On average, Australian workers are each entitled to $10,000 in lost superannuation, according to new research.
Westpac’s Lost Super Report has revealed that huge amounts of superannuation are being lost in unused accounts from past jobs, past addresses or past names.
Superannuation that falls through the cracks in these situations can be recovered – but most Australians are not taking the time to make this happen.
The Lost Super report found that Australians spend an average of five hours per day on social media and entertainment, including an hour and a half on social media alone. Westpac is encouraging Australians to take a few minutes out of this time to investigate and recover their own lost super.
Currently, these lost super checks are largely not being undertaken by Australians – 49% of Australians have never once investigated, let alone recovered, any of their missing superannuation.
Right now, there exists $13.4 billion worth of superannuation owed to Australian workers that has gone missing – an average of $9,762 per person. These billions are sitting in 1.4 million superannuation accounts that can be found if searched for, but which remain inactive.
One of these lost accounts contains over $5 million in unclaimed money.
Based on the average lost super balance of almost $10,000, if a young worker found their lost super now and moved it into an active fund, it could grow to $85,000 by the time they are ready to retire – making the long-term benefits of conducting a super search significant.
That lost money would take the average Australian women 27 months to earn but would only take 5 minutes to find, which is why Westpac is encouraging all Australians to conduct lost super searches immediately.
“$13.4 billion dollars is a staggering amount of real hard-earned money waiting to be found. The average amount oflost super per account is $9,762. Based on an average Australian wage, it would take nearly 2 years of working time to accumulate that amount of super. It’s your money, so I encourage all Australians to do a super search,” said Gai McGrath, Westpac’s General Manager of Retail Banking.
“It takes around five minutes to search for your super.”
McGrath reiterated that the time it takes to conduct a super search could easily be worked into the hours each day we spend on social media.
“Our report found that Australians are spending over 5 hours a day on entertainment activities and browsing social media. I would encourage everyone to take five minutes of this time to do asuper search especially if you have changed jobs multiple times, moved house or changed your name.”
A “lost” account is one that has had no contributions added for five years, or one that has had no contributions for 12 months and also has no current address attached to it.
The issue of lost super is particularly important for women, as women are deeply disadvantaged when it comes to retirement savings. Superannuation balances reflect a lifetime of inequality at work for women – the combination of the gender pay gap and the increased likelihood of taking time out of the workforce to care for children and elderly parents results in women ending up with far less in savings than their male colleagues.
In fact, studies show that the average woman retires with $92,000 less in their super accounts than the average man. For 90% of women, this means the difference between a comfortable retirement and financial insecurity.
Alarmingly, in some sectors such aseducation and the community sector, women in their 50s have 41% less in superannuation than their male colleagues.
So the question is – how do we find lost super and make sure less falls through the cracks in future?
- Keep your details up to date: Always make sure you update your super account when you change jobs, change addresses or change your name.
- Streamline your accounts: If you have multiple super accounts, combine them all into one account in order to maximize savings. Multiple accounts means multiple fees, so streamlining your accounts will pay off in the long run. Your super fund or bank can help you do this.
- Conduct a super search: Use the Australian Tax Officesearch service to find your lost super. All you need is your tax file number to get started.
- Recover your lost super: Once you’ve conducted your search, claim your lost super back from the ATO. Your super fund will be able to help you with this too!