Find The Super Fund That Works For You

20:06' 06-06-2018
Many people say they cant understand superannuation, and trust that it will build up in time to provide them with some kind of retirement savings. However, leaving it to chance could mean you miss out on tens of thousands of dollars.
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    Kết quả hình ảnh cho super funds

    Photo: guardiansolicitors.com.au

    When most people enter the workforce, they are given a default super account, chosen by their employer. If they change jobs, they can end up with more than one account. According to Xavier O’Halloran of consumer advocate Choice, there are about 10 million multiple accounts like this. Because super funds charge fees, the multiple accounts are reducing your retirement savings.

    It is important to roll over all these little funds into one fund. Nowadays that is very easy to do, with some funds offering to look for “lost super” on your behalf. You can also use the government portal MyGov, or Choice's Facebook chat bot “Cado”.

    Although this will certainly save you money, and make your super easier to see at a glance, it is not the end of your problems. According to the Productivity Commission, one in four superannuation funds is chronically under-performing. However, to find the best deal, you have to work your way through about 40,000 options to find it.

    A Productivity Commission report, commissioned by the Federal Government, has suggested that the task needs to be made easier. Young people entering the workforce should choose their super fund, not their employer. To help them choose, they should be offered a shortlist of the best performing funds, decided by a “competitive and independent process”.

    The Federal Government is already taking action to improve the superannuation system. In the recent budget, it announced it was making it easier to find lost super, capping fees on low-balance accounts, abolishing exit fees, and cracking down on expensive insurance policies.

    Insurance fees can quickly drain your super, especially if your employer pays your super in quarterly instalments. This can mean your balance drops to zero over three months, then rises with the next quarterly payment, only to fall again.

    It is also important to note that since 2004 super has been “portable”, meaning that in most cases you can keep the same super fund when you change employers.

    For a simple guide to managing your own super, visit www.moneysmart.gov.au/superannuation-and-retirement.

    Somchai R

     

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Keywords: choiceretirement savingssuperannuation

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