If there is more than one active fund, there are rules to select the most appropriate fund, for example, the fund with the biggest balance. If you have more than one super fund, you will be automatically stapled to the fund that has been actively receiving contributions most recently. "Research shows that the difference in outcomes between a top product and an underperforming one can amount to hundreds of thousands of dollars over a working life," says Cole. Super fund members need to ensure that they are in a high performing super fund, according to Margaret Cole, executive board member of APRA. That is less than 7% or only 4.2% ($2.2 billion) of the assets in the dud funds. According to APRA, only 68,000 of the one million accounts were moved from the poor funds. Thirteen superannuation funds out of 76 MySuper funds failed the first annual performance test of MySuper products by the superannuation regulator, the Australian Prudential Regulation Authority (APRA), released at the end of August.Īs a result the dud funds were forced to write to members to notify them that their fund was officially underperforming in September and they should move to a better performing fund. Only a small number of members move out of dud funds. Or check out Money's super comparison tool. The Your Super Comparison Tool from the tax office shows you the funds which consistently perform well over the long term and the fees they charge. While the tax office has tested the MySuper funds, half of all super funds have not been tested, which includes some of the worst-performing products with the highest fees. You could be tied to a stapled dud fund that hasn't even been tested by the tax office. If you don't change from a dud fund, what happens? Employees only have to notify their employer of the details of their new super fund. When they do, their new fund will become their stapled fund. Employees can always change funds if they wish. What's worse, as well as dud MySuper funds, you could be in a woeful super fund that isn't a MySuper fund reviewed by the regulators. This could cost you as much as $230,000 at retirement, according to research by Industry Super Australia, as even small changes in investment returns can add up to significantly more money at retirement. One million Australians are currently in a super fund that failed the tax office's MySuper fund performance test.Ī dud super fund typically charges high fees and delivers below-average returns over the long term. It can be if you are tied to a poor fund for life. Having more than one super account can be costly for employees, as it can mean they are paying multiple sets of fees and insurance premiums. The new rule aims to cut the chance of workers accumulating multiple super accounts after moving from one job to another.
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