It's Never Been More Important To Care About Your Super

We’ve all got those issues and tasks we’ve gotta deal with which are basically a ‘future us problem’ - you know, things like upgrading your resumé, cleaning out your fridge or getting that gym membership.

Some of them can probably wait, but other ones really benefit from getting taken care of sooner rather than later. With that in mind, we’re here to tell you why sorting out your super is better done now rather than later.

Ethical screening is one of the easiest ways to help the environment

This is probably a bit of an oversimplification, but superannuation basically takes your contributions (made by your employer) and invests that money back into the economy, giving companies money to expand their businesses, which you get to take advantage of when you’re ready to retire (or put down a house deposit). 

Unfortunately, there are some big companies out there making serious profits on industries like weapons manufacturing, controversial industries, or being involved in fossil fuels. I don’t think we need to get into how big of a deal climate change is atm, right?

Because some people don’t want their money going to those businesses, super funds like Aware Super have given you the option to have a fund with an ethical screen - excluding companies that can be harmful to our society and planet, and putting money towards companies with a positive mission.

If you’re trying to clean up your act in your everyday life, taking a few mins out of your day to pick a more ethical fund is an easy way to keep your hard earned bucks in the right hands.

Finding a good fund now makes changing jobs a breeze

Super recently the government put in a new rule called ‘stapling’. Back in the old days, when you signed up for a new job you’d have the choice of putting in the details of a fund you’ve chosen, or you could tick a box and your employer would set up a new account with whichever provider they went with. The problem was that that led to people having a bunch of accounts, which could have all been taking fees out and cutting into their savings. 

These days, if you don’t make a choice on your forms, your boss has to look for your stapled fund, which is chosen by the ATO, and then they start contributing to it. It’s good because it prevents you from starting loads of new funds, but it means that having a good super fund (and getting rid of the other ones) is a great move, because then you don’t have to worry about which fund your contributions will end up in.

The earlier you sort out super, the more you can earn in compound interest

Say for instance you’re 20 years old, and you have a fund which has reported a return 4% annually after fees, and you’re comparing it to another one that has a reported return of 5% annually after fees.

If you earned $960 a week, and your boss put in $96 as your super contribution, after a year you’d only see about $116 bucks in returns on the 5% fund, vs $93 in the 4% fund. That doesn’t seem like much, but by the time you’ve turned 65, the 5% fund would mean you’d retire with $842,998, vs only $627,939 in the 4% fund. 

That’s why it’s important to take a look at how your super fund is performing, look at any fees you might have, or if you have multiple funds active that are all taking their fees. It may seem like a little difference now, but it all counts.

All of this isn’t to make you feel like you’re being slack for not really caring about your super - it’s not something that people really talk about that much! As the old saying goes - the best time to plant a tree is 30 years ago, but the second best time is right now.