Australians are being urged to keep a close eye on their superannuation.
Warnings suggest that more than $1 billion in retirement savings may have already slipped through the cracks due to dodgy schemes and high-pressure tactics.
The Australian Securities and Investments Commission (ASIC) has sounded the alarm, highlighting a surge in questionable superannuation promotions.
Everyone—especially those nearing or in retirement—is advised to be on ‘red alert’.
Why now? The new financial year trap
The start of a new financial year is a popular time for Australians to review their super fund’s performance, check their balances and consider making changes.
Unfortunately, it is also prime time for promoters and scammers to pounce, using slick marketing and persuasive sales calls to lure people into switching their super into risky or outright fraudulent investments.
ASIC deputy chair Sarah Court warns these schemes are becoming increasingly sophisticated.
‘When it comes to sales calls about super switching, there are some big red flags people should be alert to—being asked to make a quick decision is one of the most obvious. Remember, a good deal won’t vanish overnight,’ she says.
The anatomy of a super scam
Unlike the classic ‘Nigerian prince’ email, these superannuation schemes can seem legitimate.
The caller may sound knowledgeable, friendly and even claim to have your best interests at heart.
They might offer to find you a better super product, track down your ‘lost super’, or provide a free ‘super health check’.
Sometimes, they’ll refer you to a so-called financial adviser to add a veneer of credibility.
But behind the friendly voice and the promises of high returns, there are often hidden commissions, complex schemes and a lack of transparency.
Even experienced investors can find it hard to spot the warning signs until it is too late.
ASIC’s red flags: What to watch for
To help you stay safe, ASIC has provided a handy checklist of red flags:
- High-pressure sales tactics: If you are being pushed to make a quick decision, take a step back. Genuine financial advice should never be rushed.
- Cold calls: Unsolicited calls about your super are a major warning sign.
- Free ‘health checks’ and prizes: Offers of free super reviews or prizes, especially via social media or online ads, are often bait for a bigger trap.
- Promises to find and consolidate ‘lost super’ for free: While this sounds helpful, you can do this yourself safely through the Australian Taxation Office (ATO).
- Unlicensed advice: If the person giving you advice isn’t licensed, walk away.
- Limited contact with a real adviser: If you are only dealing with call centre staff and not a qualified adviser, be wary.
- Poor or missing product disclosure: If you are not given clear, written information about the product, that is a red flag.
- Unrealistic returns: If it sounds too good to be true, it probably is.
How to protect your nest egg
The best defence is a healthy dose of scepticism and a willingness to ask questions.
Court recommends asking the caller what commission they are earning, who they work for and who manages the fund.
If you feel pressured or unsure, do not be afraid to hang up. Remember, you do not need to pay anyone to find or consolidate your super.
The ATO offers a free and secure service through myGov, allowing you to track down lost super and combine accounts with just a few clicks.
The importance of independent advice
If you are considering making changes to your super, seek independent, licensed financial advice. Do not rely on cold callers or flashy online ads.
A qualified adviser will take the time to understand your needs and explain your options clearly—without the hard sell.
Have you been targeted?
Your retirement savings are too important to risk. Stay vigilant, ask questions and always double-check before making any changes to your super.
Have you ever been approached about switching your super? Or perhaps you have successfully tracked down lost super through the ATO?
We would love to hear your experiences—good or bad. Sharing your story could help others avoid falling into the same trap.
Also read: Experts divided: Should Australia’s super system be scrapped?
