E6: It’s never too late to understand your super

Even if you don’t have too much in your super account, it’s never too late to pay attention to your super.

Justin Bott, Financial Information Service Officer with Services Australia,
says at its heart, super is a simple concept. It’s a way of saving for retirement. A percentage of your wage is put aside when you are working that you can access in your retirement usually tax free after the age of 65. The money put into your super is part of your wages, and your employer also contributes a portion of your salary as well, currently, a minimum of 9.5% It should be viewed as part of the tax structure as super is kept in a tax friendly environment as it builds up. However, you generally can’t access the funds until retirement, or the age of 65.

Justin Bott suggests familiarising yourself with your fund. Checking what your money is invested in and what the different investment options are ranging from conservative to aggressive. Check the fees, and the insurance arrangements as funds offer life insurance and other forms of insurance such as income protection for additional fees.

If you want to change funds, it’s important to check these aspects as while some funds have lower fees, their returns may also be lower. Compare funds, especially their performance over several years, not just the past year.

Check through the Tax Office using your tax file number (TFN) to see if you have more than one fund. Consolidating your funds is easy, but make sure you have researched which fund is the best for your needs. Seek financial advice if you are considering changing funds, or risks levels especially if you are close to retirement.

Women need to pay particular attention to their super as currently, they retire with less than 47% less super than men.

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