Having more than one inactive superannuation account may be costing you thousands.
rescue your lost super and save
Most of us want a comfortable lifestyle in our later years but many of us are still failing to engage with our superannuation, which we expect to pay for our retirement dreams. Only 42 per cent of Australians know their exact super balance because they either “don’t remember to check it, didn’t know how to check it, or they’re not bothered,” according to a survey of more than 2000 people conducted by comparison site finder.com.au earlier this year.
On top of this there are more than six million lost super accounts in Australia, worth around $18 billion. Lost super occurs when your super fund is unable to contact you, which means your account remains idle but annual fees will still be deducted from your balance.
About 40 per cent of Australians hold two or more super accounts according to Australian Taxation Office (ATO) statistics. If you change jobs regularly or you’ve had part-time jobs while at school or university, it’s highly likely that you have more than one super account.
Not only does this mean many people are paying multiple fees but, as the Royal Commission into nancial misconduct has highlighted, many are also paying for insurance that they don’t need and, in some cases, can’t access.
Around 2.5 million people have two or more super accounts with insurance cover, according to evidence presented to the Royal Commission in August. And according to estimates from the Productivity Commission, Australians are paying $2.6 billion extra a year because of unintended multiple accounts. That’s $1.9 billion in excess insurance premiums and $690 million in excess fees.
The retirement balance of a typical worker who held two accounts across their working life, compared with just one, would be over 6 per cent, or $51,000, worse off, according to the Productivity Commission. Younger workers, low-income workers and people with interrupted work lives are hardest hit, sometimes by as much as $125,000.
There’s no excuse for not nding lost super with several ways you can search for free, and many super funds will help you. For example Australian Super, our biggest super fund, will search for a member’s lost super if the member gives them permission to use their tax le number.
Alternatively you can use the ATO’s myGov service (mygov.gov.au) to see details of all your super accounts, including any you’ve lost track of. To do this you need to register for a login. If you don’t have a myGov account, a paper “searching for lost super” form is available for download from the ATO’s website. And you can also try AUSfund (ausfund.com.au), which looks after the lost super of millions of Australians for some of the largest super funds in Australia.