Super is generally people’s second biggest asset after owning their own home.
Understanding exactly what you’re entitled to and where your money is going, can go a long way to ensuring you have enough to retire on.
Contributions
Your superannuation savings are built through compulsory employer contributions, known as the Superannuation Guarantee (SG), as well as any voluntary contributions you choose to make yourself either before or after-tax. Find out more about the differences between these types of contributions in the Building your super section.
The Government also offers a co-contribution scheme to help build your balance – Super Guru has more details on the government co-contribution.
If you’re self-employed, you may be able to claim a tax deduction for personal contributions you make to super. The Australian Tax Office has more details on claiming deductions for personal super contributions.
The Superannuation Guarantee (SG)
The largest source of super is generally the SG. Legally, whether you work full-time, part-time or casually, your employer must pay at least nine per cent of your salary into a superannuation fund or a Retirement Savings Account (RSA) so long as you are:
- aged between 18 and 69 years old; and
- paid a minimum of $450 (before tax) in a calendar month;
or, if you are under 18 years old and paid a minimum of $450 (before tax) in a calendar month, that you work 30 or more hours in a week.
What happens to your money?
Superannuation is treated differently to most other savings. There are special tax treatments and concessions applicable to superannuation contributions to help Australians save for their retirement. Visit the ATO website for more information.
What your employer does
If you’re entitled to receive the SG, your employer is required to pay this compulsory contribution to a super fund at least every three months and in accordance with the ‘choice of fund’ rules. Your employer is required to use ordinary time earnings to determine the amount of your contribution.
What your super fund does
Once your superannuation fund receives your contributions (either from your employer or your own voluntary contributions), it invests this money either in a default strategy or one you have chosen yourself.
Most super funds offer a number of investment options including a range of asset classes with different rates of risk and growth. Find out more about investing your super.
Fees and charges
Super funds do charge fees for the services they provide, usually as a dollar amount or a percentage of your balance. These include general fees such as administration, member and investment, as well as optional extras including adviser fees and insurance premiums.
Your role
Although the compulsory nature of the SG means your super should continue to accumulate without you having to do much at all, it is important you keep an eye on your superannuation payments and balance to ensure your money is working as hard as it can for your retirement.
Super Guru has more information on keeping track of your super.
Who is responsible for regulating superannuation?
There are three main Government agencies responsible for regulating and enforcing the laws of superannuation:
1. The Australian Prudential Regulation Authority (APRA)
APRA regulates all super funds, except self-managed superannuation funds (SMSFs), to ensure they are run correctly. It supervises the actions of super fund trustees to ensure they are exercising their obligation to manage the fund in the best interests of members.
For more information on APRA, visit the APRA website or phone 1300 131 060.
Did you know: APRA is not responsible for checking the investment strategies of super funds to see if trustees are choosing well-performing stocks or investing in the right markets. This places some responsibility on you and your advisers to make sure your super money is invested in a fund and an investment option, that suits you.
2. The Australian Securities and Investment Commission (ASIC)
ASIC regulates the superannuation industry in the interests of consumers. It is responsible for enforcing the Corporations Act and other laws to protect consumers and promote fairness in financial products and services, financial markets, and Australian companies.
ASIC is also responsible for ensuring superannuation funds are following the rules relating to what they need to tell their members. If you believe your fund is providing inadequate, misleading or deceptive information, or if you are concerned about misconduct, fraud or dishonesty, ASIC can help.
You can visit ASIC’s main website or contact ASIC at infoline@asic.gov.au or 1300 300 630.
ASIC also provides a useful consumer site about financial matters: MoneySmart.
3. The Australian Taxation Office (ATO)
The ATO regulates the reporting requirements of super funds, including self-managed superannuation funds (SMSFs), as well as employer contributions and superannuation tax concessions.
Part of the ATO’s role as regulator of SMSFs is to help SMSF trustees understand their duties and responsibilities under the law and make it as easy as possible to comply. For SMSFs, it is also in charge of:
- verifying whether a fund's primary purpose is to pay retirement benefits to its members;
- providing information and forms to help people set up and manage their fund;
- checking funds are managed in accordance with the super laws;
- implementing and maintaining systems to check the laws are complied with;
- taking enforcement action to correct matters when breaches of the law are detected; and
- checking that approved auditors perform their duties to the required standard.
The ATO also provides assistance for finding lost super with its SuperSeeker service. Find out more in the Lost super section or phone the ATO on 13 10 20.
The Superannuation Complaints Tribunal (SCT)
The SCT is an independent tribunal set up by the Commonwealth Government to deal with complaints about superannuation, annuities and deferred annuities, and Retirement Savings Accounts (RSAs).
The SCT always attempts to first use conciliation to resolve the complaint, but where this is not possible, it may formally review the fund's conduct or decision. The SCT has the power to change a decision on the grounds of what is fair and reasonable.
The SCT can only deal with certain complaints and issues relating to superannuation. These include the decisions and conduct by:
- trustees of funds and approved deposit funds;
- insurers in relation to the insurance benefits provided by funds and RSAs;
- life companies as providers of immediate and deferred annuities;
- providers of RSAs;
- people acting on behalf of the trustee, life companies and RSA providers; and
The SCT does not deal with complaints about the operation of an SMSF by a member of the SMSF.
Before you can lodge a complaint with the SCT, you must first make a complaint to your fund to try and resolve the matter under its internal complaints arrangements. If you’ve made a complaint to the fund and are not satisfied, or you do not receive a response within 90 days, you can then lodge a complaint with the SCT. Each party would pay its own costs.
To contact the SCT, email info@sct.gov.au or phone 1300 884 114. You can find past decisions of the Tribunal on the SCT website.
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