This isn't really that surprising, when you consider how easy it is to just let someone else choose a super fund for you. But changes to the super industry might mean it's going to be critical for you as an individual to be able to compare and spot the differences between super funds.
During the big super funds' conference a few years ago, some movers and shakers sat down to discuss the current and future state of superannuation in Australia. One of them said that "sooner or later super will be taken out of modern awards or employers will be given to choose any public fund or MySuper fund". That means that bosses won't be bound by the award when choosing the default fund that new employees get put with if they don't nominate another one. In future, your employer could choose a random fund that doesn't suit your needs or match up with your beliefs about how you want your super money invested.
That means it'll be more important than ever for you to be able to make a smart choice about which super fund you want to go with. But comparing and choosing the right fund isn't easy.
At 30 June 2023 Australia’s population was 26.6 million people1, while there were around 24.4 million superfund accounts in Australia2. This suggests that some people, when moving jobs, simply move on to a new default super fund. Roughly 60% of super accounts were a default fund3, There are over 800,000 Australians in their 30’s who have their super in a default fund4.
10 quick questions to help get you started
If you're thinking about changing funds to make sure you're getting the best bang for your buck, here are a few questions you can ask yourself:
1. What are the fees like? (generally, the lower the better.)
2. What investment options do they offer? (In other words, do they offer an investment option that suits the level of risk I'm comfortable with?)
3. How easy do they make it to arrange salary sacrificing?
4. How well has the fund performed over the last five years? (In other words, what kind of a %-return have they achieved compared to other funds?)
5. Does the fund offer any free extra services that might be handy?
6. What kind of insurance is included with this fund's accounts?
7. What sort of things does this fund invest in?
8. Do I want a fund that meets my religious or ethical standards? (In other words, a fund that does not invest in things I disagree with.)
9. Is the fund for profit or not for profit?
10. How easy is it to communicate with this fund? (Are their customer service people responsive and helpful? Can some (or all) of the admin stuff be done online?)
BUSSQ is a super fund focused on service and being there for our members when they need it. If you need help making a decision around your super fund or just want to talk it through, call us on 1800 692 877.
