The Dangers of Multiple Super Funds


How to decide what fund to use when you’re changing jobs or have more than one fund.


Getting a new job is an exciting milestone in life — it’s a huge step towards your future! Thinking about retirement is probably the last thing on your mind during the excitement of a new employment opportunity. Still, it’s essential to think about your superannuation. There are many changes involved in getting a new job, but that doesn’t mean your superannuation needs to change.


We take you through your options for when you start a new job or find you have multiple super funds.


Review your employers default superannuation


If you don’t nominate where you’d like your employer superannuation guarantee (SG) to be paid, your employer will open a super account on your behalf with their nominated fund.


Before you begin any work at your new job, it’s a good idea to find out about their nominated fund so you can make an educated decision about where you’d like your super invested.


While past performance isn’t an indicator of future performance, be sure to compare fees and performance with your current fund. If your employment gives you access to a corporate plan, you can take advantage of discounted insurance and lower fees.


Give your new employer your superannuation details


If you’re happy with your existing super, you’ll just need to give your details to your employer so they can pay your SG there. Many employers will ask this question and possibly provide you with paperwork to nominate a fund. If not, get onto your super fund and they may have a generic letter for you to give to your employer.


The dangers of having multiple super funds


According to the ATO, as of 30 June 2020, 12 million people held one super account, while 4 million had two accounts. There are costs associated with each super fund, so when you hold more than one, you’re paying additional fees and charges. This means that you open yourself up to paying multiple administration fees, investment management fees, performance fees, and investment switching fees. Not to mention, if you have insurance through both, your money will be wasted on premiums for a policy that won’t pay out because you already have cover.


Consolidating your super


If you’ve ended up with multiple super funds and would rather have your money in the one place, consolidating your super might be for you. It’s simple to consolidate your super and can be done entirely online through MyGov.


Benefits of consolidating super

  • Reduce the amount of fees you pay — paying fees in one will be cheaper than paying fees in multiple funds.

  • Manage your money in the one place — it’s easier to get a feel for the performance of your super when the money is all in one place.

  • Saves you time — it’s convenient and time-saving when you only need to check up on one fund.


Before consolidating or changing super, be sure to check your insurance coverage with your existing fund. By changing funds you may be forfeiting any cover you have in place. Getting a comparable cover may be difficult with your new fund depending on your age or medical history. Also, if you’re rolling super out of a corporate plan, you may lose access to attractive benefits.


If you need any help with your superannuation, be sure to get in touch so we can help you make the best decision.


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