ASIC’s three steps to decode super statements

Thursday 28 October 2010

ASIC today suggested simple checks for people to take control of their super savings.

Delia Rickard, ASIC’s Senior Executive Leader for Consumers, Advisers & Retail Investors said ‘You may have recently received your annual super statement. The key to making the most of super savings is to know the landscape and take stock of your situation.

‘You can do this by comparing your annual statement with last year’s; getting access to your super online; and asking for clearer information from your super fund if there is anything that is hard to understand,’ said Ms Rickard.

Step 1 – Compare to last year

Ms Rickard said ‘Get last year’s statement out from the bottom of your shoe box and place the two statements side by side on the kitchen table. Compare the results and make sure it all makes sense to you.’

Things to compare include:

·       Your balance at the start and end of the year.

·       Your employer’s Super Guarantee payments – normally 9% of earnings.

·       Any extra contributions you made on top of your employer’s.

·       Fees deducted.

·       The cost of life insurance cover, including income protection.

·       How much tax was taken out – normally 15% on contributions.

·       Investment returns credited on your account. These could be positive or negative.
‘If anything doesn’t add up or you think there has been a mistake, contact your super fund immediately’, said Ms Rickard.

Step 2 – Get online
Most super funds let you securely access your super fund account online. You will be given a user name and a password so you can:

·       View your balance.

·       Change investment options.

·       Review investment performance of investment options.

·       Use calculators to estimate how much your super savings will grow.

·       Make extra contributions.

·       Update contact information.

·       Change insurance cover.

·       Change beneficiary details.
Ms Rickard said, ‘Accessing your super fund account online is an easy way to manage your super. Most super funds’ online services are similar in look and functionality to standard online savings accounts so there’s nothing to be afraid of’.

‘Of course, keep in mind what fees are charged if you’re changing investment options or your insurance cover.’

Step 3 – Ask for a clear explanation
Ms Rickard said, ‘Super is one of the most important ingredients in your financial life. But lots of people set and forget. Don’t be one of them’.

If there’s anything on your statement that you don’t understand get on the phone or send an email and ask your super fund to explain it to you. Most super funds have very knowledgeable call centre staff who are there to take your calls. Take notes and ask them to refer you to where you can find more information,’ said Ms Rickard.

Super is a long term investment
Super is a long-term investment and returns change with positive and negative years. Super fund returns were negative for a couple of years during the global financial crisis but this will not necessarily continue to be the case.

Ms Rickard said, ‘Your super fund may have earned less or more than the average fund over the 2009-2010 year but it does not mean the same level of returns will continue. The best performing fund for one year is rarely the best performing fund the next year.’

‘What you should look at are the longer term returns for your super fund. Compare your fund’s return for 5 years against a similar fund and if your fund has performed below average over the five years you may consider moving your money,’ said Ms Rickard.

More information

For more information on super, download a copy of Super Decisions from www.fido.gov.au or call ASIC’s Infoline on 1300 300 630.

On the FIDO website you can also use the Superannuation Calculator and online Retirement Planner to help you work out how your super is tracking. It also provides average long term performance information over five and 10 years for typical super fund options that may assist you in making decisions.

Please note this information relates to accumulation style statements. For information on pensions and defined benefits schemes please see the FIDO website.

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