Help your new team member choose their super fund
When an employee joins a company, they are required to pick their own super fund and some tend to fail in choosing. As an employer, it is important to pick a default fund or employer nominated fund if this happens. To help you choose the right super fund for your employees, here are some points you should examine and focus on.
When to pick?
An employee chooses a super fund in which their super contributions enter, and as an employer, you need to pay into one super fund for each employee. Adopting the standard choice form provided, an employee is able to nominate their desired super fund within 28 days of joining a company.
There are cases where employees don’t fill in these forms or are confused in which super fund to choose and fail to pick. If that’s the case, try checking the employee’s industrial reward to make sure if a default fund is not registered, if so, the employer has the freedom to register them to the default fund or employer nominated fund.
How to compare?
According to the Australian Securities & Investments Commission, these things are important to compare when picking a default or employer nominated fund.
Some funds have very poor insurance policies, thus, comparing how effective the insurance benefits your employee would be getting could help your company from taking out extra charges due to poor insurance coverage. Some employees like part-time and casual workers have sufficient coverage, pay attention to these issues in order to protect your employees.
Some companies neglect research, without comparing different funds and its aspects. On some cases, employers end up choosing the best fund performer from the year before. Therefore, try picking a fund that has performed well for at least 5 years as these funds usually uphold the expenses needed.
Find out how much your employee would be taking out from their pockets to pay for the funds, lower fees are usually more essential but try comparing if they are getting what they are paying.
– Investment Option
Identify the different investment options the fund offers and correlate them with your employee’s needs. Some funds possess diversified investment strategies with different risk, returns, and fees. Try considering how your employee would benefit from these investments and whether they can make adjustments at a later stage.
– Extra Benefits
Check whether the funds offer other benefits like seminars, workshops and educational advice. If they do, this could help your employee in developing more skills.
Be aware of this!
There are funds that offer employees with incentives such as holidays, free tickets, and discounts on goods and services. Particular inducements are considered illegal and could cause you trouble. Not only this, some funds trick you into signing an agreement to be a participating employer that would cause you to pay super payments on a monthly basis.
The above-mentioned are the fundamentals of deciding the right super fund for your employee. Make sure the default funds would be benefiting for both your employees and you. Focus on what’s best for your employees and follow these steps to electing the right super fund.