Don’t leave your super behind when you change jobs – our checklist will help you get it in order in no time.
When you change jobs, make the decision about where you want your super to go yourself – don’t let your employer make it for you.
Take the time to review where your super is, how it is invested, and whether you need to make any changes.
Think about whether you should consolidate your super funds or salary sacrifice part of your income.
Starting a new job? Congratulations!
One of the decisions we’re asked to make when we start a new job is what we want to do with our super. For some people this can be overwhelming, so they let their employer make the choice for them. But it’s your money, so it’s worth taking the time to make sure your super contributions are invested in a way that makes sense for you. It’s not as complicated as you might think. Here’s our checklist of five things you should think about when you change jobs.
1. Where do you want your super contributions to go?
Unless this is your first job, you probably have at least one super fund already. If you want the super contributions from your new employer to go into existing super fund you will need to complete a Super Choice Nomination Form for this fund and give it to your employer. If you don’t tell your employer where you want your contributions to go they’ll set up an account for you with their default super fund. They should give you some information about this fund along with the rest of your paperwork after you’re offered the job. Be sure to compare the fees, insurance and services of this fund to your current super fund (if you have one) so you can make an informed decision about which fund to choose.
2. Do you want to bring all your super together?
It’s easier to keep track of your super when it’s all in the one fund. You may pay less fees by consolidating your funds – which could make a big difference to your super balance by the time you retire – and it gives you a clear picture of how your super is invested, as well as how it’s performing. Before you consolidate, check if you’ll be charged any exit or withdrawal fees and consider any investment or tax implications and whether you want to keep any insurance cover you may have with the fund.
3. How is your super invested?
Super is a long-term investment, and to get the most out of it it’s important to review it regularly to make sure the way it’s invested is appropriate for your financial situation and stage of life. A small change to your super now could potentially add thousands of dollars to your super account by the time you retire.
4. Can you afford to add more to your super?
Often when we start a new job we get an increase in salary, so it’s a good time to think about how you’ll use those extra funds. If you can afford to salary sacrifice a portion of your income into your super fund, there are a number of benefits down the track. You’ll grow your super balance faster and reduce the tax you pay because salary sacrificed funds are taxed at 15% rather than at your income tax rate (which could be as high as 49%). Just make sure you don’t exceed the contribution limits.
5. Is it time to speak to a financial adviser?
If you’ve never spoken to a financial adviser before, this may be a good time to start. We can help you get your super organised and advise you on the best fund, investments and insurance to suit your current situation.