How to compare the pair – 3 tips for comparing super funds

We’re often bombarded with information and advertisements around which super fund we should pick but what do we actually need to be looking out for? Hopefully in this blog we can show you a few things you should be looking out for and maybe prompt you to review your own super funds.

 

Tip 1 – Fees

Alright, maybe this one isn’t so surprising but it is important. Fees between superannuation funds can differ greatly and even a 0.5% difference in fee’s can mean a big difference in your balance at retirement. Be sure to look at both investment fees and administration fees and compare a few different funds against your own to make sure you’re not getting ripped off. It is important to note however that fees should not be your only focus as cheapest isn’t always best. Value for money and returns after fees are what really matter. We don’t all go to the cheapest hairdresser as there is a risk that the outcome may not be as good and this can be the same for your superfund.

Tip 2 – Investment options

Each super fund has a varying amount of investment options and it is important to pick an investment option that is right for you. Some funds will only have index funds whilst others will allow you to buy direct shares. Depending on what you’re interested and your tolerance for risk your ability to pick different investment options can play a big part in picking your super fund. For example a wrap account may have access to hundreds of options where as an industry fund may only have a few diversified index funds.

Tip 3 – Insurances

Different super funds have different insurance options and this can be an important factor in choosing a fund. Different definitions can be the determining factor between getting a payout and not getting one. Each fund will also price insurance differently so if you are going to hold your personal insurance inside your super fund then it is important to compare them. For example your employer may have a relationship with the fund that will allow you to get cheaper insurances and these savings on premiums means more money in your pocket come retirement.

 

Bonus Tip – Other benefits

This will very much be a personal preference. Do you need a fund that has really good online access where you can view and see how your super is going at any one time? Well then it may be important to you to make sure you pick a fund that has these. Have a look around and see what each fund offers and what features and benefits are of most interest to you.

As always, if you have any questions about any of these tips or about superannuation in general, shoot us an email or give us a call!

 

Post contributor:

Zac Masters headshot

Zac Masters
Financial Planner @ Pekada

Disclaimer: The information provided on this website is general in nature and does not constitute advice. You need to consider with your financial situation and your particular needs prior to making any strategy or products decision. Pekada will endeavour to update the website as needed. However, information can change without notice and Pekada does not guarantee the accuracy of information on the website, including information provided by third parties, at any particular time Unless otherwise specified, copyright or information provided on this website is owned by Charter Financial Planning. You may not alter or modify this information in any way, including the removal of this copyright notice.

The Trustee for Pekada Unit Trust (ABN 32 736 044 776), corporate authorised representative (CAR), number 443518 trading as Pekada and The Trustee for Pekada Group Trust (ABN 53 194 543 746) corporate authorised representative (CAR), number 235514 trading as Pekada are authorised to provide financial services on behalf of Charter Financial Planning Limited (Charter Financial Planning). AFSL Number 234665

The information provided on this website is general in nature and does not constitute advice. You need to consider with your financial situation and your particular needs prior to making any strategy or products decision. Pekada will endeavour to update the website as needed. However, information can change without notice and Pekada does not guarantee the accuracy of information on the website, including information provided by third parties, at any particular time Unless otherwise specified, copyright or information provided on this website is owned by Charter Financial Planning. You may not alter or modify this information in any way, including the removal of this copyright notice.