One in four Australians have this issue with super

Disengaged consumers want the Government to act on multiple super accounts.

One in four have super problem

Disengaged consumers want the Government to act on multiple super accounts, and ensure default super funds should be good quality, with low fees and a history of good performance, new polling has revealed.

The polling of 1074 Australians, commissioned by Industry Super Australia and conducted by research company UMR, shows that people with super significantly underestimate the existence of multiple accounts, with only one in seven, or 15 per cent, of those polled aware that they have more than one account.

The Productivity Commission found that 40 per cent of people have multiple super accounts, meaning that up to 25 per cent of people, or one in four Australians, with multiple super accounts may not actually be aware they have more than one.

This chronic disengagement could be why 70 per cent of those polled support the Government taking action on multiple accounts by ensuring they have just one super account – either by combining their super automatically when they change jobs (71 per cent support) or by allocating them to a single fund for life (69 per cent support).

While consumers support government intervention to stop the proliferation of multiple accounts, they are concerned about getting stuck in a poor performing fund, with 71 per cent of people agreeing that default funds should be good quality with low fees and a history of good performance.

In comparison, just 30 per cent of people polled supported a less regulated choice framework, where employers could use any fund they wanted as their default fund, regardless of how good it was.

Industry Super Australia acting chief executive Matthew Linden said these results reinforced the need for the Government to stop multiple accounts and implement reforms that enhance consumer protections, not undermine them.

“The last thing chronically disengaged consumers want to worry about is trying to consolidate old super accounts,” Mr Linden said.

“Nor do they want to get to retirement and wake up to the fact that they have lost hundreds of thousands of dollars through duplicate fees and premiums.

“These results confirm there is overwhelming support from consumers for government to step in and find a way to eliminate multiple accounts for good, so that everyone can have confidence their super is in the one place, in a high-performing fund earning good returns.”

Mr Linden said automatically consolidating or combining a person’s super every time they changed jobs into a single, quality-checked account was the only way to solve this problem.

“It will take the hassle out of super for disengaged consumers and will mean more returns and more money and security for hard-working Australians in retirement,” he said.

“Condemning a person to a single fund for life, regardless of its performance, could see people end up hundreds of thousands of dollars worse off by the time they retire if they are stuck in a dud fund.”

Mr Linden said the results reinforced the need for strong default system, with quality filters and safeguards – not complex choices without quality checks that leave people vulnerable to exploitation.

Are you worried you might have lost money from your retirement by keeping too many super accounts open?

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    COMMENTS

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    54-11
    11th Jul 2019
    11:03am
    Employers pay the super guarantee super accounts quarterly at best - why aren't employers made to pay SGC into the super fund on the same day that regular pay is paid.

    So simple.
    KSS
    11th Jul 2019
    12:33pm
    My super is paid monthly. That is not an unreasonable outcome even though we are paid fortnightly.
    Greg
    11th Jul 2019
    1:23pm
    Legally they must pay quarterly, this is done to tie it together with the BAS they do quarterly. You may think it's easy, and for large firms it could be but there's plenty of smaller businesses who are much more manual with their accounting, they do their BAS together with the super payments. This is all part of trying to keep the accounting/paperwork lower as it's very time consuming.

    11th Jul 2019
    11:40am
    I agree that something should be done about a person's choice to have their super in a fund of their choosing. For a time I was using various labour hire companies and was required to have my super component paid into the funds chosen by either the labour hire company or the company controlling the site where I worked. Add to that the default position of an insurance policy being deducted rather than the insurance being an opt-in choice and a lot of funds disappeared quickly.
    Farside
    12th Jul 2019
    10:24pm
    and when the contract finishes you rollover the balance to the fund of your choice ... easy as shooting fish in a barrel
    inextratime
    11th Jul 2019
    11:51am
    Good question 54-11. However the answer is simple. The longer they hang on to other people's entitlements the less they pay on borrowings or the more they gain in interest themselves. The amounts are ginormous but why would anyone worry about the employee ?
    inextratime
    11th Jul 2019
    11:51am
    Good question 54-11. However the answer is simple. The longer they hang on to other people's entitlements the less they pay on borrowings or the more they gain in interest themselves. The amounts are ginormous but why would anyone worry about the employee ?
    Karl Marx
    11th Jul 2019
    1:03pm
    Simple answer with a very simple solution, legislate it next sitting, can't be that difficult for the government to implement even the ALP can push it forward even an independant
    Greg
    11th Jul 2019
    1:19pm
    OlderandWiser it maybe simple for the bigger firms to pay but there's 10's of 1,000's of small businesses who pay super manually, calculate it, account for it and then pay when they do their BAS.
    Karl Marx
    11th Jul 2019
    1:57pm
    I disagree Greg, there is no reason at all why 10's of 1,000's of small businesses can't pay into the recommended super fund on a weekly or monthly basis. BAS is totally different as super does not belong to the employer or the government but belongs to the employee same as wages & salaries.
    I lost 10's of thousands of dollars that hadn't been paid by my employer into my super fund as they kept getting extensions for late payment then they went into liquidation & guess who got first bite of any assets that were sold, yep the banks, by legislated law. Employees who lost everything & nearly a years super contributions including any salary sacrificing got nothing as their was nothing left after the banks got first dibs
    Farside
    12th Jul 2019
    10:36pm
    Employer super contributions should be remitted the same day as PAYG, no ifs, no buts. These are funded and employers must understand their super contributions are not part of their business working capital, even if they have to be dragged to the party kicking and screaming. Employers should regard their contribution obligation as money held in trust and ensure it is remitted on a timely basis. Can't afford them due to cashflow or whatever, then stop employing people before the problem arises. Far too many workers are stooged by employers going bust after misappropriating employer super contributions without consequence. It's high time such behaviour was treated as the fraud and theft that it is and that starts with legislation as O&W stated above.
    Glenn
    11th Jul 2019
    11:55am
    I can't believe people don't know how many super accounts they have. It's not rocket science, just check your statements and consolidate into one - simple and needs no government intervention. You can opt out of insurance very simply and if you don't like the default fund change it by telling your employer.
    london
    11th Jul 2019
    12:10pm
    I am a single mother with an adult child.I have been contributing for super for30 years.
    If I die before i retire, what will happen with my super
    micko
    11th Jul 2019
    12:30pm
    I believe it would go to your estate.
    sunnyOz
    11th Jul 2019
    1:39pm
    londond - If you want your super to go to your child, you should have a Binding Nomination, which is a binding direction in writing from you to your super fund, to pay any death benefit to your child, or to your estate. If you decide to make a binding nomination, it is your responsibility to keep the nomination up to date. Binding death benefit nominations lapse three years from the date you make, confirm or vary your nomination. If the nomination lapses or you don’t nominate a specific person/s, it will become a non-binding nomination and go to your estate. Best to contact your super fund.
    Greg
    11th Jul 2019
    3:53pm
    sunnyOz - Binding Nominations can now go indefinitely, called "A Non-lapsing Death Benefit nomination".
    Not a Bludger
    11th Jul 2019
    12:18pm
    So 40% of the population can’t be bothered to keep track of their super fund(s) and consolidate into their preferred fund (very easily done and at no cost) from time to time.
    Just proves the old adage “a fool and his money are soon parted”.
    Mind you, anything that Industry Super Australia supports is bound to be sus so caution is obviously required.
    And re multiple funds occurring - this is mainly down to thug unions browbeating companies to pay employees super into the fund chosen by the union - no freedom of choice here.
    Karl Marx
    11th Jul 2019
    12:56pm
    still full of BS NaB. There are more thugs at the top end of town protected by your thugs Morrison, Dutton & co.
    Retail funds have proven to be greedy thieves during the RC same as banks. Only the industry funds came out clean so all your bullshit doesn't wash.
    Greg
    11th Jul 2019
    1:26pm
    Garbage - businesses will use the one super fund to make payments easier, many smaller businesses have a lot of manual calculating to do and to send payments off to multiple super funds is one more task that complicates things.
    Not a Bludger
    11th Jul 2019
    3:17pm
    Greg - absolute nonsense - you must be a civil servant with little knowledge of the real world.
    As one who set up a small then medium sized manufacturing business for some 30 years, we always paid super entitlements to the fund requested by our employees.
    Indeed, at start of employment, staff were requested to nominate the fund of their choice.
    This was little added administrative burden and and was calculated with each weekly payroll
    Had the added advantage that it was practically impossible for thug unions to knuckle either the company or employees, en masse, to pay into the union controlled fund.
    Farside
    12th Jul 2019
    10:47pm
    I have never had a union try to "knuckle me" into contributing to a union controlled fund however the last three employers I had each used a single fund. The only fund I ever lost my contributions in was one of these (AMP) and it still irks me. On the plus side, it was only around $10k and lesson learned - regularly monitor your funds performances as these can change quickly. My mother lost much of her underperforming NAB super contributions about 20 years ago and was able to settle for a little over $40k in damages after the banking royal commission for lost earnings and financial planning services not provided.
    KSS
    11th Jul 2019
    12:27pm
    Perhaps people would like the Government to wipe their noses too!

    People who have super accounts are adults (or teens who think they are adults). Being an adult means taking responsibility for yourself.Keep a track of your own supr. Find your own missing accounts and consolidate them It is not that hard.

    People whimge about a nanny state and yet they want more and more Government intrusion into their lives.
    Captain
    11th Jul 2019
    3:14pm
    KSS, I do not have much sympathy for those who are disconnected with their own money and therefore their own future. I imagine these people will complain bitterly when they retire and find that through their own incompetence they are many $'s short to support their retirement.
    Farside
    12th Jul 2019
    10:51pm
    I agree KSS, personal responsibility is an oft overlooked quality. Government should be there to provide a safety net when required without it being an intrusion into their lives.
    london
    11th Jul 2019
    12:34pm
    what happens to my super if I die before retiring
    Digby
    11th Jul 2019
    1:00pm
    Provided you have a valid will, make a binding nomination with the superannuation company (trustee) for your super to go your "legal representative" (your executor after your death). Then it will be distributed according to your will, and thus hopefully your wishes will be carried out (may vary if your will is contested). If you don't do this your super will be distributed by the trustees of the super company you are with, as they see fit.
    Karl Marx
    11th Jul 2019
    1:06pm
    Did this when I updated my will a year ago. The legal firm I used organized it all with my super fund.
    Greg
    11th Jul 2019
    1:31pm
    Even if you have no will or binding nomination the funds will be distributed as per the normal intestacy rules, obviously if you're concerned about someone claiming their right to your estate you may want to have a will or binding nomination.
    Adrianus
    13th Jul 2019
    8:13am
    Greg, superannuation does not form part of the deceased's estate. The trustees have totally separate obligations, regardless of an intestate death.
    Karl Marx
    11th Jul 2019
    1:00pm
    My guess is most super members under 45 don't really care about looking into their super as yet.
    Everyone should be able to nominate the superfund that employers pay into & pay into at the same time wages or salaries are paid & if that means the government needs to legislate that this is dine they they should get their finger out & do it next sitting
    leek
    11th Jul 2019
    1:40pm
    I am being FORCED to put my super into an account of my employers chosing. When I questioned why I could not chose, and hated being forced to enter in a new super account that I don't want I was told it was because of the company agreement that has been ratified by the fair work commission in 2010. I continually complain about this. So I go to roll over $$ from this account to my main super account, and then the Super company tells me that I am not allowed to, I have to keep $1500 in the account as there are employer contributions going into it. To say I am angry about having a super account I don't want or need and cannot not roll over is an understatement.
    Karl Marx
    11th Jul 2019
    2:03pm
    Keep complaining & transfer when possible, even ask, demand that all fees are paid for by the company.
    This is why we need legislation to force our choice because it's not the employers money i't belongs to the employee.
    Not a Bludger
    11th Jul 2019
    3:21pm
    I sympathise, leek - this is unions using their clout to control your money.
    Keep bitching and you will be able to prevail!
    Karl Marx
    11th Jul 2019
    3:30pm
    NaB how do the unions have anything to do what super fund the company is using, maybe the company insisted on this funds. Glad though that you know how the fair work commission in 2010 came to this conclusion considering the company in question wasn't even named.
    Just another LNP troll answer full of BS
    Not a Bludger
    11th Jul 2019
    3:46pm
    Geez Older and Wiser - seems like you have never been at the workplace coalface.
    The Fair Work Commission only rubber stamps EBA’s (aka Enterprise Bargaining Agreements) and does not set/order them.
    An EBA comes around after thug unions have battered an employer with strikes, walk off the jobs, pressure from other unions at the company’s suppliers, transport suppliers etc and is subsequently forced to agree to pay their employees super into the super fund controlled by the union.
    Fiction? - no - personal experience.
    Karl Marx
    11th Jul 2019
    5:29pm
    Again NaB you just prove that you are full of it. Spent many years at the coal face with thug bosses hell bent on not giving anything but making record profits and reluctant to even make work a safe place because it may cost them a few dollars in profit.
    Bet you were one of those thug bosses that used threatening behaviour & standover tactics to all employees that didn't tow your line then running to the courts & the government like a spoilt little brat because someone had the guts to stand up to your bullying.
    Aussie
    11th Jul 2019
    4:05pm
    Not a bludger is correct. An EBA can specify a super fund and employees therefore have no choice of fund. The Fair Work Act that was introduced by Labour allows for this. The union is a party to the EBA, so it is them that chooses the super fund on behalf of employees.
    Karl Marx
    11th Jul 2019
    5:32pm
    Then it's time it was changed then isn't it. read my earlier posts. NaB is just a disgruntled old employer who was a thug & bully himself.
    Adrianus
    13th Jul 2019
    12:21pm
    We need a National Superannuation Register and every Australian should have a NSR identification number which links the owner to every superannuation account membership. It's a sign of gross negligence that there is over $2B in lost super. Super should also be more easily transferable with the small cost of the paperwork born by the fund. Superannuation should be designed for the members and not for those who earn a living from the industry.