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How to grow your super in Australia and boost your retirement savings

4 minutes| Jun 19 2023

Growing your superannuation is one of the most effective ways Australians can build long-term retirement savings. Because super is invested over many years, even small changes in contributions, investment choices or fees can influence the size of your super balance at retirement.

Many people review their super when their annual super statement arrives. This can be a useful opportunity to check contributions, investment settings, fees and insurance arrangements to better understand how your super is performing.

Below are several common steps people take when reviewing how to grow super in Australia and manage their retirement savings.

Check your super balance and accounts

The first step in reviewing your super is locating your latest superannuation statement. Most super funds now provide statements through their member portals, websites or mobile apps.

If you’re unsure where your super is held, you can check through the Australian Taxation Office.

Log into:

myGov → ATO → Super → Fund details

This section lists super accounts linked to your tax file number and shows information about your current funds.

Searching for lost super in Australia through the ATO can also help identify old accounts created when changing jobs.

Step 1: Check your super contributions

Reviewing contributions can help confirm that the expected payments are being made into your super account.

The most common contribution is the Superannuation Guarantee (SG). This is the minimum amount employers must contribute to an employee’s super fund.

Employees may be eligible for SG contributions if they are:

  • Full-time employees

  • Part-time employees

  • Casual employees

  • Temporary residents working in Australia

From 1 July 2022, the previous $450 per month income threshold for SG contributions was removed, meaning employers must generally make super contributions regardless of how much an employee earns.

Super Guarantee contribution rates

The SG rate has been gradually increasing and will reach its final legislated level in 2025.

  • 2021–22 financial year: 10% of ordinary time earnings

  • 2022–23 financial year: 10.5%

  • The SG rate is scheduled to reach 12% on 1 July 2025

Employer super contributions are usually paid quarterly. For example, contributions for the quarter 1 July to 30 September are generally due by 28 October.

Contribution limits

Super contributions receive concessional tax treatment, but there are limits on how much can be contributed each year.

For example, employers are not required to contribute SG above certain income thresholds.

Examples include:

  • $235,680 annual salary threshold for 2021–22, resulting in a maximum SG contribution of $23,568

  • $240,880 annual salary threshold for 2022–23, resulting in a maximum SG contribution of $25,292

Super contribution caps are used by the government to manage how much can receive concessional tax treatment within the super system.

Step 2: Review your super investment options

How your super is invested can play a major role in how your balance grows over time.

Many super funds place members into a default investment option, often known as a MySuper product. These typically include a diversified mix of growth and defensive assets.

Common asset classes inside super include:

  • Australian and international shares

  • Property and infrastructure

  • Fixed interest investments

  • Cash

Most funds also offer alternative investment options with different levels of risk and return.

When reviewing super investments, people often consider factors such as:

  • Investment timeframe until retirement

  • Risk tolerance and volatility

  • Diversification across asset classes

  • Ethical or ESG investment preferences

Information about investment options is typically available through the super fund’s website or member portal.

Step 3: Review fees, taxes and insurance costs

Super accounts often include various deductions that may reduce the balance over time. These may include:

  • Administration fees

  • Investment management fees

  • Contributions tax

  • Insurance premiums

Many super funds offer insurance cover for members, which can include:

  • Life insurance

  • Total and permanent disability (TPD) insurance

  • Income protection insurance

Premiums for insurance inside super are usually deducted from the account balance. While this can provide financial protection, it may also reduce the amount invested for retirement over time.

Understanding these deductions can help members better understand how their super balance changes each year.

Comparing super funds in Australia

From time to time, people review whether their current super fund still suits their needs.

Super funds vary in areas such as:

  • Investment performance

  • Fee structures

  • Insurance options

  • Investment choice and flexibility

The ATO YourSuper comparison tool allows Australians to compare certain MySuper products based on fees and historical net investment returns.

It is important to note that not all super products are included in this comparison tool.

The Australian Prudential Regulation Authority (APRA) also conducts an annual performance test for MySuper funds, which assesses whether funds meet certain performance benchmarks.

Making extra contributions to super

Some individuals choose to increase their retirement savings by making additional super contributions.

Common methods used to contribute extra money into super include:

  • Salary sacrifice contributions, where an amount is contributed from pre-tax salary

  • Personal after-tax contributions, paid directly into a super fund

These types of contributions may help increase the total super balance over time, although annual contribution caps apply.

Reviewing your super regularly

Superannuation is typically built over decades, so reviewing it periodically can help Australians stay informed about their retirement savings.

Common areas people review include:

  • Super contributions from employers

  • Investment options and performance

  • Fees and insurance costs

  • Multiple super accounts

  • Super fund comparisons

Understanding how to grow super in Australia and manage super contributions, investments and fees can help individuals better understand their retirement savings and long-term financial planning.

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