How to change super funds
Found a super fund you like better? Making the switch is easy and you can do it all online! Here’s what to do…
Step 1. Join the new super fund
Once you’ve found a fund you like, it’s time to join. Head to their website, download the super fund membership form and fill it out. Make sure you have all your important information handy including:
- Name address and Tax File Number
- Your employers business name, address and ABN
- The details of the beneficiaries who will inherit your super if you die
The form will also ask if you want to take out life insurance within the policy. Default cover includes death cover and disability cover (TPD), but you may also have the option of taking out income protection. You may also opt out of insurance altogether.
Step 2: Transfer your old super into the new fund
There’s nothing stopping you from keeping two or more super accounts, but most people will want to have everything all in one convenient place. If you do decide to transfer your super, your new fund will have a 2nd form that allows you to do this, usually called a ‘transfer your super’ form or something similar.. Download this form and fill it out with the following details:
- Your existing fund’s name, phone number, ABN and Unique Superannuation Identifier (USI), which you can find on the new fund’s website.
- Your membership and/or account numbers
You’ll submit this form with the new super fund, and they’ll take care of the rest including organising the transfer and having your old account closed.
Step 3: Notify your employer
Now all you need to do is notify your employer so that all future super contributions will go to the right place. Ask your employer for a ‘Superannuation super choice form’. Fill it out with your name, the name of your fund and your membership number.
And with that, you’re all set!
Should I switch super funds?
Switching super funds can be a good move, particularly if you find one that suits your needs better. For example, if your current fund has been performing poorly, or if you decide to opt for an ethical super fund that aligns with your values. But before you proceed, ask yourself the following questions:
- How does the super fund’s performance compare? Remember, while past performance is not a reliable indicator of future performance, it can provide some insight into how well the fund is managed.
- What are the fees involved? Superannuation fee structures can vary significantly between funds, and lower fees can lead to substantial savings over time.
- Is the new fund truly ethical? If choosing an ethical fund, make sure you research its investments to ensure there are no secondary investments in industries you want to avoid.
- What insurance options are available? Make sure that the insurance coverage with the new fund fits your needs.
- Are there any costs associated with switching super funds? Exit, entry and transfer fees are rare these days, but it never hurts to double check.
In other words, don’t go into it blindly. This is your retirement we’re talking about, so do your due diligence and only switch super funds once you’re absolutely sure about the new fund. And if you’re unsure, it may be a good idea to seek professional advice.
Changing your super fund FAQ's
Will I owe capital gains taxes if I switch super funds?
No, since you aren’t ‘cashing out’ your super, you won’t have to pay capital gains taxes simply for switching funds. Capital gains taxes only apply when you withdraw your money.
Do I need to switch super funds when I change jobs?
No, you’re entitled to stay with your current fund instead of joining your employer nominated fund. Simply ask your new employer for a ‘Superannuation super choice form’, fill it out with all the correct details for your chosen fund, and return it to the employer.
How do I compare super funds?
When comparing super funds, it's usually a good idea to look at their past performance and their fee structure. While past performance is not a reliable indicator of future performance, a well performing fund might offer insight into effective management and strategy. As for fees, you’ll generally want to go with lower fees, all else being equal.
If you’re considering an ethical super fund, you’ll want to research their investments to ensure they aren’t investing in industries you’re looking to avoid - including through secondary investments.
Can I have more than one super account?
Yes, there’s nothing stopping you from having more than one fund. However, this is generally not a good idea since multiple superannuation accounts means multiple sets of fees. Instead, you should consider consolidating the accounts.
If you decide you want to keep them separate, and you’re no longer contributing to one or more of them, make sure you keep your contact details updated with the funds and let them know you wish to keep them active. Otherwise they could end up as lost or unclaimed super and you’ll have to jump through some hoops to get them back.
How do I consolidate super funds?
The process for consolidating your super funds is exactly the same as step 2 above. Just choose the fund you’d like to keep and start the process of transferring the money from the other fund into the one you want to keep.
Does it cost money to change super funds?
Typically no. While some super funds may charge an entry or exit fee, these are becoming less and less common. That’s why it’s all the more important to check the fee structure of any fund you’re considering.
