Local Government Super

Local Government Super MySuper Age Based Investment Strategy

Past 5-year return
6.62%
Admin fee

$71

Calc fees on 50k

$571

SuperRatings awards
MySuper GoldInfinity Recognised
Past 5-year return
6.62%
Admin fee

$71

Calc fees on 50k

$571

SuperRatings awards
MySuper GoldInfinity Recognised

Based on your details, you can compare and save on the following superannuation

Pros and Cons

Pros and Cons

  • Strong commitment to sustainable investing
  • Insurance offering with competitive rates for automatic insurance
  • Member benefit program provides discounts for travel accommodation, phone and rental cars
  • Full public offer license via Division P which allows members of the public to join, provided that they are eligible to join a superannuation fund in Australia

Summary

Originally established to provide retirement benefits to employees of NSW Local Governments in 1997, Local Government Super (LGS) is now a public offer industry fund. LGS is Infinity Recognised, which is a result of its strong commitment to environmental and social principles.Based on the existing diversified investment options offered in the Accumulation Scheme, the fund's MySuper Age Based Investment Strategy automatically moves members between these options, as they reach specified ages. The Balanced Growth option outperformed the SuperRatings Index over the 5 years to 30 June 2019. Choice members have access to an additional 5 Diversified and Single Sector options. Fees are lower than the industry average across all assessed account balances, although the fund charges an investment switching fee when members change investment options. LGS provides members with a full suite of insurance cover, including Death Only, Death & TPD and Income Protection (IP) cover, with Basic Death and/or TPD cover automatically provided to eligible members. Members can also apply for an unlimited amount of Death Only cover and up to $3 million of Death & TPD insurance. IP is available over a 2 year or to age 65 benefit period with a choice of 30, 60 or 90 day waiting periods, covering up to 85% of salary or a maximum monthly benefit payment of $25,000.Additional benefits available include access to financial advice services, seminars, educational material, interactive tools and calculators, as well as the ability to view account details and perform transactions online through LGS Member Online.

Features and Fees

LGS Fees and Features

Features

Variety of options

Binding nominations

Account size discount

Online Access

Home loans

Financial planning service

Non-lapsing binding nominations

Employer size discount

Anti-detriment payments

Credit cards

Insurance Cover

Health insurance

Insurance life event increases

Total and permanent disability cover

Long term income protection

Fees

Admin fee

$71

Administration fee (%)

0.25%

Switching fee

$27

Investment fee

0.3%

Indirect cost ratio (%)

0.45%

Exit fee

$0

Pros and Cons

  • Strong commitment to sustainable investing
  • Insurance offering with competitive rates for automatic insurance
  • Member benefit program provides discounts for travel accommodation, phone and rental cars
  • Full public offer license via Division P which allows members of the public to join, provided that they are eligible to join a superannuation fund in Australia

Originally established to provide retirement benefits to employees of NSW Local Governments in 1997, Local Government Super (LGS) is now a public offer industry fund. LGS is Infinity Recognised, which is a result of its strong commitment to environmental and social principles.Based on the existing diversified investment options offered in the Accumulation Scheme, the fund's MySuper Age Based Investment Strategy automatically moves members between these options, as they reach specified ages. The Balanced Growth option outperformed the SuperRatings Index over the 5 years to 30 June 2019. Choice members have access to an additional 5 Diversified and Single Sector options. Fees are lower than the industry average across all assessed account balances, although the fund charges an investment switching fee when members change investment options. LGS provides members with a full suite of insurance cover, including Death Only, Death & TPD and Income Protection (IP) cover, with Basic Death and/or TPD cover automatically provided to eligible members. Members can also apply for an unlimited amount of Death Only cover and up to $3 million of Death & TPD insurance. IP is available over a 2 year or to age 65 benefit period with a choice of 30, 60 or 90 day waiting periods, covering up to 85% of salary or a maximum monthly benefit payment of $25,000.Additional benefits available include access to financial advice services, seminars, educational material, interactive tools and calculators, as well as the ability to view account details and perform transactions online through LGS Member Online.

Read More

LGS Fees and Features

Features

Variety of options

Binding nominations

Account size discount

Online Access

Home loans

Financial planning service

Non-lapsing binding nominations

Employer size discount

Anti-detriment payments

Credit cards

Insurance Cover

Health insurance

Insurance life event increases

Total and permanent disability cover

Long term income protection

Fees

Admin fee

$71

Administration fee (%)

0.25%

Switching fee

$27

Investment fee

0.3%

Indirect cost ratio (%)

0.45%

Exit fee

$0
Fund fees vs. Industry average
THIS FUND
INDUSTRY AVERAGE
Fund past-5-year return vs. Industry average
THIS FUND
INDUSTRY AVERAGE
Investment allocation
INTERNATIONAL SHARES
AUSTRALIAN SHARES
PROPERTY
ALTERNATIVES
FIXED INTEREST
CASH
OTHER
Investment option performance
BALANCED
CONSERVATIVE BALANCE
GROWTH
CAPITAL STABLE
+ View additional option performance information
Product
Past 5-year return
Admin fee
Company
Calc fees on 50k
Features
SuperRatings awards
Go to site
6.62%

$71

Local Government Super

$571

Advisory services
Death insurance
Income protection
Online access
Term deposits
Variety of options
MyChoice GoldInfinity Recognised
More details
6.62%

$71

Local Government Super

$571

Advisory services
Death insurance
Income protection
Online access
Term deposits
Variety of options
MySuper GoldInfinity Recognised
More details
6.62%

$71

Local Government Super

$571

Advisory services
Death insurance
Income protection
Online access
Term deposits
Variety of options
MyChoice GoldInfinity Recognised
More details

FAQs

What is salary sacrificing?

A salary sacrifice is where your employer takes part of your pre-tax salary and pays it directly into your superannuation account. Salary sacrifices come out of your pre-tax income, whereas personal contributions come out of your after-tax income.

What are the age pension's age rules?

Australians must be aged at least 65 years and 6 months to access the age pension. This eligibility age is scheduled to increase according to the following schedule:

Date Eligibility age
1 July 2019 66 years
1 July 2021 66 years and 6 months
1 July 2023 67 years

Is superannuation taxed?

Superannuation is taxed. It is generally taxed at 15 per cent. However, if you earn less than $37,000, you will be automatically reimbursed up to $500 of the tax you paid. Also, if your income plus concessional superannuation contributions exceed $250,000, you will also be charged Division 293 tax. This is an extra 15 per cent tax on your concessional contributions or the amount above $250,000 – whichever is lesser.

What are the age pension's residence rules?

On the day you claim the age pension, you must be in Australia and you must have been an Australian resident for at least 10 years (with no break in your stay for at least five of those years). The following exceptions apply:

  • You’re exempt from the 10-year rule if you’re a refugee or former refugee
  • You’re exempt from the 10-year rule if you’re getting Partner Allowance, Widow Allowance or Widow B pension
  • You can claim the age pension with only two years of residency if you’re a woman whose partner died while you were both Australian residents
  • You might be able to claim the age pension if you’ve lived or worked in a country that has a social security agreement with Australia

How much superannuation do I need?

According to the Association of Superannuation Funds of Australia (ASFA), here is how much you would be able to spend per week during retirement:

Lifestyle Singles Couples
Modest $465 $668
Comfortable $837 $1,150

Here is the superannuation balance you would need to fund that level of spending:

Lifestyle Singles Couples
Modest $50,000 $35,000
Comfortable $545,000 $640,000

These figures come from the March 2017 edition of the ASFA Retirement Standard.

The reason people on modest lifestyles need so much less money is because they qualify for a far bigger age pension.

Here is how ASFA defines retirement lifestyles:

Category Comfortable Modest Age pension
Holidays One annual holiday in Australia One or two short breaks in Australia near where you live Shorter breaks or day trips in your own city
Eating out Regularly eat out at restaurants. Good range and quality of food Infrequently eat out at restaurants. Cheaper and less food Only club special meals or inexpensive takeaway
Car Owning a reasonable car Owning an older, less reliable car No car – or, if you do, a struggle to afford the upkeep
Alcohol Bottled wine Casked wine Homebrew beer or no alcohol
Clothing Good clothes Reasonable clothes Basic clothes
Hair Regular haircuts at a good hairdresser Regular haircuts at a basic salon Less frequent haircuts or getting a friend to do it
Leisure A range of regular leisure activities One paid leisure activity, infrequently Free or low-cost leisure activities
Electronics A range of electronic equipment Not much scope to run an air conditioner Less heating in winter
Maintenance Replace kitchen and bathroom over 20 years No budget for home improvements. Can do repairs, but can’t replace kitchen or bathroom No budget to fix home problems like a leaky roof
Insurance Private health insurance Private health insurance No private health insurance

What are personal contributions?

A personal contribution is when you make an extra payment into your superannuation account. The difference between personal contributions and salary sacrifices is that the former comes out of your after-tax income, while the latter comes out of your pre-tax income.

What are concessional contributions?

Concessional contributions are pre-tax payments into your superannuation account. The payments made by your employer are concessional payments. You can also make concessional contributions with a salary sacrifice.

What is the superannuation rate?

The superannuation rate, or guarantee rate, is the percentage of your salary that your employer must pay into your superannuation fund. The superannuation guarantee has been set at 9.5 per cent since the 2014-15 financial year. It is scheduled to rise to 10.0 per cent in 2021-22, 10.5 per cent in 2022-23, 11.0 per cent in 2023-24, 11.5 per cent in 2024-25 and 12.0 per cent in 2025-26.

What happens to my insurance cover if I change superannuation funds?

Some superannuation funds will allow you to transfer your insurance cover, without interruption, if you switch. However, others won’t. So it’s important you check before changing funds.

Am I entitled to superannuation if I'm a casual employee?

As a casual employee, you’re entitled to superannuation if:

  • You’re over 18 and earn more than $450 before tax in a calendar month
  • You’re under 18, you work more than 30 hours per week and you earn more than $450 before tax in a calendar month

What happens if my employer goes out of business while still owing me superannuation?

If your employer collapses, a trustee or administrator or liquidator will be appointed to manage the company. That trustee/administrator/liquidator will be required to pay your superannuation out of company funds.

If the company doesn’t have enough funds, in some cases company directors will be required to pay your superannuation. If the directors still don’t pay, the Australian Securities & Investment Commission (ASIC) might take legal action on your behalf. However, ASIC might decline to take legal action or might be unsuccessful.

So there might be some circumstances when you don’t receive all the superannuation you’re owed.

Who can open a superannuation account?

Superannuation accounts can be opened by Australians, permanent residents and temporary residents. You’re automatically entitled to superannuation if:

  • You’re over 18 and earn more than $450 before tax in a calendar month
  • You’re under 18, you work more than 30 hours per week and you earn more than $450 before tax in a calendar month

How can I keep track of my superannuation?

Most funds will allow you to access your superannuation account online. Another option is to manage your superannuation through myGov, which is a government portal through which you can access a range of services, including Medicare, Centrelink, aged care and child support.

How does superannuation work?

Superannuation is paid by employers to employees, at least once every three months. The ‘superannuation guarantee’ is currently 9.5 per cent – which means that your employer must pay you superannuation equivalent to 9.5 per cent of your salary. The guarantee is scheduled to rise to 10.0 per cent in 2021-22, 10.5 per cent in 2022-23, 11.0 per cent in 2023-24, 11.5 per cent in 2024-25 and 12.0 per cent in 2025-26.

Superannuation is generally taxed at 15 per cent. However, if you earn less than $37,000, you will be automatically reimbursed up to $500 of the tax you paid. Also, if your income plus concessional superannuation contributions exceed $250,000, you will also be charged Division 293 tax. This is an extra 15 per cent tax on your concessional contributions or the amount above $250,000 – whichever is lesser.

You can withdraw your superannuation when you meet the ‘conditions of release’. The conditions of release say you can claim your super when you reach:

  • Age 65
  • Your ‘preservation age’ and retire
  • Your preservation age and begin a ‘transition to retirement’ while still working

 

What are the risks and challenges of an SMSF?

  • SMSFs have high set-up and running costs
  • They come with complicated compliance obligations
  • It takes a lot of time to research investment options
  • It can be difficult to make such big financial decisions

How do you open a superannuation account?

Opening a superannuation account is simple. When you start a job, your employer will give you what’s called a ‘superannuation standard choice form’. Here’s what you need to complete the form:

  • The name of your preferred superannuation fund
  • The fund’s address
  • The fund’s Australian business number (ABN)
  • The fund’s superannuation product identification number (SPIN)
  • The fund’s phone number
  • A letter from the fund trustee confirming that the fund is a complying fund; or written evidence from the fund stating it will accept contributions from your new employer; or details about how your employer can make contributions to the fund

You might want to provide your tax file number as well – while it’s not a legal obligation, it will ensure your contributions will be taxed at the (lower) superannuation rate.

What is a superannuation fund?

A superannuation fund is an institution that is legally allowed to hold and invest your superannuation. There are more than 200 different superannuation funds in Australia. They come in five different types:

  • Retail funds
  • Industry funds
  • Public sector funds
  • Corporate funds
  • Self-managed super funds

Retail funds are usually run by banks or investment companies.

Industry funds were originally designed for workers from a particular industry, but are now open to anyone.

Public sector funds were originally designed for people working for federal or state government departments. Most are still reserved for government employees.

Corporate funds are arranged by employers for their employees.

Self-managed super funds are private superannuation funds that allow people to directly invest their money.

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are special contributions that an employer makes on top of the regular compulsory contributions. One example would be contributions made as part of a salary sacrifice arrangement.

When did superannuation start in Australia?

Australia’s modern superannuation system – in which employers make compulsory contributions to their employees – started in 1992. However, before that, there were various restricted superannuation schemes applying to certain employees in certain industries. The very first superannuation scheme was introduced in the 19th century.

What contributions can SMSFs accept?

SMSFs can accept mandated employer contributions from an employer at any time (Funds need an electronic service address to receive the contributions).

However, SMSFs can’t accept contributions from members who don’t have tax file numbers.

Also, they generally can’t accept assets as contributions from members and they generally can’t accept non-mandated contributions for members who are 75 or older.