According to the ATO, 43 percent of Australians aged between 51 and 65 have more than one super fund – meaning they’re paying more than one set of fees at a time when saving money for retirement should be of utmost importance.
What is perhaps more staggering, is that among this same age group there are 286,000 unclaimed, lost or inactive super accounts totaling $4.23 billion. That’s a lot of money to be going begging.
It may seem unthinkable to lose track of a super account holding your savings, but it’s very common, especially among those who have had an interrupted work pattern, worked several jobs or worked in casual employment. If an employer pays your super infrequently, or pays into a default account without your awareness, then keeping track of money is obviously quite tricky.
So what exactly is lost, inactive or unclaimed super? A super account can be classified as lost or inactive for various reasons, but the most common is the fund cannot contact the account holder, or no contributions have been made into the account for a defined period of time. If your account meets further conditions, for example, you’re over 65 years old, or your balance is considered small, then your money could be transferred to the ATO as unclaimed.
If your account is marked as lost or inactive, your money stays with the super fund, where it continues to be invested, and have fees deducted from the balance, but once it becomes unclaimed super it is transferred to the ATO where interest will be applied equal to CPI. The good news is that whether it’s lost, inactive or unclaimed, this money is still yours. While tracking it down could take a bit of time and effort, it’s worthwhile being tenacious, because having your super all in one place has real benefits for your super long term.
You can do a quick search for lost super, or money that’s being held by the ATO, online using the ATO’s Super Seeker tool or through your primary super fund. You’ll be asked to provide your tax file number, name and date of birth.
You can also access details of any super funds that have been opened in your name, via the ATO section of your MyGov account.
If you fail to find super that you believe you have, you should contact the ATO directly. You will be asked to give more detailed information, such as periods of employment, employer name and contact details, so it’s worthwhile having as much information as possible to hand.
Once you have located all your super funds, you may wish to consider consolidating into one fund to limit the amount of fees you pay, and to make it easier to keep track of your savings. It is worth noting, however, that some funds will charge an exit fee so this should be considered before making the switch. It’s also worthwhile checking your insurance cover before rolling over funds to ensure you will maintain an adequate level of cover.
This article has been sponsored by AustralianSuper Pty Ltd ABN 94 006 457 987, AFSL 233788, the Trustee of AustralianSuper ABN 65 714 394 898. The views expressed are those of YourLifeChoices and not necessarily the views of AustralianSuper. The article contains general information and you should consider if it is right for you.