The banking royal commission has revealed some shocking practices by many superannuation funds, and the ensuing revelations may have you thinking about changing your superannuation fund, but how do you go about it?
Super comparison websites can be useful to help you compare super funds, but how do you know what to believe?
Super comparison websites rate different super funds, but you shouldn’t choose your super fund on the website rating alone. You need to make sure you select the fund that works best for you and your retirement situation. ASIC’s MoneySmart website has some good advice to help you choose what you need from a super fund.
Some of the superannuation comparison sites you can choose from are:
All these websites have some information for free, but some also offer more detailed information for a fee.
Each super comparison website has different views on the best way to rate super funds. For example, some place the highest importance on fees. Others may prioritise investment performance and strategies.
Before choosing a superannuation comparison site you will have to decide on what you consider the most important factor in performance and then read the explanation of the website’s scoring system to check whether it aligns with your values.
No comparison service or fund deducts fixed dollar administration or member fees (e.g. $50 per year) from reported investment returns. This is because their impact depends on the balance in your super account. A $50 per year member fee is 0.5 per cent of a $10,000 super account, but just 0.05 per cent of a $100,000 account.
The golden rule is to do your homework when choosing a super fund and that you don’t rely solely on super comparison websites.
Have you ever switched super funds? How did you decide? What advice would you offer others?
Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.