Regardless of whether you’re a casual or full time worker, the last thing you want is to have your well-earnt superannuation disappearing as a result of account fees and default insurance. This is exactly what happened to Australian child actor Elijah Perris whose entire balance had essentially disappeared in less than a year.
While super fees are unavoidable, there are a few ways to ensure you keep as much of your super as possible. This is particularly important for people who have a low superannuation balance and high fees.
- Read the PDS
The PDS is the Product Disclosure Statement that each super provider is obligated to provide you. It includes all information regarding the fund including features, fees, benefits and risks. While this may sometimes be a large document, it is beneficial to read the PDS to avoid unexpected fees or disappearing balances.
- Compare Supers
Comparing different superannuation funds is extremely important as different providers may be more suitable for particular jobs or workers. Important things to compare are the fees that will be charged, the investment rate, and any default insurance payments. Some banks offer a free initial consultation to help customers plan the best ways to grow their super and maintain their finances.
- Opt Out
Most super providers will offer various insurance covers along with their products. Common covers include income protection cover, total and permanent disability cover, and death cover. Providers will sometimes add these covers by default and thus, you must opt-out of the cover and its associated fees, if you do not believe you need it. It is usually also possible to decrease or increase the default insurance in accordance with your situation, however a level of life insurance should always be provided and maintained for worst case scenarios
- Merge Supers
It is very common, especially when you are just breaking into the workforce, to accumulate a number of different supers from various employers that you may have worked casually or part-time for. What many supers fail to notify their customers is that account fees will continue to be deducted from the super balance even after you stop working for your employer, meaning that you could be losing hard-earnt superannuation that could make a significant difference in your retirement. To avoid multiple fees, merge all your various super accounts from different providers into one. Providers are generally willing to help you combine your accounts if you are choosing to invest your super with them. Some banks are also able to advise and guide you in relation to combining supers.
Superannuation can be difficult to understand and while it may not appear to be relevant to you right now, it is important and beneficial for your retirement. Luckily for Elijah Perris, a complaint submitted by his mother was able to successfully recover the money that was deducted for income protection insurance which Elijah did not need. Elijah also had a relatively low super balance which may have affected the provider’s decision.
If you have any queries or issues regarding your superannuation, please do not hesitate to contact us on 8917 8700 or fill out the enquiry box and we will get back to you ASAP.