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Superannuation: Track your performance

Every Issue

Cite as: September 2012 86 (09) LIJ, p.79

There are three things you must do when your super statement arrives in the mail.

Reviewing your super statement should be as routine as checking your credit card or bank statements or lodging your tax return. It keeps you in control of your super so your retirement plans stay on track.

There are three must-dos when your super statement arrives.

First, open your statement (some people don’t even do this).

When you do, review the transactions that are listed, including:

  • the super your employer paid in for you (includes the 9 per cent superannuation guarantee payable for virtually all working Australians) and any additional amounts you may have paid in yourself;
  • fees deducted from your account including the cost of any insurance you may have;
  • government taxes deducted from your account;
  • investment returns applied to your account; and
  • your balance at the end of the year, compared to the balance the year before.

If something doesn’t seem right or make sense, call your super fund and ask them to explain.

Second, compare funds. Consider the competitiveness of your super fund with others.

Compare investment returns over the longer term.

Super is a long-term form of saving so performance comparisons should be done over five years or longer, not just one year.

Useful performance information can be found at the following websites: www.selectingsuper.com.au or www.superratings.com.au or www.chantwest.com.au.

Compare fees. According to the federal government’s consumer website moneysmart.gov.au, even just a 1 per cent difference in fees could make up to a 20 per cent difference over 30 years.

To get a sense of the level of total fees you are paying, identify the total fees on your super statement (i.e. investment fees and other management charges but excluding any fee for financial advice) and divide that by the average of your opening and closing balances. This gives you an indicative overall rate of fee, which you can compare to the fees charged by other funds.

For more information about your fund’s fees, contact your fund or refer to the fee section of your fund’s product disclosure statement, available from their website.

Third, update your super details. Ensure your super fund account details are up to date. Some items you should check are listed below.

Is your accumulated balance growing adequately to support your retirement plans? Many funds (including legalsuper) have projection calculators – see www.legalsuper.com.au/calculators/index.cfm.

By reviewing your accumulated balance and using the calculator you can get a sense of whether you need to increase your contributions. If you are thinking about contributing more, remember that contribution limits apply over which penalty tax applies.

Consider consolidating other super accounts. Multiple super fund accounts mean multiple fees and more paperwork.

Check if you have any lost super. There are still millions of lost super accounts totalling billions of dollars. Go to www.ato.gov.au/superseeker or phone 13 28 65.

Check if your insurance is adequate for your current circumstances. If your circumstances have changed (e.g. new dependents or more debt) it might be worth thinking about whether you should increase your insurance.

If you die your super will in most cases be paid to your dependants. Advise your super fund of the beneficiaries to whom you want your super paid.

Some funds offer binding nominations which bind the trustee to pay your super to the person you have nominated. If you don’t have a valid binding nomination, the trustee may pay your benefit to someone other than the beneficiaries you have nominated.

Superannuation is now the second most significant financial asset of Australians, second only to the family home. So, it’s certainly worth spending some time checking how your investment is going.

Taking a few minutes to check your annual super statement will better place you for financial security later in life. It’s well worth a look.



ANDREW PROEBSTL is chief executive of legalsuper, Australia’s largest super fund dedicated to the legal profession. He can be contacted directly on 03 9602 0101 or via aproebstl@legalsuper.com.au.

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