Whether your teen kids are working or not, you can get them started early in super. You'll want to help them set it up correctly to make sure they're investing their retirement nest egg in the best possible type of fund and account. If they're working, you'll also need to take steps to ensure their super money is paid into your teen's chosen account. Here's what you need to do to make sure everything is set up correctly.
1. Choose the right super fund
Start by helping your teen choose the right fund. In most cases your teen will be able to nominate their preferred fund for employer contributions. Not all super funds are equal and super providers typically offer different features and terms, so you'll want to choose a fund that matches your teen's requirements.
Types of funds
The type of fund is also important to understand. Retail funds are open to any type of member and could offer hundreds of different types of investment options. Industry funds can be restricted to people in particular industries, and they're not for profit. Public sector funds are for government employees, while corporate funds are set up for employees of specific companies.
Comparing super funds
Study the product disclosure statement, and check things like the fees, investment options, extra benefits, performance, insurance options, and service. As you look for the right fund for your teen, you might be able to find a fund that's designed for young people, with minimal administrative fees or even discounted fees
to avoid eroding low super balances.
Choosing the right fund for the longer term
You might be able to find a super fund that's designed for younger people yet has in-built transition features. This could mean your teen has the option of having their super account 'graduate' as they finish studying and enter the workplace. At that stage your child could opt into features - such as using super to save for a home deposit
- that better match their life stage, without having to open a separate account.
2. Set up the super account
Tip: some super funds offer pre-filled standard choice forms to make it easier for members. Check if your fund has one of these before you complete the standard version.
So in either situation, setting up a super account is an easy process. If your teen is working, simply let the employer know by nominating a preferred fund and provide them with your account details. If your teen isn't working but you want to get them started on voluntary super contributions
, you can contact your chosen super fund to join directly.
3. Notify the employer of your elected fund
As noted above, if your teen doesn't nominate a fund, the employer will pay super contributions into a fund they choose. Again, if your teen is eligible to choose their own fund, their employer will provide you with a standard choice form
. You fill this out to notify the employer of your elected fund and to share your teen's super account details. Note you can choose a fund at any time
, but you can only make the employer change funds once a year
Setting up a super account doesn’t have to be a complex process if you know how to best approach it. Always start by choosing the right fund, one that offers the right features and benefits for your child. You can then contact the fund directly to sign up and make voluntary contributions. If your teen is starting work and is eligible to nominate their preferred fund, your employer will provide you with the necessary paperwork for nominating the fund.
At Student Super, we know that setting up a super account can be confusing and difficult. Contact our team today
to get your super account set up.