How To Switch Super Funds (In 7 Minutes Or Less)

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After more than 10 years of sticking with a super fund that consistently gets ranked as one of the worst offenders when it comes to fees, I finally did something about it. Here's how to make the switch yourself - as quickly and painlessly as possible.

Why switch now?

I'm in my mid-thirties and I work full-time. Time is NEVER on my side. If it's not urgent, then it's not going to happen.

The thing is, superannuation really is something I need to prioritise because unlike the generations before me, a liveable pension is no longer a guarantee. By 2023 you'll need to be 67-years-old to qualify, and former federal treasurer Joe Hockey unsuccessfully attempted to raise the Age Pension to 70 by 2035. So, who knows if the age will go up again before I retire.

To have a comfortable lifestyle in retirement The Association of Superannuation Funds of Australia (ASFA) says couples need $640,000 and singles $545,000 on top of the Age Pension. If that's the case, then I need all the help I can get.

But it wasn't these frightening numbers that made me switch, it was the shocked face of a colleague when I told her who my super fund was. "Do you like throwing away money?" she asked. Apparently, the answer was yes and that stung because I realised my own laziness to switch was costing me... a lot.

Picking a super fund

To avoid throwing away any more money that I could be paying off my home loan or more realistically spending at the supermarket, I jumped onto the Superannuation comparison tool at RateCity.com.au

I quickly realised there were literally dozens of funds that had much lower fees and more importantly much bigger returns over the past 5 years than my current fund.

After a quick browse, comparing fees, performance and insurance options I picked my new super fund.

Things to compare What to look out for
Fees The lower the better
Investment Options Make sure there are options that suit your needs and comfort with risk
Extra Benefits Your employer may pay more than 9.5% for certain super funds or if you make extra contributions yourself
Performance Pick a fund that has performed well over the last 5 years - do not chase last year's best performer
Insurance See what cover is available and what it will cost
Service Call the fund or browse their website to see what other services they offer

Source: ASIC

Applying online

Seven minutes, that what it took for me from start to finish to sign up to a new super fund online.

This included faffing around looking for my tax file number and my employers ABN. The online form took me less time to fill in than it takes me to use the self-service menu system at McDonald's to order for my family.

Once I was done my new super fund even included a printable form to give my employer with my new super account details.

Done and dusted in 7 minutes.

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Comments

    Wait until after 1 July 2019. After that date they cant charge you fee's for transferring to another fund.
    It was a new feature of the Budget...

    It sounds like signing up to a new fund isn't too tricky, but how hard is it to transfer your savings out of the old fund and into the new one?

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