Australian workers are being urged to become superannuation detectives as new research reveals millions are losing retirement savings to hidden fees and unnecessary insurance costs. Financial expert Bruce Brammall has identified critical red flags that could be silently draining your nest egg.
The Super Statement Investigation
Your annual super statement contains more than just numbers—it holds clues to potential financial leaks that could cost you thousands over time. Bruce Brammall, author of Debt Man Walking, emphasizes that understanding these documents is crucial for every Australian worker.
"Most people glance at their super statement, see their balance has grown, and file it away," Brammall explains. "But buried in the fine print are potential wealth destroyers that demand closer scrutiny."
Five Cash-Sapping Risks to Uncover
Insurance costs represent one of the biggest hidden drains on super balances. Many Australians don't realize they're paying for multiple insurance policies through their super, including life insurance, total and permanent disability (TPD) cover, and income protection.
"The tragedy occurs when people hold several accounts and are paying for duplicate insurance across all of them," Brammall warns. Consolidating multiple super accounts could save thousands in unnecessary insurance premiums alone.
Investment fees represent another significant concern. Many fund members pay higher fees for investment options that don't deliver superior performance. Brammall suggests comparing your fund's performance against relevant benchmarks and similar products in the market.
Administration fees and indirect costs can also erode your retirement savings over decades. Even small differences in percentage fees can translate to massive amounts over a 40-year working life.
Taking Control of Your Financial Future
The first step to protecting your super is conducting a thorough review of your statement. Look specifically at:
- Insurance premiums and coverage across all accounts
- Investment performance compared to benchmarks
- All fee types including administration and investment fees
- Contribution levels and whether they match your employment
Consolidating multiple super accounts remains one of the most effective strategies for reducing fees and insurance costs. However, Brammall cautions members to check for any potential loss of insurance benefits before closing accounts, particularly if they have pre-existing medical conditions.
Regular super check-ups should become as routine as dental visits. Reviewing your super at least annually ensures you catch problems early and make adjustments to keep your retirement plans on track.
With superannuation being compulsory for most Australian workers, taking an active role in managing these funds is no longer optional—it's essential for financial security in retirement.
