For years, Patrick thought paying $5 a month in super admin fees on four accounts – or $20 – wasn’t worth worrying about. Consolidating his super into one account when all he’d be saving was the same as about four cups of coffee a month seemed unnecessary.
Audrey, on the other hand, kept to one super fund and paid $5 a month in admin fees in total.
10 years ago |
Patrick |
Audrey |
|---|---|---|
| Funds | 4 | 1 |
Super Balance Fees^ |
$180,689 $480 |
$180,689 $160 |
^ Annual administration and insurance fees
Today |
||
|---|---|---|
| Super balance before fees | $323,258 | $323,258 |
| Fees (Incl. lost compound earning) | $32,652 | $24,662 |
| Final balance | $290,606 | $298,596 |
Before you consider consolidating your super, weigh up the benefits and features of your other super funds against your chosen super account and compare the fees of your fund(s). Don’t forget your insurance and make sure that your chosen super will provide you with the appropriate cover to replace any cancellation of insurance cover that will occur by consolidating your account(s). In addition, if you made personal contributions and intend to claim a tax deduction, ensure the 'Notice of intent to claim or vary a deduction for personal super contributions' is received and actioned by the existing super fund before you consolidate your accounts.
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Important information
The examples above are for illustrative purposes only and are not an estimate or guarantee of your account. Neither Kaiden nor Jen is an actual customer of MLC.
ASFA superannuation account balances by age and gender Oct 2017. Table 1: Average superannuation balances by age and gender, 2015-16.
The example assumes both Kaiden and Jen’s current age is 60 with no regular income; they’re looking to retire at 70. Their starting super balance is $214,897 and they both pay $60 p.a. in administration fees. Jen has a balanced investment option while Kaiden has a cash investment option. Investment return for Jen is 4.8% and Kaiden’s investment return is 2.7%. The tax on earnings for Jen is 6.5% while for Kaiden it’s 15%. Investment fees for Jen are 0.5% and for Kaiden are 0.05%. Both Jen and Kaiden pay $100 in insurance fees. For both Jen and Kaiden, the CPI is 2% and the cost of living rise is 0%. Investment options and returns assumptions are based on ASIC’s MoneySmart Superannuation calculator. https://www.moneysmart.gov.au/tools-and-resources/calculators-and-apps/superannuation-calculator
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