Five tips for selecting a super fund

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Superannuation is a savings and investment vehicle with the objective of providing funds for your retirement years. It is something most Australians have these days and is an important component in providing a comfortable lifestyle in retirement. Despite this, it tends to not be at the forefront of our minds, probably because it is a life-long investment and we tend to think about the ‘shorter term’.

It is important to review your financial situation regularly and reviewing your superannuation should be an essential part. To ensure your existing fund is appropriate or if you decide to choose another fund to better suit your objectives, there are five handy tips you should consider.

  1. Determine how actively involved you want to be with the management of your superannuation, and if you want to use managed investments through a fund manager or direct investments which you control. If you don’t want to make any decisions about your superannuation fund ensure your employer offers a ‘MySuper’ default fund.
  2. Consider your current situation including your age, your financial situation, your investment time horizon, future needs and objectives, and determine what you wish to achieve with superannuation. For example if nearing retirement, will you need to withdraw your benefit as a lump sum or will you convert the benefit to an income stream? Look at your existing and prospective fund’s asset allocations to see if they match your time frame, future needs and objectives, as well as your risk profile.
  3. Compare the features and benefits the funds offer. Features and benefits can vary between funds so consider what you may require – such as free switching, multiple asset allocation options, online access/control, personal insurance and the availability of income streams from the fund. Don’t choose a fund just because someone you know uses it and it works for them. Everyone’s circumstances are different so only consider your own situation.
  4. Compare the funds overall performance against other similar funds. The performance is effectively the (net) return of the fund and takes into account the fees or costs of running the fund as well as the returns. Set your performance expectations to take into account the fund’s limitations and asset allocation.
  5. Always ensure that your insurance requirements are met and that you can nominate beneficiaries and reversionary beneficiaries, if and when applicable.

For most Australians, superannuation is a key element to providing for retirement and is one of the most important investments we have. Just like making any life or investment decision, you should consider all the relevant aspects and seek professional advice when applicable.

If you require further information on retirement investments and investment in retirement please contact NICRI toll free on 1800 020110, email [email protected] or write to PO Box 1339, Fyshwick ACT 2609. NICRI information leaflets are also available on our websites © or //

Written by craigha


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