The email from your super fund you don’t want to miss

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We’re officially two months-ish away from Christmas, which means it’s time to start planning your gift buying before the shops fill up with people and all the good panettones go out of stock.

But what if I told you the best gift you can get is already under the (proverbial) tree?

That’s right, I’m talking about your superannuation statement! Each year, usually around September to October, the big super funds send members their annual account statements, which refer to the past financial year (so June 2024 to June 2025).

These will have arrived as an email or a letter, which you likely ignored, but trust me − they’re riveting reading. Inside you can find a detailed breakdown of your super balance, your employer’s contributions, how your super is invested, your level of insurance cover and the fees you’re paying. What fun!

What’s the problem?

However, people ignoring these statements is a real issue. Recent research from Australian Retirement Trust (ART) found just one third of Australians feel prepared for retirement, and two thirds of us admit we need to pay more attention to our super.

Opening and understanding your super statement is a great way to take meaningful action on both of these points. So pour a fresh cup of coffee, login to your super fund’s website, and have a look.

What you can do about it

Here’s what you should be looking out for:

• Your balance: Here it is, the big one. Your super balance is the first thing you should be looking at, along with whatever contributions you or your employer has made during the past financial year (remembering the super guarantee last financial year was 11.5 per cent). Some fund statements will give you a projection of your account balance come retirement, or you can calculate it yourself using Moneysmart’s online tool. If your balance is lower than you’d like, it might be time to think of ways to boost it through additional contributions, salary sacrificing, downsizer contributions or partner contributions. Similarly, if you think your employer is underpaying your super, check in with them ASAP.
• Your returns: The next part of your statement will lay out the returns for your super allocations for the financial year. If all your super is in one allocation – such as balanced, growth etc – you’ll have just the one rate of return to track, but if you’ve split your super into different allocations you’ll have multiple, showing the return over one year, five years and 10 years. Anne Fuchs, executive general manager for advocacy and impact at ART, says the number to care about is 10 years, or whatever the longest term you have if your super account is less than 10 years old. “Superannuation is one of the longest term investments you’ll have, so looking at it over a one-year timeframe isn’t the best thing to do,” she says. Take your fund’s returns and compare them to a reputable data source such as SuperRatings or Chant West to see how they compare. For example, SuperRatings’ 10-year annual return for balanced funds is 7.2 per cent, while for growth it’s 8.2 per cent. “If it is very plain that your fund has consistently underperformed other funds, then I would say you need to go and shop around or go get some financial advice,” Fuchs says. A quick reminder too about allocations: generally, the younger you are, the more you should have your super allocated to growth assets. This is a good time to check your allocations are aligned with your stage of life.
• Your fees: Next up is your fees, which for many years were the big bad wolf of super accounts, known for eating up your returns. However, numerous reforms over the past decade have reduced the voracity of fees for most accounts, though some workers are likely still paying more than they should. Your fees are broken down into an administration fee and investment fee. Admin fees are typically a percentage of your account balance or a flat monthly fee, or a combination of both. Investment fees are charged as a percentage of your super balance, and are generally higher for growth accounts and lower for balanced and conservative options. Sally Tindall, data insights director at Canstar, says the average overall fee is 0.87 per cent, where the lowest available is 0.27 per cent. “Anything approaching an overall fee above 1 per cent is considered high and can significantly eat into long-term returns,” she says. However, high fees aren’t always a bad thing, Fuchs says, as most funds include performance fees if your balance has grown well over the year. “If you’re paying a bit more in investment fees, it means the fund manager has outperformed, and that means you’ve actually earned more money,” she says.
• Your insurance: Finally, your super statement should mention the level of insurance cover held within your fund. It’s important to regularly review this, Fuchs says, as your age and situation changes. “Insurance is a bit like Goldilocks – it has to be just right. You need to constantly be looking at your stage of life, your debt, your dependants and if you’re paying the right amount of insurance,” she says. “If you’re paying too much you’re just eroding your balance unnecessarily.”

Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.