7 November 2024
Whether you’re setting up a new business or employing people in your business for the first time, adding ‘choose a default super fund’ to your to-do list is a must.
What is a default super fund?
A default super fund is the fund that you choose to pay your Superannuation Guarantee (SG) contributions into for your employees who don't choose their own fund or have a stapled fund.
The role of a default super fund
Whilst having a default super fund is an employer obligation, it remains important for the following reasons:
- Onboarding new employees: When a new employee starts and does not have a stapled fund and hasn’t provided their Superannuation standard choice form (within 28 days of their start date), the employer needs a default fund to ensure that super contributions can be made by the quarterly due date. This helps avoid delays and penalties if your superannuation guarantee obligations haven’t been met on time.
- Awards and agreements: In some cases, state or industrial awards may prescribe where super must be paid. Employers must follow these rules, which may mean having a default super fund that aligns with the terms of the award or agreement.
- Simplifying admin: Having a default super fund can help simplify the administrative process for employers.
Why does your choice of default super fund matter?
The default super fund you choose, could have a significant impact on the future of your employees’ savings at retirement. Factors like different fees, investment options, performance, insurance and services are also contributing decisions. Since 1 January 2014, all default super products have to meet government standards called MySuper. MySuper rules are in place to help make sure that default super is better value for employees, and easier for businesses to compare different funds.
Benefits of a default super fund
A well-chosen default super fund can offer several benefits to both employers and employees:
Quality fund selection
Employers can select a default super fund that has a strong performance record, low fees, and a range of investment options. This ensures that employees who do not choose their own fund are still placed in a super product.
Employee education and support
AustralianSuper offers resources and support services to help employees understand their super and make informed decisions.
Streamlined processes
By having a default super fund, you could streamline your payroll and super processes, reducing administrative time and meeting super laws.
If you’d like to make AustralianSuper your default Fund, reach out below.
GET IN TOUCHThis information may be general financial advice which doesn’t take into account your personal objectives, financial situation or needs. Before making a decision about AustralianSuper, you should think about your financial requirements and refer to the relevant Product Disclosure Statement available at australiansuper.com/PDS or by calling 1300 300 273. A Target Market Determination (TMD) is a document that outlines the target market a product has been designed for. Find the TMDs at australiansuper.com/TMD.
AustralianSuper Pty Ltd, ABN 94 006 457 987, AFSL 233788, Trustee of AustralianSuper ABN 65 714 394 898.