Financial planners exist because financial planning is complicated. Some of what we do is hard, some of it is simply hard work. Superannuation consolidation is an example of something we as financial planners do that is not rocket science but laborious none the less.
I wanted to share Lucille Keen’s experience with you.
Yes I am a serial offender.
I am one of those people with multiple superannuation accounts that pay out more in fees than they make in interest.
Each time I start a new job I also gain another super account with a new fund and new fees.
From this month on, superannuation funds are required to consolidate accounts where a member has multiple accounts within a fund and consolidation is in the member’s best interest. But what happens when you have four separate accounts with four separate funds?
Nothing, unless you make it happen is the answer. Which may explain why, by June last year, there were almost 32 million superannuation accounts in this country. That’s almost three accounts for every working person.
More than $13 billion of unclaimed superannuation is floating around the place but it seems the lure or the lucre is not enough to stir account holders into action.
This month superannuation fund Sunsuper released a Galaxy Research poll that found 16 per cent of those interviewed would rather give up TV for a week, 13 per cent would prefer to visit the dentist and 7 per cent would rather have their in-laws stay, than to spend time sorting out their super.
As a rule, I would have put up my hand for every one of these alternatives but was spurred into action recently by written reminders of untouched funds, including a few hundred dollars from a job in a cooking shop, to the time I worked as a temp in a doctor’s surgery,
I was also spurred on by a recent conversation with former federal superannuation minister Nick Sherry, who was horrified when I happened to mention my multiple accounts.
So I took a day of annual leave to sort out my mess, thinking that would be plenty of time to get the disparate threads of my superannuation rolled into a tidy ball.
Turns out I was wrong. Financial organisations rely heavily on their customers serving themselves online, which works fine when you are doing something you have done many numbers before, such as checking balances or tut-tutting over one’s credit card bill.
There’s a lot of assumed knowledge
But step off your beaten path and you quickly realise there is a lot of assumed knowledge in regard to what forms you need to fill in and how to locate these wretched documents. Admit ignorance, phone the help line and you can still be on that call 35 minutes later, ready to stab the musak maker in the eye but no further advanced in your quest.
At least that was my experience. I also discovered one super fund was happy to roll over my super. As long as all of the funds to be consolidated were incoming. Another told me via email it could take up to four weeks to get the funds moving. Yet another has still to reply to my inquiry.
Now, I fully intend to follow in my parents’ and grandparents’ footsteps and be a self-funded retiree and this is going to take constant vigilance. So, although retirement is decades away, I realise it’s important to consolidate my super. After all it is my money. But first I might inquire about a trip to the dentist. At least that’s just one phone call.
If you share this experience why not try and see a financial planner.
By for now
Source: Financial Review Lucille Keen PUBLISHED: 09 Jul 2013