The government’s ‘Protecting Your Super’ package came into effect from July 1, 2019.
This article by Choice (Australia’s leading consumer advocacy group) explains what this package entails and helps you understand the key changes to your Superfund.
Here are the key points from the articles:
Protecting Your Super
- For accounts under $6000, Superfund will only be allowed to charge a maximum of 3% of the balance in admin and investment fees.
- If you transfer your account to another fund, Superfund will be banned from charging you ‘exit fees’.
- ‘Inactive’ accounts under $6000 will be shut down and transferred to the ATO. It will look after the money until it can be matched with an active account. ATO won’t charge any fees on it. However, growth on investments will only keep pace with inflation which is usually a lower rate than the interest rate earned in the Superfund.
- From July, life insurance coverage from your Superfund will no longer be automatically provided to people with ‘Inactive’ accounts. An account is considered ‘Inactive’ when no contributions have been made into it in the past 16 months.
- Life insurance in your super may include:
• Death-only cover
• Total permanent disability (TPD)
• Income protection (Salary continuance)
- To decipher which level of cover you may need, use this insurance calculator from ASIC.
Baldwin Financial Services is based in Prospect in the northern suburbs of Adelaide.
Contact us to find out how we may be able to help you.