Australia Markets closed

Here's how the super changes affect you

Bessie Hassan
Money Expert at

From personal income tax and cracking down on the black economy, to the $500 million investment in the Great Barrier Reef, the 2018-19 Federal Budget brought about a lot of new changes. However, the outlined changes to superannuation didn’t receive as much coverage, even though they could have a huge impact on the lives of young Australians.

Also read: Do we need to be worried about Australia’s economic outlook?

What were the super changes outlined in the Budget?

A central theme of the 2018-19 Budget was to safeguard Australians’ superannuation savings against the steep fees associated with having multiple superannuation accounts. The Australian Taxation Office (ATO) will reunite working Australians with their lost and inactive superannuation, which will prevent people with several accounts from having their funds diminished by product fees.

Also read: Aussie housing costs are actually the same as in 1993, but renters still struggle

Recognising that these members are generally younger, lower-income Australians, the government plans to:

  • Protect super balances by capping nominated fees on accounts with balances of less than $6,000 at 3%.

  • Ban exit fees to make it more affordable for Aussies to consolidate their super.

  • Enforce fewer automatic insurance policies to protect low balances from being eroded.

Interestingly, a recent survey of 1,786 Australians that earn super showed that just 37% of generation Y (24-38 year olds*) know their superannuation balance. This is lower than the national average of 42%.

Alarmingly, 13% of this cohort don’t know how to check their superannuation balance, or have never checked their balance.

Do you know your super balance?


Percent of gen Y

Percent of Australians

Yes I know my balance



I have a rough idea of how much super I have



No, I’ve checked before but I just don’t remember my balance



No, I’ve never bothered checking



No, I don’t know how to check




January 2018 survey of 1,786 Australian adults earning super

What does this mean for you?

In regards to the super changes, young Australians certainly come out as the winners, as these new rules will ensure that more of their earnings are retained for their twilight years. If the proposed changes are passed in Parliament, young Australians will be given a greater opportunity to consolidate their super accounts and reap the financial rewards that come from fewer fees.

If you’ve accumulated four different super accounts with separate employers over the years, it’s time to consolidate. Why let your hard-earned savings be depleted by paying fees across different accounts? Consolidating your super account and opting for the most cost-effective one could lead to big savings.

Differences in fees paid for a 25-year-old earning $60,000




Balance at 65 years

Fees paid over 40 years

Super fund 1

(high fees)


  • 4% contribution fee

  • $0 admin fees

  • 2% indirect cost ratio



Super fund 2

(low fees)


  • 0% contribution fee

  • $50 admin fees

  • 0% indirect cost ratio



Difference in fees paid:



Young Aussies should feel empowered by the new super rules proposed by the government, but the onus is on them to make the most of these changes, regularly check their super account and take action consolidate or switch when required.

*Generation Y includes individuals born from 1980 to 1994, aged 24 to 38 years old.