How's your Super!

G’day,

Super! (annuation) is a topic that, if you’re like me, causes your brain to hurt and blood to boil. (Why the hell can the Government tax Super payments as they go in, AND as they go out!? And so on…) Sadly the whole topic can get very complicated, and very boring, and people tend to just tune out and ignore it (as I have done), even though ultimately Super really is important!

I am NOT an expert on Super. But I thought I’d start this conversation, having spent the past few weeks trying to get a grip on my own Super! situation, and maybe we can share our own nuggets of experience.

Why does Super matter? The idea of Super is that it will ultimately allow the Government to cut the Aged Pension. In other words - it’s what you are going to be living on when you’re old, so you hopefully don’t have to chow down on Chum - you can use your Super to afford Pal instead.

The problem is, if your Super becomes splintered into multiple Super funds as you change jobs, it doesn’t work as effectively as it should. Each fund you have will be taking fees out of your retirement on a regular basis, and that hurts double, because you are also losing potential interest/returns.

(I’ll actually ask at this point if anyone can answer this Q - If I have multiple funds, and I’m paying life insurance premiums on all of them, and I die… Is my wife going to become super rich, with payouts from each fund? I’ve always assumed the answer is yes, because ultimately it’s an insurance policy, with premiums being paid, which are not related to the fact you have other such policies… in which case… my wife really can’t know what I’m worth dead…!)

After a couple decades working, and in some cases not being able to use the Super fund that I requested when starting a new role, and in other times just dastardly laziness, I knew I probably had at least 1 “lost” Super account (ie I had no idea which Super fund my money was with), alongside the 3 that I knew I did have. A couple years ago I actually spent an afternoon using the ATO’s lost Super finder (which I see has now become part of MyGov… sigh…), and then calling each Super fund to find out my balances, fees being charged, entitlements, account numbers, etc.

One aim with this was to try get an idea of which fund/s were performing the best, to better choose which fund I should put all my eggs into. (Or, perhaps 2 big baskets is the way to go…?)

Time passed… and nothing happened… because there was this thing you had to do to make all your Supers join up - PAPERWORK! Or at least - you used to! Well, you still do, but these days - at least in the case of QSuper, you can just use their easy online form to enter the other Super fund name/s, and your account details, and they will then arrange the rolling. Easy!

So I did join the smaller ones into QSuper (based on that fund’s good returns/low fees)… except, almost half my Super remains with another fund - yes, I’ll name them - CBA. QSuper had a little disclaimer that you should really get advice first before rolling funds, in case there are any fees that your other funds may charge /etc. Upon asking CBA about this, I received a cryptic response that is going to require further investigation… For now as such - I have at least whittled my funds down to only 2!

Now my next question / research… I just noticed (cos of course, previously I’ve not cared) that my current employer recently paid 6 months Super in 1 go… According to the ATO website, your employer is meant to pay employee’s Super into their funds AT LEAST every quarter. (Otherwise - they are sitting on YOUR money, which could otherwise be earning you interest/etc.) I’m going to have to check my statements to see if this has happened the whole time I’ve been working there…

Cheers

cosmic

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I have one lost one. Which ticked me off because they apparently couldnt find me in spite of sending statements every year. The Tax office has it now. Its not much. It was just a min amount gained via tutoring at Uni and I only did that for 3 years. I should probably chase it.

As for super, I was already working part time because my health had deteriorated to that point, and I was paying off a house at the same time, so I didnt have much to sacrifice into super… so I didnt. When I finally had enough in super to pay the house off (well after I ought to have left because of health issues) I did that, and went on disability for a couple of years and then was pronounced cured when I reached 65. Age pension is livable but not easy when you have no other source of income. I manage.

I’d recommend sacrificing as much as you can afford into your super but for heavens sake find a fund that will give you a good return, and then consolidate to that. Your employer has to send the money to the fund you want, not the one thats standard for them. You can do better by doing that (or maybe not, perhaps your super fund is good, in which case bring everything else into it). If you have lots of time before retirement, do it. If not… i dunno what to recommend. Seems to me that no matter how much you have, the goverment will take from it and you’ll have less anyway. It gives me a headache as well. Do you just get an annuity, or do you do the annuity and draw down on it as well… no idea. I think the choice I made (which wasnt really a choice, I guess) was the easiest. Dont have to think about where the money will go because I havent got any. LOL.

Yes… I’m going through the mess that is our current superannuation regulations at the moment.

I sold my share of the bus business I’ve been working in for the past 32 years which gave me enough to pay out the money remaining on the house loan and then retire on.

But the max I could put into my superannuation without punitive taxation was $300,000 (on top of the money that was already there and to even do that I had to bring forward three years of contributions so I can’t put anything else in until 4 years from now.

I had money left and I wasn’t comfortable just leaving it in the bank because I know I’d be tempted to buy shiny things so I bought an investment property on the south edge of Bendigo which will be rented out and I’ll get a payment from the Real Estate agent monthly for that (rent less fees).

And I converted my superannuation from investment phase to a choice account (which on the default settings) pays me 6% of my super balance per year disbursed fortnightly.

All up that will leave me above the comfortable retirement level and I own the house so I’m not complaining about that but the paperwork needed and lack of clear information about the whole process was annoying to say the least.

And the government shifting the goal posts every year means that a lot of websites claiming to have information are actually out of date.

But on the plus side… I’m retired now WooHoo :smile:

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Super is something that is annoying to track. It’s getting better, but a few years ago it was dodgy. I had two funds with one super (AMP) because my previous employer, who were not the brightest signed me up for a new account by accident randomly. I think they put a wrong account number down and because it was the super fund of choice for the company they just signed me up under the new account. I mean crazy. Same name same TFN, how can you not track that?

To make it more frustrating one of the accounts was reported to the ATO as having a $0 balance. When I rolled over to my current fund (an industry super fund) they actually recovered the money, I was worried because they reported a $0 balance to the ATO so who knows what they’re pulling.

I’m thinking about salary sacrificing some extra super - because if I ever get to retire, ha ha ha, the pension probably won’t exist. Being made redundant hasn’t helped things but things are back on track now.

Did you know about this CGT exemption for small business and getting larger after tax contributions into super. Might not be applicable in your own situtation but a good adviser/accountant would have looked at this.

Yes but the family business (which is in a pty. ltd. company structure) has a turnover of more than $2 million per year (only just) so it’s not eligible for the small business CGT concession.

The sale price was (also only slightly) in excess of the 6 million dollar asset limit so it failed the test there as well (although given I only held 1/3rd of the company shares and there was 4 million dollars in asset finance to pay out I’m not sure that would stop eligibility).

Either way the turnover makes it not an option.

My dad would say to buy shares and/or property over putting additional funds into Super… but it all depends on your own abilities. And - he lost over $100k on his share portfolio during the GFC…

And thats a good place to be if your Super has been good to you. Mine got my house paid for and I am now in receipt of a full Age Pension because I have no other income. Oh well. I do alright.

Yes. As long as you meet the minimum balance requirements and stuff.

Make sure you have a binding nomination with every fund, your will doesn’t define where the money goes.
"If you don’t nominate someone, the super fund trustee will decide who your money goes to. This can lead to delays and may cause fights in your family."
See https://www.moneysmart.gov.au/superannuation-and-retirement/how-super-works/insurance-through-super/super-death-benefits

[quote=“ibarnett, post:10, topic:3602”]
Make sure you have a binding nomination with every fund, your will doesn’t define where the money goes.[/quote]

NB a binding nomination will devolve into a non-binding nomination after 3 years with Australian Superannuation (and I assume similar time constraints exist with other funds).

Yes, good point, need to keep updating.

Cosmic, employers must pay Superannuation Guarantee Contributions by 28 days after the end of each fiscal quarter. ie 28 April, July, October and January.
As many employers use their default fund provider as a clearance house, to get the employees contributions paid into a myriad of different funds, (a service provided as part of the deal to become the default employer fund) it can take an extra week after the 28th for the money to actually land in your account.

Hello again,

I have revived this thread because, having just done my taxes via the MyGov / ATO site, I discovered that you can very simply now bring your numerous Super! accounts together!

Following the changes to Super! insurances that have come into affect this FinYear (which stops Super!annuation companies from dipping into your account balance to cover their insurance premiums if you have not made a contribution to the account in the past 16 months), I was looking at merging my 2 accounts into one (having previously whittled 4 or 5 into those 2.)

I had visited both company’s websites recently hoping this would be a simple log-in and do it approach, but that was not the case.

Then, whilst mucking around on the MyGov site due to those pesky yearly taxes, I saw the Super! tab, and had a squizzy. Low and behold - they had a list of my Super! accounts, balances, and the easy option to merge one into another. Problem solved.

As such - if you have multiple Super! accounts - it’s well worth considering doing the same.
(Fineprint: I am not an expert in these matters; seek professional advice (like - on another online forum cos they are full of great and conflicting advice :slight_smile: ) if you aren’t entirely sure what’s best for your circumstances; but in reality merging Super! generally makes a lot of sense.)

The reason I had kept 2 Super! accounts was the knowledge that if something happened to me, my family would receive 2 payouts because both had life/perm. disability / income protection policies. Yes, it’s probably a better idea to just go talk to a dedicated insurance company and take out 1 policy set to a desired amount of cover rather than relying on 2 “off the shelf” policies provided by your Super!, but the later option was the path of least resistance, and sometimes that’s the only path I can find.

Sadly for many Australians, this new law will remove the safety-net that Super! policies offered in the event of long-term unemployment followed by injury/death etc. Ultimately however, the premiums were eating away at so many people’s small Super! balances, the end result will hopefully be better for the majority of people.

Why do you put an ! after Super?

Doesn’t everybody think that Super! deserves an exclamation mark?

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