Who’s got your money?

If you were asked what bank you are with? I expect you could give the banks Name, Address and you might even name the manager. If asked how much money was in your bank right now, I expect you could give a reasonable estimate.
Surprisingly, asked the same questions about Superannuation, most people get a little vague. They often can’t name the fund; don’t know their balance; don’t know who manages the fund; and don’t know what the money is invested in. Yet typically, the balance of superannuation accounts would be more significant.
After years in practice I can see there are 2 main reasons that we don’t take greater interest in our superannuation. Firstly, the money is mostly tied up until we retire. When you’re in your 20’s it’s as long as 45 Years. What good is that to you when you are looking for your first home or planning an around the world holiday? Secondly, those statements that arrive in the mail, do nothing to help you be interested in super. Terms like “Preserved”, “Taxed”, “Untaxed”, “Restricted”, “Concessional” are legally required, but not helpful. Then there is the industry jargon that can have meanings defined only in the back of thick product disclosure statements. Terms like “Capital Secure”, “Growth” and “Balance” will have different meanings for each fund. It’s enough to make most of us drop the annual super statements into a file and forget them..
If there is one gem of information that I have learned over 30 years working in finance and accounting, it is this, “the difference between success and failure is often just 1%, and if you don’t manage your money someone else will take that 1% off you”. The compounding effect of that 1 or 2 % over the life of your superannuation, can make a significant difference to your closing balance.
When was the last time a bank rang you to say that you should change to a different account? One that had less fees or higher interest. Don’t expect your superfund manager to call you up to tell you that the product you’re in is out of date and that the management fees are too high, because when you signed up for your policy 20 years ago, the policy had a 4% commission paid to the advisor.
There are ways to take control of your super. Having lots of different funds can mean higher fees and multiple life insurance policies eating away at your balance. There are super products in the market that are low cost and make it simple to manage. Self-managed Superannuation Funds are becoming increasingly popular for people who want to take full control and invest in assets like rental properties. Before you make any decisions, you should take some time to understand the options that you have and seek professional advice.