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Becoming financially independent and secure – budgeting, saving, debt and other key matters.

4g. Understanding superannuation

Est. read time: 3 min

What is Superannuation?

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Superannuation is money that is put aside by your employer and/or yourself over your working life that will fund your retirement when you cease working. The money held in a superannuation account is invested in a range of assets by the super fund that manages the account. You can choose investment options based on where you would like your super money to be invested.  Generally you will not be able to access this money until you reach your ‘preservation age'.

Preservation age is the minimum age, set by law, you must reach before you can access your superannuation funds. Your preservation age is currently between 55 and 60, depending on when you were born. When you reach preservation age, you can access your super as long as you are permanently retired (or reached age 65). If you haven't permanently retired, you can still access part of your super via a transition to retirement pension. More information, including the limited circumstances in which you may be able to access your superannuation early, can be found at MoneySmart's transition to retirement website and MoneySmart's getting your super website.

Your employer will make contributions into your superannuation fund and you can top it up with your own money. The government may also make contributions if you are a low income earner. More information about government contributions to your superannuation fund can be found at the Tax office's website.

Do you have Superannuation?

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  • Check for any annual superannuation statement issued to you. This will give you a good indication of where your superannuation is held and how much you have.
  • If you don't know / lost track of your superannuation, you can check by registering for the Australian Taxation Office's online services via myGov. This will allow you to see details of all your super accounts, including any you may have lost or forgotten about.
  • Once you have found all your super accounts, you can consolidate them into one account using your myGov account..

I do not have any superannuation

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If you are entering into the workforce for the first time and have not had any superannuation account in the past, your employer will put the money into a ‘default' super fund, known as a MySuper account. You can also choose a specific superannuation fund to have your super paid into if you wish.

How to choose a super fund

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In most cases, you will be able to choose the fund that you'd like to have your super contribution paid into. For more information see the MoneySmart's information page on choosing a superannuation fund.

Some industrial awards specify a fund or a choice of a few funds that superannuation must be paid into. In these cases you may have limited or no choice of fund.

Once you have chosen your super fund, tell your employer by filling in a standard choice form from the Australian Taxation Office or from your employer.

If you are divorced or separated

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Getting your superannuation sorted after your relationship ends is an important step in planning for your future. Once you separate or get divorced, superannuation is treated as a type of property and can be divided by agreement or by court order.

Splitting from your partner does not mean you can convert your superannuation into cash – it is still subject to superannuation laws (for example, it is usually retained until retirement)

Options for splitting superannuation

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Separating couples may either:

  • enter into a formal written agreement to split superannuation. A formal written agreement requires that both you and your ex-partner instruct a lawyer who must sign a certificate stating that independent legal advice about the agreement has been given. Once this agreement is made, you do not need to go to court. The agreement is not registered in court and you must be careful that each of you retains a copy;
  • seek consent orders to split superannuation; or
  • seek a court order to split superannuation (if you cannot reach an agreement with your former partner).

You should get legal advice about these options. These websites have helpful resources on superannuation splitting:

Early access to superannuation

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In certain very limited circumstances you can access your superannuation early.  These would include include:

The Australian Taxation Office recognises that severe financial hardship often arises from Family and Domestic Violence circumstances, and offers a range of support for people in this situation, including early access to superannuation.

Early access to your superannuation now will mean that a reduced amount of superannuation will be available to you when you reach retirement age.

[Article last updated:  16/9/21]

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