Here’s the 411 folks, the federal government is set to make a whole bunch of changes to superannuation this year, so we wanna make sure you’re up to speed, bestie. Eeeeesentially, back in October 2020 — also known as the most cursed of years — the government unveiled its Your future, Your Super package.
At the time, Treasurer Josh Frydenberg said the reforms to superannuation would make life much easier for employees when changing jobs, allowing them to take their super along with them whenever they switched employers. Big Josh also said the reforms would make it easier to “name and shame” underperforming funds, as well as putting some pressure on funds to give more info to the general public regarding their investment decisions.
Let’s delve a bit deeper into what this all means for you, shall we?
Your super will follow you like a cute lil loyal puppy when you change jobs
That’s right. Come 1 November, 2021 (pending approval), whenever you change jobs, your super will follow you. This is very handy indeed as changing jobs can be stressful enough as it is, what with all the new forms to fill out, inductions, logistics, etc. My lord, one less headache to deal with is a welcome change I reckon.
And choosing a new super fund can be quite the headache. But luckily, you won’t have to worry about picking a new one if you don’t want to. All you’ll have to do is fill out a choice form, provided by the ATO, and voilá.
Underperforming funds will be named and shamed. Oooo ominous.
Pretty much what it says on the tin — if you’re an underperforming superfund, the people are gonna know about it. This is good news for us, the consumer, as the more info we have on how funds perform, the better.
From 1 July, 2021, funds will be subject to an annual performance test. Those that fall short of producing good returns for their members will be put on the wall of shame, basically. And by wall of shame, I mean they’ll be publicly listed as an underperforming super and have 28 days to advise their members.
Your employer will pay more super. Love that.
Another cool change to expect come 1 July, 2021 is the scheduled increase to the super guarantee. What’s the super guarantee? Glad you asked. Basically, it’s the minimum contribution your employer has to make to your super fund.
Currently, that rate sits at 9.5% of your base salary, but that will rise to 10% once the super reforms come into effect this July. This is good because the more money that goes into your super, the more Maxibons you can buy when you retire.
Info regarding the way your savings are invested will be more accessible
As we all know, information is your friend. Generally, the more you have of it, the better equipped you are when making the big decisions, and choosing the right super is one of those important decisions.
Soon, superannuation fund trustees will also be required to hand out enhanced information which includes info pertaining to the way in which your savings are being invested prior to Annual Members’ Meetings.
So there you have it, folks. All the major superannuation reforms to expect, wrapped up in a neat little package. How fun.
Really, I mean that. Sorry if it sounded sarcastic.
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