If you noticed cash was missing from your wallet, it’s more than likely you’d look for it. But, what if the money you lost track of was your superannuation? Would you notice it was gone? Would you know how much was missing? Would you know how to go about finding it?
If you’re thinking, even if you did it probably wouldn’t be much, it’s probably worth a bit of investigation, particularly with 2017 figures showing that there’s almost $18 billion worth of super waiting to be claimed by Aussies right across the country1.
Who has the most lost super?
Analysis by Rice Warner suggests over 60% of lost super accounts transferred by super funds to the Australian Taxation Office (ATO) the year before last were held predominantly by individuals aged 30 to 39, followed by those aged 40 to 492.
Meanwhile, if this money was kept in super and invested appropriately, it could have a material impact on people’s retirement outcomes3.
To put that into perspective, according to the study, a 30-year-old (on an annual salary of $50,000, with a super balance of $25,000) would be around $4,200 better off (in today’s dollars) at age 65 if they recovered just $1,500 in lost super from the ATO4.
How does super go missing?
People often lose track of super when they change jobs, as they might opt for their employer to put contributions into a new fund and forget to carry over what they accumulated in a previous one. This is when super accounts can start to multiply.
When you couple that with the possibility your address and phone number may change over time and you might forget to update your contact details with your providers, your previous super fund or funds can lose track of you.
When is super transferred to the ATO?
Your super fund will hold onto your super money, but report you as a lost member to the ATO if5:
- you’re uncontactable
- it hasn’t received any contributions or rollovers into your account in the last five years
- your account has been transferred by another super fund as a lost account, but no contact details for you can be located
Your super fund transfers super to the ATO (to hold on your behalf) twice a year if you are6:
- over 65 years old, haven’t made a contribution for the past two years and your fund has been unable to contact you for five years
- deceased, and your fund has been unable to pay the benefit to the rightful owner
- a former temporary Australian resident, and it has been six months since you left Australia or since your visa expired
- entitled to be paid your ex-spouse’s super in a divorce, and the fund is unable to contact you
- a lost member whose account balance is less than $6,000
- a lost member whose account has been inactive for 12 months, and your fund does not have the information needed to make a payment to you.
Reasons to find your super today
If you have a lost or ATO-held super account, you can reclaim it. And, the good news is, the financial advantages may be considerable.
This is because a lost account could have quite a bit of money in it, particularly if it has been earning interest. Plus, if you reclaim it before it’s shifted to the ATO, there could be added benefits.
- You won’t lose insurance cover inside your super which you will if it’s transferred to the ATO
- Earnings on investments may be more favourable. This is because if your account is taken by the ATO, interest is calculated using the consumer price index (CPI).
Should you consolidate multiple accounts?
There are advantages to rolling multiple super accounts into one, but there are important things to consider before doing so.
- One super account means one set of fees, potentially saving you hundreds of dollars each year and even thousands over many years
- Having one super account is easier to keep track of with less paperwork and administration
- You can conduct a lost super search as part of a consolidation process and potentially discover additional super money you never knew you had
- With one account it may be easier to manage an investment strategy that meets your own goals, circumstances, and appetite for risk.
- Your other super accounts may charge exit or withdrawal fees, so it’s important to ask upfront
- There could be tax implications depending on your situation
- You could lose some features and benefits you currently have in other super accounts, which may include things like insurance cover.
Want us to do the legwork?
If you’re an AMP customer, check out our free super search to locate your super, which includes active, lost, and ATO-held super accounts.
If you want to roll your super into your AMP account, we can also do the consolidation work for you, however it’s important to consider your circumstances and you may want to speak to your adviser.
If you don’t have an adviser, call us on 03 6343 1007.
Other ways you can locate your lost and unclaimed super include logging in or creating a myGov account via the ATO, or contacting your previous employers and finding out which super funds they paid contributions to on your behalf.