When was the last time you checked on your super? Could you even say what fund you are signed up to without checking your statement? We know that super isn’t high on everyone’s priority list right now, but taking a little bit of time to do some research to make some changes could make you significantly better off in the future.
This doesn’t have to be a daunting task. Below, we’ve put together four simple steps that could set you up for a more secure financial future.
Step 1: Choose a super fund
Before you can change super funds, obviously you need to find the right fund for you. This could be one with the lowest fees, highest returns, or an investment strategy that aligns with your values. Below are some of the things you should consider when choosing the right super fund for you. Your age, what stage you’re at in your career, and several other factors come into play as to which fund is best for you.
Self Managed or Retail Fund?
The first question you need to ask yourself is which type of fund is right for you. Would you rather take the plunge and manage your own super or leave it in the hands of the professionals? We’ve looked at the pros and cons of Self Managed Super Funds (SMSF) before, so this might be a good place to start.
One of the main reasons people choose to change their super fund is to save money on fees. By checking your chosen fund’s website and Product Disclosure Statement (PDS), you can see what annual or one-off fees they charge. Some of these fees may include administrative and application fees, monthly fees, contribution fees, and more. Make sure to read the fine print so you don’t get any surprises. Most funds also include insurance policies so it would be worthwhile checking if there are any premiums attached.
Ethics and values
More and more people are choosing a super fund whose investment strategies align with their own values. This could be by investing in renewable energy, or choosing not to invest in certain industries, such as the tobacco or mining industry. Want to know more about ethical super funds? We got you.
Most funds default to a ‘balanced’ portfolio, meaning they have some more aggressive investment strategies coupled with some safer options. Depending on your age, income, and courage, you may want to choose a more aggressive or safer option. Your new fund should have details about this on their website, where you can tailor your strategy to your needs. Most funds will offer a range of different policies and will usually have friendly staff on hand to help you make a decision.
When looking at the results your super fund has achieved, make sure to look at the last five years as a minimum, to gauge a better idea of their results. And remember, past results do not guarantee future performance and every investment has some sort of risk. After all, we are dealing with share markets here, and we all know how volatile they can be.
As previously mentioned many retail super funds come with some insurance policies included, such as life insurance as well as income protection, and total and permanent disability insurance. Make sure to check which policies are included in your super fund and how much you are paying for them. It would also be worth checking these policies against your other insurance policies you hold to make sure there is no overlap.
Step 2: Let your boss know
Before signing on the dotted line for a new super fund it is worth talking to your boss or HR manager, as workers in some industries can’t choose their super fund. According to Superguide, this affects about 30% of Aussie workers and could be because their super fund is attached to their enterprise agreement, or their sector has particular rules and regulations.
For the majority of us though, we are free to choose our preferred super funds and our employers aren’t allowed to coerce our decisions. If you feel your boss is trying to influence your choice of Super fund, contact the ATO on 13 10 20
Step 3: Fill out the forms
When you’re getting ready to change super funds, here is some information to have on hand, and where you can find it:
Tax File Number
On myGov if you have attached the ATO to your account, your TFN and all that fun stuff will be on there. It should also be on payslips if you’ve got them lying around.
A Unique Super Identifier (USI) number is used to identify specific super products. This should be provided for you when you choose your new super fund and investment strategy.
This is something you can ask for when you have that chat with your boss or HR manager, and can also be found on your website or on other company documents.
Which forms to fill out and who to give them to
With most retail/commercial super funds you can do the entire application process online in a matter of minutes.
Once your account is open, you can download this form from the ATO and give it to your HR manager, payroll manager, or whoever it is in your company that looks after payroll. Sometimes companies have their own internal documents which look after these matters, just make sure all the details that the ATO asks for on their form is on the one you are given.
That’s it. Four simple steps you can take now, that future you will be so grateful for.
Learn more about superannuation
Discover our latest articles on all things super.Learn More
Oiyo is a consolidated online resource, we are not financial advisors. We work with a range of industry professionals and compliance check our articles to ensure factual accuracy. However, we do not provide professional financial advice. Consider seeking independent legal, financial, taxation or other advice to check how the information and ideas presented in this article relate to your unique circumstances.