5 most commonly asked questions about super answered

Superannuation can seem like a complex topic, especially when there are a lot of terms, jargon and numbers involved. But it doesn’t need to be complicated, and learning how it works can benefit you and your finances. As the largest financial asset many Australians have after the family home,¹ superannuation is worth understanding. To help you get in the know, we are answering the 5 most commonly asked questions when it comes to superannuation.

1. What is superannuation?

Most simply put, superannuation is money that is put aside into an account that you can access and live off when you retire. Superannuation is commonly referred to as super. For most people, your employer will pay money — ‘contribution’ into your super. Your employer will put 11% of your wage into your super account². It is compulsory for your employer to pay you super — even if you are part-time or casual, unless you are under 18. If you are under 18, you will need to work more than 30 hours in a week to be eligible. If you work for yourself (such as a freelancer or contractor), it will be up to you to make contributions to your super account.

You can also choose to add your own money to your super account.

Your super fund will manage your super account for you, with the aim of providing you with savings that you can use in retirement. Super funds manage their member’s money by investing in different types of assets, such as shares, fixed interest, cash, property, and infrastructure. Every fund will have different investment options. There are various factors you should consider in deciding which super fund to go with, such as investment performance, fees you will pay, the risk associated with the investment options, and the insurance cover available.

2. How much superannuation should I have?

How much super you have in your account is different for everyone depending on your age, wage and time in the workforce. For example, if you have had unpaid time out of the workforce, your super will likely be lower than someone who has worked consistently.

It’s important to understand that everyone’s situation is unique, and therefore your super balance is likely to be different to someone else who is the same age. However, you can check where you’re at against the average Australian.

3. What are the different types of super funds?

For your employer (or you if you are working for yourself) to put money into super, you need to select a super fund. In Australia, there are many different funds that can manage your super savings on your behalf. It’s up to you to decide which super fund you would like to join — just like choosing a bank.

It's worth taking the time to look into the many super funds available and select the right one for you. You can change super funds at any time and are not under obligation to stay with any one fund. If you decide to change super funds, you may want to consolidate your accounts so you aren’t paying multiple fees.

There are several types of funds, including:

Industry funds: An industry fund is a fund that is catered to a specific industry. NGS Super is an industry fund in the education sector. However, like most industry funds, NGS Super is also open to those who don’t work in the education sector. Industry super funds are run only to benefit members and return any profits to their members.

Corporate funds: Corporate funds are usually available to employees of a corporation — and in some cases, also the employee’s family members.

Retail funds: Retail funds are generally run by financial institutions, banks or investment companies. A retail fund will return profits to their shareholders.

Public sector funds: Public sector funds are for employees in the Government sector. Any profits go back into the fund.

Self-managed super funds: A self-managed super fund is a fund that you manage yourself, and you will be responsible for how you invest your money.

4. Can I withdraw my superannuation early?

Typically, to access the funds in your super account, you'll need to meet a 'condition of release'.

Standard conditions of release include:

• ceasing employment on or after age 60
• retiring at or after your preservation age
• undergoing a transition to retirement while continuing to work.

While accessing super before retirement is restricted to limited circumstances, it is possible. For example, you may be able to access your super under severe financial hardship, compassionate ground, incapacity. Please check with your super fund as to the options available to you.

5. How do I keep track of my superannuation?

If you already have a super fund, you will be able to see your fund balance by logging into your account, or you might elect to receive printed statements of your account balance. If you are unsure how to access your account, contact your fund.

You can also manage your super via the Australian Tax Office online services through myGov. In this portal, you will be able to see if you have multiple accounts and consolidate your super funds.

Need help with your super?

If you feel ready to review your finances, why not connect with one of our NGS Super Specialists?

Our Super Specialists are here to help. They can help you to better understand your superannuation, investments, and insurance. They can also help you decide the next steps — including if meeting with an NGS financial planner is right for you.

Seeking advice is a way to plan for your future, help to mitigate the risk and make the most of your saving opportunities. Education is integral to the planning process — it’s important that you feel confident and informed at all times.