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Mar 14, 2018
Super has been around as a compulsory payment obligation for employers since 1992. Basically, your employer must pay 9.5% of your wage into a super fund if you’re over 18 and earn more than $450 (before tax) a month. If you’re under 18, and working more than 30 hours per week, you also qualify for employer super contribution payments.
The main reason the government introduced this requirement for employers is to ensure workers can have some savings when they finish work and retire, without having to rely fully on the age pension.
Also from about 2013, super funds were also required to provide life and disability insurance cover for members. So, you may find that a portion of your monthly employer contributions will be paying for insurance premiums, to cover you or your family in case you get injured, sick or die.
What about casuals?
If you’re working in the hospitality industry, it is highly likely you will be employed on a casual or part -time basis.
The good news is that you’re still entitled to super as long as you meet the criteria mentioned above. Whilst it may seem like a small amount when you first start working, over time with interest and regular payments, you’d be surprised at how much you will accumulate. Most of us will be working for at least 30 to 40 years, so starting something sooner that can grow over time is really a good thing to have in place.
The system is also designed to allow for some flexibility, so you can add to your super whenever your financial circumstances allow it.
Backpackers or temporary residents are also covered by super.
If you are a backpacker, when you first gain employment in Australia you are likely to be asked for your super fund details. However, as a temporary resident, the government allows you to be able to claim that money back after you have returned home permanently.
If you travel a lot and work in many places, your main concern as a backpacker is keeping track of multiple super accounts and completing the claims documentation after you have left Australia. An easier and simpler way is to only join one fund and let your super fund do the hard work for you.
If you already have a few super accounts, most funds can track and merge your accounts together. Just give your preferred fund a call and provide your TFN and they should be able to combine all of your super. Just check whether you have any insurance you wish to keep. For more information, see ato.gov.au/individuals/super/accessing-your-super/temporary-residents-leaving-australia/
Which super fund should you choose?
There are several good websites that will help you choose which super fund you should tell your employer to pay to. The government’s Moneysmart website www.moneysmart.gov.au has more detailed information about what super is and what to consider when choosing a fund.
For comparison purposes, in terms of fees, investment options and value for money, you may want to look at the Canstar.com.au website, in particular canstar.com.au/compare/super-funds
This website can be very useful as it also compares other products you may be interested in, such as mortgages and health insurance.
Don’t join every fund!
There are so many super funds out there and you should be aware of the fees they charge, their investment product range, type of insurance cover as well as perhaps the long-term investment performance.
However, the main rule of thumb is to ensure you don’t join every fund you come across. Most funds will allow you to take them with you where you work. Simply complete the Choice of fund form that your super fund can provide and tell your new employer your nominated account details.
Our preferred super fund
Personal service, competitive fees and convenience of account access are essential requirements for young, busy hospitality workers. This is why we have partnered with Club Plus Super as our fund of choice.
After you join, you can work in any industry and still keep your super account open. For more information about how to join, send an email to barcats@clubplussuper.com.au. You will receive an email from their friendly staff and they will assist you with any enquiry you may have about super.
Alternatively, go to clubplussuper.com.au or give their member hotline a call on 1800 680 827.
By the way, this article contains general advice about super. Should you need personal financial advice about your own circumstances, we recommend you chat to a qualified financial adviser.
