Considering how hard we work for our money, it’s quite astounding that, according to the ATO, there is over $12.5 billion in lost super in Australia. Consolidating lost super is, therefore, something that’s well worth doing.
You can see how it might be easy to lose track of your super funds, especially if you’re one of the some 1.8 million Australians who change jobs at least once a year. But if you end up with several different super funds, you will find it hard to manage them and will end up paying much more than you need to in account fees.
Consolidating your super funds
Having one single super account makes it easier for you to keep on top of employer contributions, fees, insurance cover and fund performance. It’s therefore advisable to roll any super you have from your past jobs into your current account.
The ATO has started doing this automatically for accounts with low balances (originally below $1,000 but increasing to $10,000) by sharing details of these accounts with members’ current funds.
Where a superannuation fund holds multiple accounts for the same individual, they must consolidate those accounts where possible so that the member doesn’t have to pay unnecessary charges on duplicate fees.
Many funds offer a ‘consolidation’ service to make the process easier, but you should always check how much is charged for this before going ahead. Also find out where you stand with any benefits attached to your account. In particular, make sure you have adequate life insurance in place if you close down a fund where you previously had cover.
Changing your name, your address, or your job (or any combination of the three) can cause your previous super to be lost if it can’t be linked back to you. Remember to always update your details with your super funds – or, to make life easier – just consolidate them with your current fund.
Claiming lost super
If you believe you have lost or unclaimed superannuation, the government’s SuperSeeker tool (www.ato.gov.au/superseeker) can help you track it down. This free online super search tool from the ATO only takes a couple of minutes – just supply your name, date of birth and TFN to find out if there is a match.
Any lost or unclaimed accounts will either appear on the lost members register (LMR) and be held by the relevant super fund, or will be held by the ATO.
If you find that you have an account on the LMR, you should provide your updated personal details to the super fund and arrange for your funds to be consolidated. If your balance is below $200 and you meet certain criteria, you will be able to withdraw your benefit.
For a few years now, the ATO has been taking control of lost or inactive superannuation accounts with low balances (currently under $2,500 but increasing to $3,000 in 2017). They will pay interest on all lost super accounts which are later reclaimed.
Summary of claiming and consolidating lost super:
- The easiest and most cost-effective way to manage your super funds is to consolidate them into your current one
- The ATO may do this for you if you have a low balance and all your details are up to date. If your fund offers a service for consolidating lost super, be sure to check the associated cost
- If you hold multiple accounts with the same super fund they must consolidate these where possible
- Lost super can be claimed from your super fund or, if the account has a low balance, from the ATO
- Always update your details with your super fund if you change your name, address or job