Since the introduction of SuperChoice in July 2005, Australian workers have had the option to choose where to put their super. Now you have the freedom to choose what to do with your superannuation but are you really taking advantage of this freedom? When you started your current job, it’s likely that you just ticked a box and chose an investment option for your super. But how closely did you look at your options? Is the option you ticked really suitable for you?

Superannuation – Your Second Largest Lifetime Asset

Most of us don’t give our superannuation much consideration. You don’t really notice the money going in and for most people there is no way of accessing it until you’re retired or preparing to retire (for more information on Transition to Retirement, click to download our free TTR Ebook). But the fact is that your superannuation is likely to be the second biggest asset you accumulate in your lifetime (second to the family home), and the decisions you make now will make a big difference to where you’ll end up later. Thinking about your super when you’re retiring is usually too late, you need to be making the right decisions now.

Choosing a super fund

If you’re starting a new job, it’s very important that you take the time to choose a super fund that’s the right fit for your situation. It’s very tempting to just accept the default super fund offered by your employer, but you risk lower returns and higher fees. Also, it’s likely that you’ve still got a fund that you had from your last job— do you really want to have two super funds? It is easy to lose track when you have more than one fund. (To track down missing super, try the Find My Super website).

Super Fund Consideration #1 – Fees

The first thing to consider when trying to choose a super fund are fees. How much is too much? If you only have a small account balance, paying less fees will be more important than making good returns. But as your super balance grows, you’ll want to start looking at where you’re investing your money for greater returns. But will your current superannuation fund allow you to have the level of control over your money that you want? Do you need more flexibility? Flexibility gives you choice and control, but it also comes at a cost.

Super Fund Consideration #2 – Investment Options

The added complexity about choosing a super fund is that once you’ve decided on one, you then need to elect your investment options within that fund (provided you have the flexibility in that fund to do so). Should you invest into high growth or balanced? Should you have more or less Australian shares? What about international exposure? There are some standard options that many investment managers tend to suggest on where to invest your super, but ultimately you need something that is just right for you and suits your needs. Of the thousands of options out there, there is at least one right option waiting for you.

Get professional superannuation advice from a financial planner

Take full advantage of SuperChoice by getting professional financial advice to help you make the most of your superannuation. Making the right decisions now can make a huge difference to your super balance when you retire.

Contact Financial Spectrum today on 1300 886 018. Our Sydney financial planners look forward to helping you make the most of your superannuation.

Share

Tags: , ,