Starting work? A guide for teenagers joining the workforce

When you start your first job you'll need to open a bank account, a super fund and understand what your tax obligations are.

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There's a few things to organise before you start your first job. Firstly, you'll need a bank account to receive your salary or wages into. And as soon as you start earning an income, you'll also be required to lodge a tax return and your employer may be required to make superannuation payments into your nominated fund.

Superannuation for teenagers and new workers

Superannuation is compulsory for Australian workers. Superannuation is how you'll save for retirement (even though this seems like a long way away now!). If you're over 18 years of age earning a minimum of $450 monthly before tax, you will be entitled to superannuation guarantee contributions from your employer.

Your employer is required to pay 10% of your annual earnings into your super fund. This figure will gradually increase over the next few years until it gets to 12%. Similar to tax, your superannuation contributions are something that your employer is required to manage on your behalf. Your employer will pay the super you're entitled to into your nominated fund each quarter.

Your employer may have a preferred super fund, but you're also entitled to choose your own fund. as a young person new to the workforce, it's important to look for a fund that charges low fees. You might also want to consider what insurances you need, if any, included in your super. For example, if you're in your teens you may not think it's necessary to have life insurance or income protection.

What you need to do

  • Compare super funds (you can do this in the table below) and join the fund as a member.
  • Complete the superannuation choice form that your employer gives you with your super fund details and membership number.
  • If you're entitled to super contributions, make sure your employer is paying these by regularly checking your payslips and your super fund statement.

Promoted
Virgin Money Super LifeStage Tracker has one of the lowest fees in the market and has strong 3 year performance. It invests in a mix of assets in line with your age, reducing your risk as you near retirement. The investment team was named a Responsible Investment Leader 2020 and 2021 by the Responsible Investment Association Australasia.
Promoted
Finder Award
Finder Awards Winner 2019: Best Super Fund - Growth

Sunsuper Lifecycle Balanced is a MySuper fund that invests in a large range of asset classes and adjusts your investment mix in line with your age.

Compare super funds when starting work

Name Product Last 1 year performance (p.a.) Last 3 year performance (p.a.) Last 5 year performance (p.a.) Last 10 year performance (p.a.) Fees on $50k balance (p.a.)

AustralianSuper - Pre-mixed, Balanced option

Finder Award
AustralianSuper - Pre-mixed, Balanced option
+20.46%
+9.6%
+10.46%
+9.74%
$476
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.

Virgin Money Super - LifeStage Tracker

Virgin Money Super - LifeStage Tracker
+22.17%
+10.04%
New Fund
New Fund
$363
Virgin Money Super LifeStage Tracker has one of the lowest fees in the market and has strong 3 year performance. It invests in a mix of assets in line with your age, reducing your risk as you near retirement. The investment team was named a Responsible Investment Leader 2020 and 2021 by the Responsible Investment Association Australasia.

Sunsuper Lifecycle Balanced

Finder Award
Sunsuper Lifecycle Balanced
+20.62%
+8.77%
+9.84%
+9.06%
$558
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.

Australian Ethical Super Balanced

Green Company
Australian Ethical Super Balanced
+17.96%
+10.33%
+9.67%
+9.01%
$622
Certified by the Responsible Investment Association Australasia.
Australian Ethical seeks to invest in companies that have a positive impact on the planet, people and animals, such as renewable energy and healthcare while avoiding investments in coal, oil, tobacco and gambling.

Spaceship GrowthX

Spaceship GrowthX
+23.41%
+15.25%
New Fund
New Fund
$536
This is a high-risk investment option that aims to deliver high returns over the long term.
Spaceship's GrowthX fund invests heavily in technology ETFs with high exposures to Australian and international shares. Performance figures and fees supplied by Spaceship, not Chant West.

QSuper Lifetime - Aspire 1

QSuper Lifetime - Aspire 1
+17.11%
+9.02%
+8.61%
New Fund
$360
QSuper is one of the largest profit-for-members funds in Australia. QSuper Lifetime continually adjusts your investment mix in line with your age and your super account balance.

UniSuper Balanced

UniSuper Balanced
+17.6%
+9.23%
+9.55%
+9.55%
$326
UniSuper is an industry super fund and one of Australia's largest super funds with more than 450,000 members. Its Balanced option invests in a mix of different asset classes and charges some of the lowest fees of all default super products.

Aware Super Growth

Aware Super Growth
+18.02%
+8.81%
+9.8%
+8.97%
$519
Aware Super is a not-for-profit fund with more than 750,000 members. The MySuper product invests your super in a pre-mixed Growth fund until you’re 60, then it’ll switch to Balanced.

HESTA Balanced Growth

HESTA Balanced Growth
+19.03%
+8.48%
+9.39%
+8.87%
$533
HESTA is an industry super fund for the health and community services sector and open to all Australians. The Balanced Growth fund invests in a mix of asset classes without taking on too much, or too little, risk.

Australian Catholic Super Lifetime - Grow

Australian Catholic Super Lifetime - Grow
+17.36%
+7.42%
New Fund
New Fund
$528
A Catholic super fund open to all Australians and designed for people working in Catholic education, healthcare or aged care.The Lifetime One fund option changes your investment mix as you get older.

Verve Super Balanced

Verve Super Balanced
+12.85%
New Fund
New Fund
New Fund
$691
Verve Super is an ethical super fund tailored for women. It seeks to invest in companies making a positive impact, such as renewable energy and women in leadership, while avoiding those that cause harm, such as fossil fuels, tobacco and guns.

Superhero Super Autopilot

Superhero Super Autopilot
+14.52%
+8.39%
New Fund
New Fund
$429
Superhero Super Autopilot allows you to invest up to 30% of your super in different themed ASX shares and ETFs, with at least 70% of your balance invested in the Vanguard Global Diversified Index Portfolio. Performance and fees are based on having 100% of your balance in the index portfolio.

REST Super - Core Strategy

REST Super - Core Strategy
+17.43%
+7.17%
+8.26%
+8.43%
$467
REST is an industry super fund tailored towards the retail sector and open to all Australians with almost 2 million members. The Core Strategy is a diversified investment portfolio that balances risk and return.

AustralianSuper - Socially Aware

AustralianSuper - Socially Aware
+19.4%
+7.89%
+9.25%
+9.2%
$501
The AustralianSuper Socially Aware option doesn't invest in Australian or international companies that directly own coal and fossil fuel reserves, produce tobacco or those which have single-gender boards. Investment performance as of 30 June 2020.

Aware Super - Diversified Socially Responsible Investment

Aware Super - Diversified Socially Responsible Investment
+15.23%
+8.1%
+8.28%
+8.12%
$406
The Aware Super Diversified Socially Responsible Investment is a pre-mixed investment option that excludes companies operating in the tobacco, ammunition, gambling, alcohol, forest logging and pornography industries, as well as companies that attribute 20% or more of their revenue to coal, oil and gas.

Sunsuper - Socially Conscious Balanced

Sunsuper - Socially Conscious Balanced
+19.6%
+8.76%
+8.83%
+8.25%
$463
Certified by the Responsible Investment Association Australasia.
The Sunsuper Socially Conscious Balanced option avoids investment in companies that have significant exposure (more than 5% of revenue) to alcohol, tobacco, gambling, pornography, coal and nuclear power manufacturing. Investment performance as of 30 June 2020.
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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 June 2021.

Opening a bank account in your name

If you don't already have one, you'll need to open a bank account in your name to receive your salary or wages into. It's very rare to be paid in cash these days, and even if you are paid in cash it's a good idea to have a bank account to deposit the money into where it's safe.

Your bank account will come with a debit card that you can use to access your money at ATMs and EFTPOS terminals.

What you need to do

  • Open an Australian transaction account that accepts deposits (not a savings account).
  • Your employer will give you a form to complete with your bank details. Fill in the BSB and Account Number for your bank account, which can be found in your Internet or mobile banking portal.
  • Get into the habit of checking you're paid correctly each payday by looking at your payslip and making sure this is the amount that was put into your bank account.

You can compare Australian bank accounts in our guide, and open one online for free in minutes.

Your tax obligations when starting work

When you branch out on your own and start earning an income you'll be required to lodge a tax return and pay tax. That is, if you earn enough to be taxed. Working Australians who earn less than $18,200 in a year are not required to pay any tax. If you earn over this, you'll need to pay tax according to how much you've earned.

If you're required to pay tax, you don't personally need to make this payment to the Australian Taxation Office (ATO) yourself (unless you're self-employed). Your employer will withhold a percentage of your pay each payday for tax. At the end of the financial year if you've paid too much tax throughout the year you'll get the amount you've overpaid back. If you haven't paid enough tax, you'll be required to pay the amount owing.

To help manage this process, it's important that you set up your tax file number. This number stays with you throughout your working life, and is used by both your employer and the ATO to ensure you're paying the correct amount of tax. If you don't set up a tax file number your employer will be forced to withhold tax from your salary or wages at the highest tax rate (currently 45%).

What you need to do:

  • Register with the ATO to get yourself a tax file number
  • Give your tax file number to your employer (they'll provide you with a form to complete)
  • Lodge your tax return with the ATO at the end of the financial year before the October 31 deadline. You can do this yourself online or you can use a tax agent.
  • Remember to claim any work-related expenses as a tax deduction. You can learn more about what you can and can't claim on tax in our deductions guide.

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