Advice from Australian Unions

We’re always paying attention to our wages: how much comes into our bank account and when, making sure we’re getting decent pay increases each year, and saving up where we can.

But it’s rare we give our superannuation the same attention. It’s time to change that.

Retirement may seem a long way down the track but the money you need for a decent retirement cannot be accumulated overnight. It pays – literally – to get on top of your super sooner rather than later.

We’ve made this checklist to sort out your super in four steps.

1 Avoid doubling up on fees

It is easy to accumulate more than one superannuation account – sometimes even with the same super fund.

Often this happens when you start a new job and instead of providing your existing account details, you sign up for a new account as part of the paperwork you do when starting a new role.

If you have more than one account, that often means you’re paying unnecessary fees. (Some people, though, have good reasons to have more than one account including for insurance purposes or to meet some financial goal.)

A good way of consolidating your super is to go to your industry super funds’ website and get them to do it for you. You can also check through your MyGov to see if there’s more than one account in your name and under your tax file number.

2 Learn about default industry super funds

A big part of why unions fought for superannuation is to ensure that superannuation funds, and the services they provide, are suited to your industry. If you have joined a new workplace, there’s a good chance that your default fund is an industry super fund.

Being a member of your industry super fund is a good way to get ahead. Industry super funds over the long term have performed better, have had lower fees, and have insurance appropriate to your industry.

Most industry super funds work with Industry Fund Services to proactively identify and recover unpaid super from bosses who haven’t paid or if the employer goes through insolvency. Just another reason to be in an industry super fund.

3 Bargain for better super

A big part of being in a union and getting a better deal for workers is negotiating an enterprise agreement and bargaining for super. Workers bargain not only for a better deal, but to ensure super is paid above the minimum, on time, in full, and on all wages.

By default, many workers miss out on super, but with your union you can fight for a better deal in super and to make sure that your super is contributed to an industry super fund.

4 Decide if you want to contribute to your super via salary sacrifice

Thanks to the Superannuation Guarantee, all employers in Australia must provide contributions to your super that are minimum 10.5 per cent of your ordinary earnings. These contributions are paid on top of your regular wages and will increase to 12 per cent over the next three years.

If you want to make extra contributions to your super beyond what your employer provides, you can choose to salary sacrifice.

Salary sacrifice is when a certain amount from your income is transferred regularly as a pre-tax contribution into your superannuation.

These contributions are taxed at a lower rate of 15 per cent (provided you contribute less than $27,500 per year).

Your employer is the one who makes the transfer before you’re paid. So not only does salary sacrificing mean your super account is bolstered, it also reduces your taxable income.

How union members are pushing for fair retirement

Lower paid workers are automatically on the back foot when it comes to super. There are also other inequalities that come into play that see women and Indigenous workers retire into poverty.

This unfairness is exactly why union members continue to campaign for stronger superannuation laws.

In 2022, we saw an increase to the superannuation guarantee from 10 per cent to 10.5 per cent as well as the abolition of the $450 threshold.

Workers who were earning less than $450 per month with a single employer were not entitled to the super guarantee. Removal of the threshold as of July 2022 was only good news for low income earners and working women in particular.

We have already achieved regular increases to the superannuation guarantee so that it reaches 12 per cent by 2025. But unions are still working towards having that delay scrapped so we can see the 12 per cent guarantee implemented as soon as possible.

The results we have seen in 2022 have come about due to thirty years’ worth of collective action from union members.