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$33 billion of unpaid superannuation: Have you got the right amount?

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Workers are missing out on billions of dollars worth of unpaid super each year. Here's how to check that yours is right.

New research from Industry Super Australia reveals Australian workers have missed out on a combined $33 billion worth of unpaid superannuation over the past 7 years. This amounts to $4.7 billion worth of unpaid super each year that workers are missing out on.

One reason that some workers might not be getting paid the correct amount of super (or no super at all) is due to the nature of how super is paid.

The super guarantee is legally required to be paid to workers at least quarterly (4 times per year). However, because most people get paid weekly, fortnightly or monthly, the frequency in which super is paid doesn't line up at all with when wages are paid.

Because super isn't paid at the same frequency as wages, it makes it more difficult to notice if you haven't been paid correctly.

Due to the large amount of unpaid super each year, there are increased calls for the government to mandate super payments at the same frequency as wages.

According to Industry Super Australia, paying super in line with wages would not only help reduce the amount of unpaid or underpaid super but also boost returns for members.

Its modelling shows that a 30-year-old earning the age-based median wage could be $8,000 better off at retirement if paid super fortnightly instead of quarterly. This is because super contributions would compound for longer if paid more frequently.

How to check you're getting the right amount of super

The current super guarantee rate is 10.5% of your annual income. Note that this is what your employer is legally required to pay you, but if you're a sole trader, you aren't required to pay yourself this exact amount.

So, the easiest way to figure out how much super you should be getting paid is to calculate what 10.5% of your annual earnings are.

If you get paid super contributions from your employer quarterly, divide your annual super amount by 4 to see how much you're owed each quarter.

For example, if you're earning $100,000 your employer needs to pay you $10,500 for the year in super contributions. This should equate to $2,625 per quarter.

Another way to check that you're being paid the correct amount of super is to look at your pay slips.

Most pay slips will include the super contributions you've earned for that pay period. Add these up for the quarter and check that the amount you're actually paid for that quarter matches what's listed on your pay slips.

If you haven't checked how your fund is performing for a while, it could be time to compare super funds and make the switch. Switching to a high-performing super fund can help you retire with tens of thousands of dollars more (it's easy to change super funds, we promise!).

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