with your age, reducing your risk as you get older, and has some of the lowest fees in the market.
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More Info
HESTA - Core Pool
HESTA - Core Pool
14.03%
9.02%
8.4%
$533.53
HESTA is an industry super fund for the health and community services sector and open to all Australians. The Core Pool invests in a mix of asset classes without taking on too much, or too little, risk.
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More Info
Future Super Renewables Plus Growth
Future Super Renewables Plus Growth
9.24%
N/A
N/A
$958.60
Future Super is Australia's first 100% fossil fuel free super fund and is certified by the Responsible Investments Association Australia. The Renewables Plus Growth option has a 20% asset allocation in renewable energy projects.
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More Info
Spaceship GrowthX
Spaceship GrowthX
26.65%
N/A
N/A
$573
Spaceship's Growth X fund invests heavily in Australian and international shares, with a focus on technology stocks. This is a high-risk investment option that aims to deliver high returns over the long term.
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More Info
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Compare up to 4 providers

The information in the table is based on data provided by Chant West Pty Ltd (AFSL 255320) which is itself supplied by third parties. While such information is believed to be accurate, Chant West does not accept responsibility for any inaccuracy in such information. Chant West’s Financial Services Guide is available at https://www.chantwest.com.au/financial-services-guide . Finder offers no guarantees or warranties about the data and we recommend that users make their own enquiries before relying on this information. Performance, fees and insurance data is based on each fund's default MySuper product. Where the performance, fees and insurance data for the MySuper fund vary according to the member's age, results for individuals between 40-49 years of age have been shown. Past performance is not a reliable indicator of future performance.

*Past performance data is for the period ending December 2019.

Step 2: Join the new super fund

When you've chosen the fund that you'd like to switch to, it's time to join the fund as a new member. To do this, download the new membership form from the fund's website (if you can't find it, it's s usually included in the PDS). You can print this out if you find it easier to fill it in this way.

The form will ask you to provide the following details, so make sure you have these handy:

  • Your personal details including your full name, residential address, contact information and Tax File Number.
  • Your employer's information including the business name, address and ABN.
  • The insurance cover you'd like to include. Most funds will include automatic default death and TPD cover, but you can choose to add income protection cover, or you can opt out of all cover if you don't think you'll need it.
  • The details of your nominated beneficiaries (this is who your super will go to in the event of your death).

The new membership form will also ask you if you'd like to roll over any existing super from another fund into your new fund. This brings us to step three.

Step 3: Roll over the super from your old fund to your new fund

It's really beneficial to make sure you only have the one super fund open in your name. If you have multiple funds, you'll be paying multiple sets of fees. The good news is, your new super fund will do all the hard work for you.

Once you've completed the new membership form, there will be another form asking if you have any super that you want to roll over. If you do want to combine it, you'll be asked to provide the following details:

  • Your existing fund's name and contact number
  • The fund's ABN and USI numbers (you'll find these on your fund's website or on your last account statement)
  • Your membership number and/or account number

The new membership form will have the details of where to send the completed form. Once you've submitted this, your new super fund will contact your old fund and organise for your balance to be transferred over on your behalf. This will be actioned pretty quickly, usually within three business days.

Step 4: Give your employer the details of your new super fund

The last step is to tell your employer that you've changed super funds, so they can start paying your superannuation guarantee payments into your new fund. You'll find another form for this on your new fund's website. It'll be called something along the lines of "Employee super choice form" or "Pay my super into XYZ Fund".

The form will be pre-filled with all the details of the fund that your employer needs. The only thing you'll need to do is add your name and membership number. Give this form to your employer and they'll take care of the rest.

Can I consolidate multiple super accounts into my new fund?

Yes, you can. If you've got more than one super fund and you want to roll them all over into your new fund, you need to complete separate forms for each one (this is the process we outlined in step 3). Your new super fund will contact each of your current super funds to arrange for the money to be transferred.

What will it cost to change super funds?

Some funds do charge an exit fee when you leave the fund and close your account. This will be listed in their PDS on their website. If there is an exit fee, it's usually around $40 to $60. There are no joining fees for opening an account with a new super fund.

Will I need to pay capital gains tax when switching funds?

No, not initially. Capital gains tax is paid when you sell an investment and take the cash, making a profit or a loss. In the case of superannuation, when you roll over your super into another fund, the money stays within the super system. So any tax elements that apply will simply be rolled over to the new fund, and will apply when you eventually withdraw the money.

This wouldn't be the case if you withdrew the money from your super fund into your bank account and then moved it from your bank account to the new fund. If you did this, then you would be required to pay capital gains tax. However, unless you've reached your preservation age (find out what your preservation age is) or met a condition of release, withdrawing your super isn't an option. Instead, the money will stay within the super system and be transferred from one fund to another.

The cost of not changing funds

Paying a $50 exit fee to switch funds is extremely minor when compared to the cost of sticking with a high-fee, poor performing fund. The difference in fees might not seem like much over one year, but when compounded over 20, 30 or even 40 years, the difference really adds up. By switching to a fund that charges 1% lower fees, you could potentially retire with thousands (or even hundreds of thousands) more in your super.

The pros and cons of changing super funds

As a summary of what we've discussed in this guide, here are the pros and cons of changing super funds:

The pros

  • Gives you the opportunity to switch to a fund with lower fees and higher returns
  • Gives you the opportunity to switch to an ethical fund that aligns with your values
  • Reducing your super fees now can have a big impact by the time you reach retirement
  • Changing super funds provides a good opportunity to find any lost super you have and consolidate it all into one fund

The cons

  • An exit fee may apply when you leave your current fund
  • There is a bit of paperwork involved, but this shouldn't take more than 30 minutes to an hour to complete
  • Some employers will only pay your super into their designated fund (although this isn't very common)

Got it! What now?

Now that you know what's involved with changing super funds and what you need to consider, it's time to compare super funds and get the switching process started.

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