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Home > thinking about changing superannuation funds...

thinking about changing superannuation funds...

March 17th, 2010 at 01:34 am

Before I post this, I just want to explain that I DON'T see superannuation as my one and only retirement funding option. I actually HATE the idea of superannuation, of having limited control over 'my' money. While it's all good and well that the government made some sort of step into forcing people to save for their later years, I personally don't like it and the highly publicised encouragement of putting money into an account that a lot of people haven't researched other than whether or not you get a free department store Gift Card when you roll over your funds.

That's my opinion, and before you try, no one here is ever going to change my mind on it, and no one is ever going to convince me to put extra money into it to 'save' for retirement. We both have other options that we are working towards and neither of us are especially excited about the conventional methods of retirement funding. When I find a fund that I am completely happy with, I *may* contribute additional earnings into it, but as of yet, I don't. So please don't blather on about it more than you have to. Smile

Ok, so now that's all said, this is what my real post is all about:

Our bank also runs a superannuation fund. We were told about it when we bought the house, and I put it to the back of my mind. I recently came across something that is making me consider rolling our funds over.

Currently we are with the biggest, most well known superannuation in Australia. I have no issues with them, they're not particularly spectacular either. They seem to get a lot of aussie sporting heroes to do their advertising campaigns, and that's about it. *shrug*

We have our life insurance with our bank because with the loan package we took out, we get a 15% discount on insurance products, and a multi policy discount too. (and yes, because of the cover options they offer as well...) Currently we pay around $54 a month for $200k worth of death and permanent disability cover, for myself and DF.

So I found out the other day that we can roll our superannuation funds over to our banks' fund, and have our insurance taken out of our superannuation fund. Wooaah, you're all thinking now. Bad news.

Not entirely.

You see, our superannuation fund is pre-taxed money. You only pay tax if you withdraw it before you turn... whatever the current retiring age is. 55? 60? something like that.

On top of this, if I were in fact to make extra contributions (yes, you heard me say it) to the TOTAL of the amount of our life insurance each month, the government would pay double that, because of the superannuation scheme they have going.

So technically if I were to pay the amount of life insurance into the account, it wouldn't make a bit of difference to our financial situation, only that I'm getting something that I wouldn't ordinarily be getting.

Hmmmmm. Something worth thinking about?

I'm not sure. Another plus, although only out of convenience, is that every time I log onto my bank account, we will be able to see how much super we have, instead of waiting for the yearly statement. Not that I particularly care, but it would be interesting to know nonetheless.

DF had a good point though. Is it kind of like we're putting all our eggs in one basket? We have basically all of our banking with one bank. We also gain from all the discounts too, but still...

Another plus is that our banks fund does not pay commissions, and the fees are much lower.

Hmmmm.... thinking thinking thinking

4 Responses to “thinking about changing superannuation funds...”

  1. Homebody Says:

    Do you have insured funds, like we do in the US, but not more than $250,000 in each bank account? I would check that first.

    I'm not going to lecture you except to say I wish DH and I had saved more when we were young.

  2. whitestripe Says:

    we're saving, and we intend to build a large nest egg which we're taking steps towards now... but just NOT in a superannuation fund.

  3. zetta Says:

    Sounds like a winning plan if the govt match would cover the cost of your insurance. It doesn't sound like too much with one bank, and you could always choose a different bank or brokerage for your non-super investments.

    Have you thoroughly researched the super funds that are out there to see if there is one more to your liking? At least consider getting all of the govt match -- my grandad used to tell me never pass up free money!

  4. whitestripe Says:

    thanks zetta. my only issue is if it goes down the toilet again, technically i will have my free money, but also be down some of my own money, as well as the free money. my issue with superannuation is that i only have very limited control over it.

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