30 August 2024
Starting a family made Magesh realise how important it is to be in a super fund with top long term performance1 that puts members first. When he discovered he had multiple accounts and was paying fees on all of them, he decided to roll his super into one fund with AustralianSuper.
Having multiple super funds means you could be paying multiple fees, as AustralianSuper member Magesh discovered. To solve this problem, he decided to consolidate his super funds, moving all his accounts to AustralianSuper.
Not all super funds are created equal. A fund’s overall performance can be measured by looking at net benefit. This is the investment returns minus administration and investment fees, and costs and taxes.
We spoke to Magesh in 2020. Watch his story now:
Rolling over super – Magesh’s story
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Show Transcript
My name is Magesh Magesh and I’m 42 years old.
I work as a instrumental music teacher. I’m married and I have 2 young boys.
I think the time I realised when super was going to be important for me was, basically when I had kids. ‘Cause it was just really important to know that I was being looked after and I’d have money when I retired.
I’ve been with AustralianSuper over 10 years and have had several jobs in that time that had their own super funds. It was really easy to make the switch to AustralianSuper, simply because I’d come from other super funds that had higher fees, but also the join up process of going online and becoming a member was quite easy.
The steps I took to improve my super balance was basically, getting all those other super funds and rolling them over to AustralianSuper and it was quite an easy process I just needed the number of the account and AustralianSuper took care of the rest.
I watch the news, so I do know what’s going on with the Royal Commission and how other super funds have essentially put the profits first and the profits going back to the shareholders and I’m confident with AustralianSuper that’s not the case because the profits are going back to the members. And that’s really important for me simply because I have a family.
If I was talking to my friends or family, I would basically say don’t feel that you’re stuck with the super fund that your job recommends. Even though it doesn’t seem like much at the time, over a career or, you know 40 years or whatever, it’s knowing with the right fund, you could be hundreds of thousands better off when you retire.
‘The steps I took to improve my super balance was getting all those other super funds and rolling them over to AustralianSuper. It was quite an easy process... AustralianSuper took care of the rest.’
Before making a decision to combine your super, consider any fees or charges that may apply, and the effect a transfer may have on benefits in your other fund such as insurance cover. We recommend you consider seeking financial advice.
Multiple super accounts
Having multiple accounts is a common issue. In fact, as at 30 June 2023, around 4 million Australians held two or more super accounts2.
If you have several accounts and want to rollover your super, you can do as Magesh did. Contact AustralianSuper and we’ll help you.
3 things to look out for when comparing super funds
If you’re thinking of rolling over your super into one account and are comparing funds, there are a few things to keep an eye out for to make sure you’re comparing apples with apples.
1. Fees
Your fund will charge you fees to manage and invest your money. The amount of fees you’re charged depends on a couple of factors. These include your investment option and the type of fund you’re with, such as an industry or a retail fund. Industry super funds, such as AustralianSuper, are not-for-profit and return profits to their members. Retail funds often charge much higher fees as they have a responsibility to their shareholders and a focus on profit.
The amount of fees you pay over the course of your working life can add up. This can have a significant impact on your overall super balance come retirement.
2. Long-term performance
When you’re looking at different super funds, it can be important to compare long-term performance. After all, super is a long-term investment. So be sure to check not just how the fund is performing over the short term, but whether it has a good track record over the long-term.
3. Net benefit
Net benefit is what you get when you calculate investment performance, minus the fees, costs and taxes charged by your fund. It’s essentially a truer reflection on how your super is performing, meaning, the higher the net benefit, the more your balance grows.
READ ABOUT: NET BENEFIT AND WHY IT’S IMPORTANT TO YOUR SUPER
‘Even though it doesn’t seem like much at the time, over a career or 40 years it’s knowing with the right fund, you could be hundreds of thousands better off when you retire.’
Speak to a financial adviser
Before making a decision to combine your super, consider any fees or charges that may apply, and the effect a transfer may have on benefits in your other fund such as insurance cover. We recommend you consider seeking financial advice . If you wish to claim a tax deduction for personal super contributions, you must lodge a notice of intent to claim a tax deduction with your original fund, before you consolidate your super into another fund.
A financial adviser can help give you advice on how consolidating super might impact things such as insurance you might have.
1. AustralianSuper Balanced investment option compared to the SuperRatings Fund Crediting Rate Survey - SR50 Balanced (60–76) Index to 30 June 2024. Investment returns aren’t guaranteed. Past performance isn’t a reliable indicator of future returns.
2. Source Trend towards single accounts | Australian Taxation Office (ato.gov.au)
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The views expressed are those of the member based on their particular circumstances, reproduced with their continuing consent
This may include general financial advice which doesn’t take into account your personal objectives, financial situation or needs. Before making a decision consider if the information is right for you and read 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.