Your Complete Guide to Combining Super

If you’ve had various jobs, you probably have various superannuation funds. Whilst a diversified approach sounds like it could be lucrative, the opposite is likely true. As part of our financial services, ActOn Wealth provides tailored, strategic superannuation advice to clients. Here, we share a thorough, easy-to-absorb guide to the benefits of consolidating super, the factors that might prevent you from doing so, and how to go about it if no administrative restrictions lie in your way. 

Super Consolidation Benefits 

• Reduced fees and charges 

Thanks to myriad administrative fees and charges, you could be losing more money than necessary. Merging super can eliminate the doubling-up, meaning there is more money in your kitty, not in those managing the fund on your behalf.  

• No paying multiple insurance premiums 

Do you have insurance protecting each of your super accounts? If so, you’re probably over-insured. Reducing funds to a single account could provide significant savings in insurance premiums alone. 

• Greater growth potential 

Fewer fees, a bigger pot of money, compounding returns (and savvy investing to begin with) could contribute to more significant growth. 

• Clearer investment strategy 

Numerous funds mean you’re potentially running numerous investment strategies, which can be laborious and hard to manage. Are you sure all these investments complement your financial needs and goals? Rolling over super funds means simplifying your strategy. It also means you’re not spreading yourself thin trying to monitor the performance of too many accounts. 

A super rollover sounds pretty attractive, right? It can be. However, before you start contacting fund managers, you need to ensure you’ve thought this through—read on. 

Things to Consider Before You Consolidate Your Super 

We’ve just discovered some impressive gains to be made in combining super funds. 

However, the nature of your funds could prevent you from going ahead. Alternatively, there could be some significant red tape or even disadvantages to doing so. Our Melbourne financial advisors recommend you ask yourself the following questions first. 

• What are the associated fees for exiting and entering funds? 

The transferring fund, in particular, might have hefty exit fees to deter you from moving your funds. Equally, the fund to which you are transferring may have initial management fees to handle this process. It’s important to ensure you are aware of any and all potential costs. 

• Are regular contributions coming into your superannuation? 

You might be salary sacrificing into one of the funds you plan to rollover. If that’s the case, you need to liaise with your bank and change details before you close the account. 

• Do you have a Self-Managed Superannuation Fund (SMSF)? 

There is a good chance that special conditions may be attached to your SMSF, therefore complicating this process. We strongly recommend you seek experienced SMSF advice before initiating any changes. 

• Could a rollover result in you losing any entitlements? 

One of the funds you want to consolidate might currently provide significant life insurance. You don’t want to throw out the baby with the bath water. It’s therefore important to check first that the fund you’re rolling into can provide ample cover. 

• Could your current employer prevent you from choosing another super fund? 

Just because you’re transferring funds doesn’t automatically stop your existing employer from paying contributions into the incumbent fund. It’s important to speak to them before you take any action and ensure you can choose a different fund in the first place. If you can, obviously, you need to ensure they have all these new details. 

You might now think that super fund consolidation is a little more complicated or time-consuming than you first envisaged. You may not have the hours in the day or the red tape know-how to manage the process. 

That’s where ActOn Wealth can help. Our experienced financial advisers manage these transitions all the time. We know every stone to turn, every question to ask, and every process to follow. We take the time and headache out of combining super. Call us today on 1300 022 866 for a no-cost, no-obligation discussion.

How to Consolidate Super 

How do you consolidate your super? Well, you have two options. Either you go down the DIY path by accessing various ATO website services, or you come to our experienced professionals, and we can take care of the process for you. 

Why Rely on ActOn Wealth to Consolidate Super Funds

ActOn Wealth financial planners forensically examine all details before you transfer super funds. Along with recommendations, we provide a full set of pros, cons, and costs so you can make an informed decision. 

But it doesn’t stop there. We also investigate any unclaimed super, provide ideal growth strategy recommendations, and manage your super fund once you provide direction. 

We not only help you clean up your accounts but grow your wealth from this point on.

FAQs

Why Should I Consolidate My Super?

Combining super funds can reduce administrative fees and insurance premiums, clarify your strategic investment options and provide greater wealth-growing opportunities. We recommend seeking financial advice from ActOn Wealth beforehand.

Is it Better to Have More Than One Super Fund?

Our Melbourne financial advisors typically recommend clients merge super funds, as doing so can provide many benefits. However, beforehand, it is essential to ensure there are no steep fees, hidden costs, or red tape preventing you from going ahead. We can investigate these and other factors to ensure combining super is a smooth and straightforward process for you.

Is Tax Payable on Any Super Fund I Roll Over?

You don’t pay tax when consolidating super, but this can change the moment you go to make a withdrawal. Importantly, you must combine super by transferring your money from one account to the next. You cannot ‘cash out’ and be paid and then merge funds. Doing so would mean your money falls outside the super system and instantly becomes liable to tax.