Is your super fund not performing as well as expected? Do you have more than one fund and want to consolidate them? Curious to learn how to change super funds?

Before you do so, there are a few things to consider, such as how long does it take to transfer super funds and do you need to pay any extra fees for switching to another fund?

We have all the answers.

Can I Transfer My Super to Another Fund?

You are free to transfer or switch super funds anytime you want. You are also allowed to have more than one super fund, so consolidating them into one is usually not an issue. 

In fact, it is sometimes even recommended, especially if your chosen super fund is not providing solid investment returns or hasn’t met regulatory requirements. 

Keep in mind that if you work for a certain industry, you might not be able to choose which fund your super contributions are paid into. If you are not sure that you fall into this category, ask your employer. 

Those who have a defined benefit fund instead of an accumulation fund, should consult a professional before making the switch. Once you leave, it may not be possible to rejoin the scheme. 

When Should You Consider Changing Superannuation Funds? 

There are a few reasons why a person would switch super funds. These include:

1. Cheaper fees 

Super funds are investments that accumulate over time so opting for a new fund that charges even 1% less in fees than your current one can give you hundreds or thousands of dollars in savings over the years. 

2. Switch to a fund more suited to your investment style

Not everyone is comfortable with a high-risk high-gains investment, while others might want a super fund that invests in growth assets, like property and shares, or even ones that trades in international shares. Some might want to go for a more ethical fund that helps the environment while growing your pension. 

If your super fund’s strategy is not aligned with your needs or views or you feel you will benefit from a  more comprehensive range of investment options, it might be a good idea to change funds. 

3. Better performance 

Changing superannuation funds because your current option is not performing as well as expected can be a good reason to look at other alternatives. However, don’t rush and switch funds if you’ve seen one year of poor performance. It might be worth it to wait and see how the fund performs next year. 

Also, don’t be tempted to join last year’s top-performing fund—past performance (unless it goes five or ten years) is rarely an indication of how well your investment is managed. 

4. Consolidate super 

Consolidating super funds when you have more than one is a great way to grow your super. Not only will it be easier to manage your account, but you will also pay less in administration and management fees. What’s more, if you consolidate into a new, well-performing fund, you could significantly boost your super balance. 

How much super do you need to have at your age? Check here.

How to consolidate super funds?

There are three ways to consolidate your super funds into one. 

Note: Consolidating super also gives you a chance to locate a lost super fund you might not even know you had. If you changed a lot of jobs it is possible that you have a superannuation that you’ve lost track of.

  • Log into my.gov.au and link your account to the ATO. On the ATO’s site click on Super, select Manage and then Transfer super (this option will not appear if you are not allowed to transfer your super).
  • Ask your new super fund to consolidate your other existing funds
  • Use the ATO’s rollover form and send it to your fund.

How Do I Transfer My Super to Another Fund?

It may sound complicated but changing super funds is actually a very simple process that can be completed in four steps.

1. Compare super funds

There are a few key aspects that you need to consider when choosing a super fund, including fees, past performances, and investment options. You can easily compare super funds by using the ATO’s YourSuper tool or checking the fund’s product disclosure statement. 

Once you are satisfied that the fund meets your needs and risk appetite, you can move on to the next step. 

2. Join your new fund

The next thing on the ‘how to switch super funds’ list is to join your new fund. You can do this by filling out the membership application form online, which is very quick and completed in minutes. 

You will need to provide a few details, such as your Tax File Number and contact information, your employer’s name and address as well as the personal details of your nominated beneficiaries, i.e. the person who will get your super in the event of your death. 

You will also be asked what kind of insurance you want, so think about which coverage is a must for you. Most funds offer death and TPD insurance, but you can add other types of coverage as well.

3. Move your super balance 

Step three involves transferring your super balance from your old fund into the new one. If you have the details on your previous fund, you can usually log into your new account and follow the steps outlined. 

More information: What Happens to Super When You Die

However, if you don’t know where your former super is, use the ATO’s rollover tool to find it. 

Once you have submitted the details, your new super fund will contact your previous fund and transfer the balance on your behalf. 

4. Inform your employer

Finally, update your employer with your new superannuation details so they can make super guarantee contributions in the right fund.  Your super fund will provide you with a form you can fill out and give to your employer. 

Note: Applications for partial transfers must be made directly at your current super fund.

You might be interested in: How much can you contribute to your super?

How long does it take to transfer super funds? 

This depends on how quick your new super fund can process your information, but it usually takes one to three weeks. 

Sometimes it could be longer so it’s important to check in with your fund and see if any information is missing from your application. Try to get weekly updates on the transfer—this might speed up the procedure and allow you to stay on top of the situation. 

How much does it cost to change super funds?

There are no tax implications or fees for changing super funds. That said, your super fund might impose some fees when you cash out your investment in the form of a buy/sell spread fee. 

You will not pay any entry fees for joining a new fund, regardless if you transferred your entire balance or part of it. 

Do I have to pay CGT when changing super funds?

In general, no since you are not making any profit or loss, but rather keeping the funds in the same system. If you are eligible to access your super  and move the money to your bank account and then to another super fund, you might be liable for Capital Gains Tax. 

Are there any cons to changing super funds?

There are some risks involved in transferring super funds.

Related reading: When can you retire in Australia?

Bottom Line: Is It Worth Changing Super Funds?

Yes. In fact, by sticking with your existing fund you might actually be losing money. 

  • You may lose your insurance cover. Your new fund might leave you underinsured or charge higher premiums, so it is important to check what insurance provider your new super fund partners with and what exactly is covered.
  • Your super fund might not allow it. Some funds have rules in place that could prevent you from switching to another super fund.
  • Although this is not very common, some employers are only willing to contribute to a designated fund.

It is estimated that for more than a third of Aussie pensioners, super is the main source of income in retirement. In other words, if you want a comfortable life after leaving the workforce, you need to look into how your super is doing and switch funds if necessary. 

1. How do I transfer my super to Australian Super?

Australian Super is one of the biggest and best-rated super funds in the country. Switching to this fund is no different than other super funds. Simply join by filling out the application form and then update your employer.

2. How long does it take for Australian Super to transfer money?

Australian Super can take up to five business days for a cash payment. If you have applied for funds transfer to another super account, the process will take up to three business days. Both timeframes do not consider postage and transfer times. 

3. Do you lose money changing super funds?

No, although your previous super fund might charge you some fees (exit fees have been terminated since 2019). You might also lose out on some insurance benefits. However, sticking with the same fund might cause you to lose money, so if you think your fund is not performing well, it’s time to consider other options. 

4. How to change super funds if I changed my job?

Although you are not required to change super funds when you get a new job, you might want to go with your new employer’s superannuation fund. If not, then simply provide your employer with your super fund details so they can make contributions in the right place.