We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
Your superannuation is the main way of saving for retirement. Given the importance of your super, it's important to make sure it's protected and be sure that it's in good hands. Luckily, the Australian superannuation sector is heavily regulated.
In 2019 the government introduced new legislation called the 'Protecting Your Super package. This legislation was introduced to try an stop young people, and people with low super balances, from having their super eaten away by fees and charges.
Here's what's included in the legislation, and why:
If your super account balance is less than $6000 and hasn't received a contribution for 16 months it will be deemed as 'inactive'. If your super is deemed as inactive the money will be sent to the ATO and the ATO will try and track down your current super fund instead, where it'll send the money. Then, your inactive account will be closed. This is to prevent your super being eaten away by fees if you've since opened a new account and forgotten about it.
If your account is inactive (that is, hasn't received a contribution for 16 months) the fund will also need to cancel your insurance and stop charging you insurance fees.
If your super balance is less than $6000 there will also be an annual cap on the annual fees, so they can't be more than 3% of your account balance. Again, this is to prevent your balance being erroded by fees while you might not be working, earning a low income or taking time out of the workforce.
However, annual fees of 3% is still very high, and you should be looking for a super fund that has fees less than 1.5% of your account balance.
Super funds are no longer allowed to charge you an exit fee if you want to leave the fund. You can change super funds at any time, with no fee to do so.
Your super fund will be 'stapled' to you and come with you from job to job. Previously, you could open a new super fund every time you started a new job. This would result in many people having several super funds in their name, and several sets of fees to pay. Now when you start a new job you will take your fund with you, unless you want to switch.
If you are concerned about your employer being able to use money from your superannuation fund, don't be. The money that is accumulated in these funds is held in trust, which means that it is not available for your employer to use.
There is no need to worry about losing your superannuation in the event that your employer goes out of business. Your super fund will be protected even if your employer has to cease operations. Super is completely separate from your employer, and the money is managed by the super fund.
Your super is one big investment portfolio. So yes, when the sharemarket is down this means your super will be too. However, super funds are very diversified and invest in a lot of different things, not just shares. Your super is also invested in things like property, infrastructure, commodities like Gold and Silver and private investments. This helps to minimise your losses as while one market might be down, another market will be up. Another thing to remember is super is a long term investment. While you might have some years of poor performance due to the economy, over the long term it'll keep going up.
Spouse super contributions allow you to grow your partner’s super balance and also save money on tax. Here’s how spouse super contributions work.
Here’s a current list of the worst-performing super funds in Australia and steps for how to switch to a better fund.
Kogan Super offers 5 different investment options that each have low fees and mostly follow an indexed investment approach.
This guide explains how to devise a superannuation strategy that works for you and how to plan for further income in old age, and gives you tips for pulling it all together.
Superhero Super offers two different investment options which both give members more control over how their super is invested. Here's how the super account works.
Superannuation is the main way of saving for your retirement in Australia. Your superannuation is one big investment portfolio in your name that's managed for you by your super fund.
There are 23.2 million super accounts in Australia with assets totaling $3.4 trillion. Find out the latest superannuation statistics.
Finder's International Women's Day report explores the personal finance gap between men and women and the key drivers of financial inequality.
