Choose a super fund that’s right for you
Finding a super fund that suits you might sound obvious, but over 55% of 18-34 year olds go with the default option provided by their employer.1 The good news is this number is coming down as more young people take an active interest in what’s happening with their money.
When choosing a super fund, look closely at the fees you’re paying. ASIC’s MoneySmart website suggests a 1% difference in fees now could contribute to as much as a 20% difference in 30 years’ time.2
MoneySmart also says:
Choosing a super fund is a bit like dating. Pick the right fund and you'll be set for a long, happy and comfortable life when you retire. Set your sights on the wrong one and you're in for a world of pain.3
Consolidate your super
For every job you’ve had, you could have super that's in a different fund. You can choose to bring all your super together into one fund, but you need to find it first. The Australian Taxation Office offers a service that can help you find any lost super – you just need to register for MyGov to use it.
If you do decide to combine all your other super into one account, it makes sense to consider if you can transfer any insurance cover, replace any insurance cover you might lose and whether there are any costs, risks and tax implications from consolidating.4
Make extra contributions
Making extra contributions to your super could be tax effective and give your super balance a boost. The earlier you are able to start making these contributions, the more time they have to accumulate – over 30 years, a relatively small amount like $20 a week extra may make a real difference. Get an estimate of the impact you could see in your super balance when the time comes to retire by using MoneySmart’s superannuation calculator.5
It’s also possible to get co-contributions from the government. People earning up to $53,564 a year can qualify for government co-contributions, and the amount you’re eligible for will vary depending on how much you earn.6 If you earn less than $38,564 a year and you contribute $1,000 extra per year to your super, the government will put in the maximum co-contribution amount of $500.