With so many different options on the market, searching for a superannuation fund can be complicated.
When you’re conducting a superannuation search, it’s easy to get overwhelmed. You’re essentially looking for a super fund that fits your needs and gives you the greatest return on your contributions.
Here are the things you need to compare in your superannuation search:
Start by looking at what investment options the fund offers and look at the historical performance to get a gauge on what type of returns you might be able to expect. While past performance is not a guarantee for future returns, looking back at the returns in the past five years may give you a very rough idea of the return you can expect.
When it comes to investment options, some people prefer having the flexibility to pick their investments. If you want a fund that lets you choose your investment based on industry or life stage, search for a super fund that suits your preference.
Depending on your level of interest and ability, some funds let members do their own investing. If you prefer a greater say in your investments, look for a fund that gives you the control to put your money where you want it. You may also opt for total control of your superannuation investments through a self-managed super fund (SMSF).
Some managed super funds offer an ethical investment option. If you prefer your funds to be invested in, say, renewable energies as opposed to mining, then search for a superannuation fund that offers the investment options you’re looking for.
As you cannot predict future returns, experts recommend focusing your superannuation search on funds with low fees. Generally speaking, the lower the fees, the better. As superannuation is generally a long-term investment, fees can add up considerably over time.
Not all fee structures are the same – some funds charge additional fees for extra services like advice or different types of investments. Before you make any decisions, find out exactly what the fees are for and work out if the costs outweigh the benefits. For a full breakdown of any potential fees, use the fund's online services to view its Product Disclosure Statement.
When you’re searching for superannuation, you may notice different types of insurance offered by each fund.
The majority of superannuation funds will offer insurance as an option, and one of the advantages of taking insurance through your superannuation fund is that the policies are often discounted. Terms and conditions of insurance funds within super differ greatly, so do your research to make sure the type of cover holds up if you need it and that the premiums are worth the cost.
Common types of insurance within a super fund are:
- Life insurance
- Total and permanent disability (otherwise known as TPD insurance)
- Income protection insurance
It’s worth noting that some funds offer insurance on an opt-in basis, which means that it’s not automatically enabled when you open the super account. If you want insurance, check the details to make sure you’re covered.
