In this guide
Superannuation is like any long-distance journey; you want to make sure you know where you are headed and how to reach it. That includes finding a vehicle that’s fit for purpose. Otherwise, you could end up short of funds to enjoy your destination – retirement.
Whether you are choosing your first super fund, consolidating two or more funds into one, or wanting to switch to something better, it pays to invest some time in thinking about what you need in a fund and then comparing what’s on offer.
Most people these days can choose their fund unless you happen to be an employee in a defined benefit fund or covered by an older industrial agreement. If you don’t choose a fund your employer will pay your Super Guarantee (SG) contributions into your ‘stapled’ fund, which will be a fund you have chosen in the past or the default fund one of your previous employers used for you. If you don’t have a stapled fund, your employer will pay contributions to their current default. You may be lucky and end up in a high-performing fund but, unless you verify this is the case, what you don’t know could be very costly.
The following steps are designed to guide you through the process of comparing and choosing a fund that will get you where you want to go.
1. Know what you want
Before you start comparing the market for any major purchase, be it a car or a super fund, it’s important to think about what you want. Otherwise you could end up paying for expensive extras you don’t need. Or you could sign up for a product that lacks the features you do need.
It’s important to start by thinking about what kind of investment you want for your super. Without knowing which investment option to use in your comparison, you can’t begin. The last thing you want is to compare based on the default investment, realise later another option is more suited to you, and have to start over.
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