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Did you know that as of 1 November this year, new super accounts are no longer created every time you change jobs? This means that you’ll have one single default account that follows you for your working life, unless you decide otherwise. If this is news to you, don’t feel bad – you’re not on your own! Following what’s happening with super can be challenging and confusing. At Littles, we not only know how hard you work for your super, but how the important protections that it can provide, like insurance, can help you and your family if you’re unable to work due to illness or injury. You deserve to fully understand what’s happening (without the ‘government speak’ or ‘legalese’). That’s why we’re breaking down the latest developments so you can get the facts. This blog explores what the ‘super stapling’ change may mean for you.
From 1 November 2021, if an employee does not nominate an account at the time they start a new job, employers will pay their super contributions to their existing fund. Employers will access information about the new worker’s existing super fund from the Australian Taxation Office (ATO). The “stapling” change is an Australian Government initiative. It was intended to avoid a situation many of us know well – workers ending up with multiple super funds being eaten up by administrative fees and charges, leaving them potentially worse off in retirement. No more trying to hunt down old super funds!
FYI! This ‘super stapling’ change was part of the ‘Your Future, Your Super’ reform, which also included changes to insurance through super funds. Read our Littles cheat sheet if you want the full picture.
We think super stapling is a positive measure that will help you keep your super balance as high as possible, setting you up for the future. However, there’s some important things that you need to know if you want to future-proof your financial wellbeing.
Many people don’t know that they have insurance through their super, including total and permanent disability (TPD) insurance and income protection insurance. TPD insurance can assist to ease the financial burden if you can no longer work because of injury or illness. It can cover both mental and physical conditions, including chronic illnesses. Different super funds carry different insurance policies. One of the benefits of having more than one superannuation account can mean that you have the benefit of more than one insurance policy, noting that each may offer different levels of cover depending on your injury or illness.
Get informed about your super and the entitlements it comes with so that you’re making an informed choice. It’s your future, after all. You may want to speak to an expert about your superannuation to ensure that your level of insurance cover meets your financial needs.
If you have an illness or injury that prevents you from working, you might be worrying about how you are going to pay your bills and put food on the table. You could be entitled to receive a TPD lump sum, as well as other insurance benefits. Get in touch with Littles for a free super claims check. We can help you understand what you’re entitled to. Know where you stand, and get peace of mind.