Holding super funds to account for underperformance
The Government is ensuring your hard-earned retirement savings are protected from underperforming super funds. By 1 July 2021, MySuper products will be subject to an annual performance test.
If a fund is deemed to be underperforming, it will need to inform its members of its underperformance by 1 October 2021. When funds inform their members about their underperformance they will also be required to provide them with information about the YourSuper comparison tool.
Underperforming funds will be listed as underperforming on the YourSuper comparison tool until their performance improves.
Funds that fail two consecutive annual underperformance tests will not be permitted to accept new members. These funds will not be able to re-open to new members unless their performance improves.
By 1 July 2022, annual performance tests will be extended to other superannuation products.
How will you benefit?
Helping you switch your super from an underperforming fund to a better fund will significantly boost your retirement savings. A typical Australian spending their working life in the worst performing MySuper product would be up to $98,000 worse off at retirement. Across the entire industry, holding underperforming funds to account will mean at least $10.7 billion more in retirement savings over 10 years.
Source:Budget Factsheet 2020-21
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Last modified: Monday, October 12, 2020