In this guide
By the time you retire, chances are that superannuation will be your biggest store of wealth outside the family home. Yet we tend to spend more time researching the best mobile phone plan or our next holiday than we do on our super.
So even if you find superannuation mind-numbingly dull and difficult to understand, it matters. And when something really matters, it’s worth a few moments of your time.
Not convinced? Here’s why.
Tucked away in the Product Disclosure Statement (PDS) of every super fund is a warning that they are legally required to include.
Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns.
For example, total annual fees and costs of 2% of your account balance rather than 1% could reduce your financial return by up to 20% over a 30-year period.
Real consequences
It may sound like a general statement that’s easy to skip over, but it has real consequences for your retirement savings. Say you paid 2% in fees over 30 years and ended up with a retirement balance of $400,000. If you had paid 1% in fees you could have had $500,000. That’s a $100,000 difference!
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