Su­per slack­ers risk loss

The Daily Telegraph (Sydney) - - Business Daily - SO­PHIE ELSWORTH

AUS­TRALIANS may be dud­ding them­selves out of more than $50,000 in re­tire­ment sav­ings by ig­nor­ing their su­per­an­nu­a­tion, a new study re­veals.

The re­search, by Rice Warner and the Aus­tralian In­sti­tute of Su­per­an­nu­a­tion Trustees, found work­ers could be short-chang­ing them­selves $52.5 bil­lion in the next decade.

It showed that for a sin­gle per­son on an an­nual in­come of $100,000, they would end up with $51,000 less over a work­ing life­time if they did not have their money in a fund’s de­fault MySu­per op­tion. The dif­fer­ence in re­turns is based on a 25year-old who re­tires at age 67.

The mem­ber could end up with $503,000 at re­tire­ment ver­sus $452,000 if they opted for in­vest­ment out­side of MySu­per.

MySu­per is a low-cost op­tion which ap­plies au­to­mat­i­cally to em­ploy­ees un­less they choose oth­er­wise. Al­ter­na­tives in­clude opt­ing for money to be in­vested in high-growth op­tions such as eq­ui­ties.

AIST’s chief ex­ec­u­tive of­fi­cer Eva Scheer­linck has also urged su­per fund mem­bers to check the fees they pay on their ac­count.

“Peo­ple should take half an hour ev­ery cou­ple of years to work out if the fund is right for them,” she said.

She sug­gests check­ing ad­min­is­tra­tion fees are no more than $2 a week and to be aware of as­set-based fees be­cause some funds do not charge th­ese.

Bank-owned su­per funds have copped a bat­ter­ing in the fi­nan­cial ser­vices royal com­mis­sion for un­fairly goug­ing mem­bers, charg­ing ex­ces­sive fees and poor re­turns.

Aus­tralianSu­per group ex­ec­u­tive Paul Schroder said: “not all MySu­per op­tions are the same and a poor choice could cost you dearly in the long run.”

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