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Government grab for your cash


Laine Gordon

By Laine Gordon

3 min read

There is more than $670 million in lost shares, bank accounts and life insurance and some of it could be yours. But you’ll need to get in quick to stake your claim.

New laws allow for any bank or investment account not used for three years to be automatically closed and the money transferred to the Federal Government.

In the past, these so-called “dormant” accounts were allowed to be held for seven years before such action was taken, but now it’s just three years if the financial institution knows who you are.

“It’s just crazy,” says financial commentator David Koch. “We can understand if the financial institution has lost track of you and money goes into an unclaimed pool.”

But this new ruling applies to any account where the owner hasn’t made a deposit or withdrawal from the account for a period of three years or more. The payment of fees or the receipt of interest doesn’t count as a transaction.

How to claim lost money

Your financial institution should notify you before such action is taken, but if nothing is done the unclaimed money will be transferred to the Commonwealth of Australia Consolidated Revenue Fund and it’s quite a process to reclaim it.

You can do a free search of unclaimed money records held by the Australian Securities and Investments Commission (ASIC) through the MoneySmart website.

Or take steps to ensure your money doesn’t become unclaimed; making even a $0.05 deposit or withdrawal on your bank account once every two to three years will prevent your account becoming dormant, according to ASIC.

A good idea may be to put that money into a savings account and add to it over time for an extra income stream. RateCity compares savings accounts with rates as high as 4.65 percent. Or use it to pay down your home loan, if you have one. For further advice, talk to a financial planner or your accountant.

Super losers

The millions of dollars waiting to be claimed by savers may seem like small change when compared with the pool of unclaimed superannuation funds; reports suggest there is around $17 billion in unclaimed super.

Losing track of some of your super is surprisingly easy – it may happen when you change jobs, have more than one job at a time, change names or simply forget how many super funds you have.

Thankfully, tracking down and laying claim to what is yours isn’t as hard you might think. Search for lost superannuation online using the ATO’s SuperSeeker tool and if you find a match in the register it will display details of the relevant account. For more information visit www.ato.gov.au.

 

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