How to choose your superannuation fund? A guide
The first time you start contributing towards your superannuation fund you are likely to have many questions. Not least of them will be, what options do I have. If you know anything about funds you will know that they don’t all perform in the same way. Having the right to choose what kind of fund to choose will determine the profit, accessibility and efficiency of your superannuation fund.
The first question you need to ask yourself is:
Am I eligible to choose a super fund?
The answer will be yes if:
1) Your specific super is paid under a federal award called ‘notional agreement preserving state award’.
2) Your employment is under another award that doesn’t need super support or,
3) You are not employed under any other award or agreement.
As you can see the chances are that you qualify to choose your super fund if you are contributing towards it. It is probably more useful to ask when you are not able to choose your super fund.
The answer to that question is when you are paid under a state award or some other kind of worker agreement, or you have reached a particular level of benefit in a certain super fund. Some civil servants (federal and state public sector) are excluded from the choice of superannuation.
If you are able to chose your superannuation, what comes next?
If you are eligible to choose a superannuation fund your employer will or rather should give you a Standard choice form (NAT 13080) before 28 days of when you begin work.
This form will give you two main options:
1) Stay with the fund your worker is using or
2) Choose for yourself.
If you choose yourself you will have the option of investing your superannuation into lower or higher risk funds. Higher risk funds can produce higher profits but are obviously also much more likely to drop in value.
As usually is the case with financial matters your best weapon is information. This website has ample resources on understanding and choosing your superannuation fund. You can also visit www.fido.gov.au , the Australian Securities and Investment Commission website or call 1300 300 630. Your personal research and the advice of experts will help you make the best choice of superannuation fund for your personal circumstances.
However the truth is that you don’t have to choose a specific superannuation fund if you don’t wish to. If you take not specific action your employer will deposit your contributions into the fund of his choice. If you are just starting to pay towards your superannuation fund you can stick with your employers fund and choose to change later.
What is important is that you get the choice to choose your superannuation fund; it is your right as a worker. So what should you do if you are not given the choice? Your first step should be to ask for a Standard choice form. If you are denied one you can call 13 10 20 and inform the Tax Office.