Why should you care about super in your 30s?

Published on: February 11, 2020

Written by:

Adam Faulkner

When you first started out in the workforce (or even at a new job), you most likely would have been given a stack of paperwork to fill in on your first day. Along with your tax file number and bank account details, your employer would have asked whether you had a super fund. For the vast majority of us, the answer would have been ‘no, what’s that?’ or ‘I can’t remember’. As a result, you signed up to the company’s default super fund. Some have kept that super fund as they progressed with their career, others have switched or created new accounts as they moved jobs. 

Now, this doesn’t necessarily mean you’ve spent your working life (so far) contributing to a poor performing fund. It just means that you haven’t reviewed or compared your fund to others in the market to ensure you have the fund best suited to you and your financial goals.

Why is it important to consider super in your 30s?

When it comes to saving money, even the smallest changes made when you are young can have a massive impact by the time you reach retirement. For example, cutting out your $4.50 daily coffee (and investing that money) can lead to an extra $196K in your pocket by the time you retire. A similar result can be achieved by reviewing and comparing your super fund to find the best deal. Whether it is finding a fund with lower account fees or switching to a better performing fund, even a small initial saving can have an impressive impact on your retirement nest egg. It may also be that you wish to invest in a certain way or be more socially responsible with your investments. 

Where do I start?

There are a number of elements that could be costing you money with your super. The first step is to check that you don’t have any missing super. According to the ATO, the pool of lost or unclaimed super now exceeds $20.8 billion, so it’s important to check that you don’t have any lost accounts. In the past, this was a time-consuming task, now the process is easy via the MyGov website. If you find any additional accounts, consolidate! You don’t want to be paying more than one administration fee.

The next step is to review your existing fund. Look at its performance, fees, and insurance. All funds are set up differently, so make sure you capture all the charges, from administration, investment, and advice fees, through to exit and switching costs. By understanding all the fees and charges, you will be able to make a fair comparison to other funds.

Whilst doing this exercise, it is important to look beyond the super funds you already have and consider the wider market. This can be overwhelming and it’s where your LMC adviser can help you focus on the important elements you are after. 

Don’t forget insurance

When you are young, your ability to earn money is your most important asset. Yet we often overlook insurance. Income protection is essential and can be cost effective within your super. It is when you move into different stages of life, like having a mortgage or children, that you need to consider increasing your insurance cover to ensure that you and your family are adequately covered if something were to happen to you.

Just remember, your 30s are the perfect time to review your super fund. Even the smallest saving you make now can have a significant impact on your retirement fund in the future.

General Advice Disclaimer

Information contained within the blog is of a general nature only. Individuals should not act upon any such information without prior consultation with a qualified financial adviser to ensure that any action meets their personal financial needs, situation and objectives. No responsibility is accepted for those persons acting on information contained herein and persons do so at their own risk. 

Responsibility is disclaimed for any inaccuracies, errors or omissions. Particular investments are neither invited nor recommended. All expressions of opinion are published on the basis that they are not to be regarded as expressing the official opinion of any other person or entity unless expressly stated.

Life Money Co Pty Ltd is a Corporate Authorised Representative No.1276114of MyPlanner Professional Services Pty Ltd ABN 51 159 696 830 (AFSL 425542).