How to improve your finances through your super fund


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One in two Aussies are feeling financial stress, and more than half of us are worried about meeting monthly bills, according to a recent survey from Your Financial Wellness and Aware Super.

Financial literacy is also concerningly low, the survey of 3000 people showed, with only 25% of women and 40% of men able to answer basic financial literacy questions.

And its women and younger Australians feeling the strain, according to the research.

five ways to improve your financial wellness through your super fund

Women report higher levels of "bad" debt and lower super balances, with data from Aware Super showing that, on average, women currently retire with $242,000 less than men.

While the news is grim, it is possible to take control of your finances with a few simple steps.

1. Make up for time out of the workforce

Taking time out of the workforce to have kids or enjoy a career break can have a significant impact on your retirement outcomes.

According to the Your Financial Wellness study, women are twice as likely as men to name having kids as an important life goal - but financial wellness decreases with each additional dependent.

Internal modelling by Aware Super shows that a 30-year-old woman who takes career breaks will need to either work until she is 70 or make additional contributions of more than $6000 each year for the last decade of her working life to close the gap these breaks will cause in her super balance.

If you are planning to take time out of the workforce, consider speaking to an advisor to understand the range of super contribution options that are available to you.

If you're with an industry super fund, there are also tools, calculators, and webinars that you can access in your own time to boost your financial know-how. It's also worth checking your company's parental leave policy just in case your employer does still pay super guarantee contributions to employees on parental leave.

2. Ask for help

Getting financially fit can be overwhelming, so it's important to know where to turn to for help.

Contact your super fund to find out what free advice and information they can offer. Some super funds also share information with non-members.

Seeking out personal advice from a dedicated, qualified adviser can also be very beneficial and a worthwhile investment in your future.

3. Invest in your future

Australians who have at least a month of income saved and those who own their own home score significantly higher on financial wellness tests.

Understandably, not all of us can afford to buy property or even stash savings in the current financial climate, however, super is one way you are already investing in your financial wellness.

For younger Australians, who can often afford to take on more risk given their longer timeline to retirement, a growth investment strategy may be a good option to secure long-term gains.

A lifecycle product that manages your exposure to risk based on your life stage is also an excellent way to take the hassle out of managing your super while affording you flexibility.

4. Don't be casual about your super

Women and young people tend to work in more casual employment, often resulting in multiple super funds. Multiple funds mean multiple fees, and this can cost you.

Minimising your fees alone could add $360 a year to your super before even accounting for the performance of your fund.

Consolidation is key, and it's best to do it early, especially if you're carrying old funds that you're no longer contributing to as you're very likely still paying fees on them.

5. Protecting the planet and your pocket

Nine in 10 Australians believe our finance sector has a role to play in generating positive social, environmental, and economic outcomes, and 86% of Australians expect their savings and super to be invested responsibly and ethically.

We agree, and the good news is you don't have to sacrifice performance to make a positive impact. Responsible investment funds outperformed mainstream funds over one, three, five, and 10 years, continuing despite the COVID-19 disruption.

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Sarah Forman is Aware Super's group executive of advice. Prior to that, she was the acting national manager of BT Financial Advice for BT Financial Group. Sarah holds a Bachelor of Arts from the University of Sydney, and a Professional Certificate in Management from the Graduate School of Management at the University of Adelaide.
Irene Tsang
September 17, 2021 10.06am

I think you say in 4., that to minimising your fee, can add $360. per week to your super is wrong typo! It should be per year instead, I believe.

Money magazine
September 17, 2021 10.21am

Hi Irene,

$360 a week would have been very impressive!

We have corrected that now, and apologise for the error.

- Money team