3 things to check in your super fund statement
Your first port of call is to see how your fund balance has grown over the year. This will be based on a combination of contributions made to your super plus investment returns.
The majority of Australians have their super in a ‘balanced’ investment option, which provides strong exposure to sharemarkets. According to research by Lonsec, the top 20 balanced funds all returned 18%-plus over the last financial year – a great result that few would have predicted 12 months ago.
Along with your fund balance, be sure to check out what you’re paying in fees. Research group Canstar crunched the numbers and found fund members in a default investment option can pay between 0.88% and 1.24% of their super savings in annual fees.
Paying more doesn’t necessarily mean earning a better return. But it can mean having less to spend in retirement. If your fund is at the more expensive end of the spectrum, it could be time to shop around and see if you could get better value with a different fund.
The third aspect to check is the level of insurance through your fund. Insurance in super often represents a good deal. It’s automatic and the premiums tend to be lower than if you buy similar cover independently.
The downside is that default cover isn’t tailored to your needs. So it’s up to you to be sure you have enough cover in place. The MoneySmart website features an online life insurance calculator that can help you get a clear idea of how much cover you and your family need. If it turns out you’re underinsured, it’s easy to give your cover an uptick just by contacting the fund. The downside is that this will mean paying higher premiums, which can lower the final balance of your super on retirement.
If you don’t receive a statement for your super, the warning bells should start ringing. It may be that your fund doesn’t have correct contact details – something that can happen if you’ve moved but haven’t told your fund. It’s a cue to get in touch with your fund and update your details so you can stay in touch with your super though your working life.
Paul Clitheroe is Chairman of InvestSMART, Chair of the Ecstra Foundation and chief commentator for Money Magazine.
Frequently Asked Questions about this Article…
To see if your super fund balance has grown, review your annual statement. It will show the combination of contributions made to your super and the investment returns over the year.
A 'balanced' investment option in super funds typically provides strong exposure to sharemarkets. It's a popular choice among Australians, with top funds returning over 18% in the last financial year.
Super fund fees for a default investment option can range between 0.88% and 1.24% of your super savings annually. It's important to compare fees as paying more doesn't always mean better returns.
Checking your super fund's insurance level is crucial because default cover may not meet your personal needs. You can adjust your cover, but be aware that higher premiums could reduce your final super balance.
If you don't receive your super fund statement, contact your fund to ensure they have your correct contact details. This is important to stay informed about your super throughout your working life.
Yes, if your current super fund is on the expensive side, it might be worth shopping around. You could find a fund with lower fees and potentially better value for your retirement savings.
Use the MoneySmart website's online life insurance calculator to assess if your super fund's insurance cover meets your needs. If you're underinsured, you can increase your cover by contacting your fund.
Insurance through your super fund often offers lower premiums than buying independently, and it's automatically included. However, ensure it aligns with your personal coverage needs.
Call 1300 880 160
Start a chat
Schedule a call
