Superannuation, also called super, is likely an important part of your retirement plan.
Your superannuation, whether it's with MLC or another provider, is the money that you’ll use after your paycheques stop and your retirement starts.
Whether you’re already a member of MLC Super or you’re looking into your options, your choice of a super fund is one that should be handled with care.
How do you join MLC Super?
To fill out your MLC Super application, you’ll need your tax file number and bank details ready.
If you haven’t fully decided which super fund to join, you can compare super funds to make sure you’ve found the one for you.
What are the different types of super funds?
There are a few different types of super funds to consider. Some of the options include corporate, industry, retail and self-managed funds.
Corporate super funds are arranged by employers to benefit their employees. These funds are low-cost and run under a board of trustees.
Industry funds are not-for-profit institutions that were originally set up to serve employees in a particular industry – most, though, are now open to everyone.
Retail funds, like MLC Super, are operated by banks and investment companies. In most cases, anyone can join a retail super fund as long as they meet certain criteria.
Self-managed funds offer the fund holder control over their super. Self-managed funds are attractive to some because they allow you to choose your own investments. However, these funds also add more responsibility and workload, and require greater financial competence.
What should you look for when researching super funds?
Researching your super fund is an integral part of making a sound decision for your future. First, you may want to look at the fees of the super fund you’re considering. If your priority is low fees, it’s best not to spend time researching high-fee funds. Either way, make sure that the benefits of the fund are worth the price tag.
You may also research the investment options of the fund. You’ll want a super fund that fits your investment needs, but also one that suits your level of risk. While some funds offer high-risk (and potentially high-reward) investments, others offer low-risk options for those who are more cautious.
Certain super funds can offer you benefits that can help you build your superannuation faster. Whether it’s the opportunity to make extra contributions or a base level of insurance, you’ll want to choose a super fund with benefits that suit your goals.
What is salary sacrificing?
Salary sacrificing is an arrangement with your employer to have money taken from your pre-tax salary to be used for goods, services, or investments. In the case of superannuation, you may choose to have your employer take a certain amount of money from your paycheque and have it put into your super fund instead, whether that’s with MLC or another provider.
How does money get paid into my super fund?
Money makes its way into your super account in a few different ways. For most, their super funds come directly from their employer. Your employer will pay a certain amount, at least once per quarter, directly into your super fund rather than added to your regular salary.
A second way is through personal contributions. If you choose, you can salary sacrifice or make deposits from your after-tax income into your super fund. In some cases, the government might also make a contribution.
How do super funds invest my money?
When money is deposited into a super fund, it joins a pool of funds that are then invested into different opportunities. Some super funds allow you to choose your investments, while others have a default investment option.
What are the pros and cons of switching super funds?
Deciding to switch super funds to MLC or another provider is one that should be handled with care. There are some positives to switching super funds, such as the opportunity to move from high-risk to low-risk investing or vice-versa. However, there are also negatives. It’s possible to miss out on certain benefits because you switched super funds at a volatile time. When you switch, you’re also adjusting your overall investment strategy. Changing your strategy may require some advice and assistance from a financial planner.
When can I access my super?
Your super fund is intended for use after your retirement. As such, there is a minimum age at which you can access your super, whether you’re with MLC or another provider.
In the majority of cases, you can access your super in your mid-fifties to mid-sixties, but it may be best to speak to your fund to understand your access.
Your super is a big part of your future. Learning about your superannuation could be helpful in making sure that you have a comfortable retirement.