Superannuation. Boring. We get it.
But humour us for a second – we have already shown that not swapping funds can cost you $500,000 from fees alone. Now we want to show you that avoiding these high fees is much easier than expected. You can have your super in a new fund in under a week.
To rollover your super into a new fund you will need to consider the benefits and drawbacks of the new fund vs. your old one. This process will ensure you know what you will gain from the new super fund and lose from the current super fund
- Compare your options – make sure you have a good understanding of the performance + fees of both funds. Keep in mind that past performance is no indicator of future performance – this makes fees all the more important.
- Insurance – if you have insurance with your current super fund then you need to decide either to make a partial account transfer to keep the insurance or fully transfer and close down the insurance. Before fully closing down your existing fund, you should make sure you can get similar cover in the new fund.
- Exit Fees – beware of exit fees from your existing fund – they generally are not too onerous but are still worth knowing about.
Have your documents ready will give yourself a good start. For personal document you only need to provide;
- Tax file Number (TFN) – without TFN you will be taxed at the highest marginal tax rate
- Details of your old fund – this includes the funds ABN or Unique Super Identified (USI) this can be found on your statement or by simply calling the superannuation fund.
- Member details of the previous super fund. This can also be found on your statement or by simply calling the superannuation fund.
So how do you actually transfer your super from one fund to another – these are the 4 (rather simple) steps:
- Find where your super currently is – hint: you may have some lost super just sitting around gathering dust – use the ATO’s SuperSeeker to check
- Choose a new super fund
- Fill a rollover form – there are 3 ways of doing this
- Australian Taxation Office (ATO): this method will only allow you to fully rollover your super; you can register online then send it to your current super fund.
- Visit your super fund branch or website and request a rollover form. Through this form you can rollover all or part of your super.
- You can go directly to a new super fund and ask them to organise the transfer for you
- Once it’s processed (up to 3 days), the fund will be electronically transferred to your new super fund (up to 3 days). You will receive a Rollover Benefits Statement (RBS) showing rollover details and a confirmed request receipt. Then you’re done!
Don’t forget to tell your employee to put all future super payable into the new fund!
A super rollover can have some great benefits:
- The more funds you have the more fees you have to pay. By rolling over all your super to one account you can save unnecessary administration fees
- Lower fees means higher growth – the effects of compounding interest on these lower fees are substantial
- Administration becomes a lot easier as you can keep track of your fund and regularly check on your financial health
- Consolidated super funds allow you to take a more focused approach on your investments.
At Plenty we can give you great advice on the where, what and how of your superannuation; sign up now and receive your free financial plan.
The information contained on this page is of a general nature and may not be appropriate for your personal circumstances. You should obtain personal financial advice before acting on this information.