My name's Tatasha Bamblet. I'm a proud First Nations woman and I'm here to acknowledge country t Glennan Ganya, nian Ar Kaka Yahi and beIN a Waka nian our gay in in Bina, yak rum Jar, Domenyama, Domagahawakaman, dam I, Milan, Mumma bang gadaboma in and now in Waka Ghana yakrum Jar water Nadaa. Hello, beautiful friends, we gather on the lands of the Aboriginal people. We thank acknowledge and respect
the Aboriginal people's land that we're gathering on today. Take pleasure in all the land and respect all that you see. She's on the Money podcast acknowledges culture, country, community and connections, bringing you the tools, knowledge and resources for you to thrive.
She's on the Money. She's on the Money.
Hello, and welcome to She's on the Money, the podcast that's here to help you get your finances on track this year. Welcome back to another episode in our summer STARTI series. I wanted to include this specific episode because when people tell me that they want to get their finances on track, the first thing that they say is usually girl friend I don't have any extra money right now, and honestly, in this economy that.
Is really fair.
Life is so damn expensive. Groceries are wild, rent is wild. Everything honestly feels very wild. But you know, superanuation is one of those rare parts of your finances where you can still put yourself in a better financial position even if you don't have any spare cash sitting around. You're already contributing through your employer. The opportunity here is making sure that that money is actually working as hard as
it can for future you. And this episode is all about those zero dollar tweaks, the stuff that you can do by logging in, checking a few settings, and making sure that your super reflects you, your goals.
And your timeline.
And this is actually part one of a little part two series. So once you've listened to this, I'm actually going to link part two in the show notes so that you can keep going if you want to dive a little bit deeper into superanuation, my friend, If you are feeling behind, overwhelmed, or like retirement is a future you problem, this episode was literally made for you. Super can feel boring, I know, confusing, or even really easy to ignore, but it makes a massive difference over time.
I promise, listen to the episode and you'll see two and few to you, my friend, They're going to be very glad that you cared about this today. So let's get into it now. You guys absolutely loved seeing how you're super compared to other Australians, which I think is really fun because I think so many of us we just google it once six years ago and feel a little bit behind and then never think about it again. Yeah, we actually collected the data from our own community over the last twelve months.
So I thought that we could just start by sharing that.
And I'm really excited about this because I feel like this data is a little bit more gritty, a little bit more comparable to like where.
We are as listeners.
Like if you think about our average listener and the average person or they're not actually the average Australian, Like the average Australian maybe doesn't care so much about their super doesn't care about finance, is probably not trying to
put themselves in the best possible position. So here's a little bit of a snapshot from our shees on the Money community and I've just done by age bands so I've copied what the superannuation companies do so that you could like compare it to your super company if you wanted to later. And we'll obviously use this information to create like a social time so you can go back to it and like see it visually, because it's like not the same as just having it.
Read out to you.
Right, So, if you're between twenty and twenty four in the She's on the Money community, the average is twenty six thousand dollars, and then the median is twenty two thousand dollars. Yes, So just to quickly talk about why I as a statz nerd. I don't know if everybody knows this, but way back when I was at university, I studied statistics. It's one of my mind is because I am just a really big nerd. I always talk about the average and then the median. I actually think
that the median is a better reflection. But most people talk about the average because you go, oh, Vey, what's the average, It's like, well, that's good, But what happens with the averages? You take every single number, So say there's like one hundred people in our sample, there's actually thousands, But say there's one hundred people, you add all of their numbers together and then you divide it by one hundred, so you're getting like the lowest of the low and
then the highest of the high. And what happens with that is if we're all similar, probably not a big issue. But if you've got someone who has you know, they're twenty one and they for some reason have a heap of money in their superannuation and they've got millions. And then you also have people who maybe you know, have never worked a day in their life and they're in
the sample, so they've got zero dollars. We're taking those numbers into consideration, and if I ask you, do you feel like that's comparable to your situation, I think you go probably not. So the median is the number that just sit smack bang in the middle. So it's not like adding them all together and dividing them. It's going, okay, cool, if there's one hundred people, we're going to fifty, Like what is that fiftieth number? And that is the person
that's sitting in the middle of all of that. So they're not the highest of the high, they're not the lowest of the low. That's where a lot of us probably want to see comparable numbers because we go, what's you know, sitting smack bang in the middle. You know, when you think of a bell curve, it's like the bell curve number, it's like the one at the top of that. So often you will see the average is
often higher than what the median is. And that's why I like to work off median instead of an average, because I think an average can not be as accurate anyway. That's a little bit of a statistics side note. If you're between the age of twenty five and twenty eight, the average is forty three thousand, and the median is thirty four thousand. Twenty nine and thirty two average is now ninety four thousand, whereas the median is eighty eight thousand,
five hundred. Thirty three to thirty seven average is one hundred and seven thousand, and then the median is one hundred and six thousand, So we're actually getting a bit closer with that one, but then it does dive away.
At thirty eight to forty one, the average is one hundred and seventy three thousand, five hundred, and the median is one hundred and fifty five thousand, and then between the ages of forty two and forty six, the average is two hundred and thirty thousand, and then the median is two hundred thousand.
But can you see why.
Yes, I probably would prefer if like comparison is the thief of joy, right, Oh, so, like we need to also say that because here I am being like, here's some numbers to compare yourself to, but also don't compare yourself, Like we want to be on track and we want to feel like we can compare ourselves.
But that's where I go.
I'd probably be comparing myself to the media and not necessarily the average usually because it's more accurate, but also it makes me feel better about myself.
Absolutely, as I'm looking at this, I'm like, Okay, there's some numbers that I think I need to get on top of some things.
If you're listening to this and you're.
Kind of like, worry, just know that that's why you're here and we can fix this.
But like it wasn't that cool, because like the people that are listening to this show, they actually just want better for themselves. Like even if you're like, oh, I don't stuck up at all. Think about all the people that aren't even considering that, and the fact that you have so much time ahead of you to like fix that or put yourself in a different.
Position, like what a position to be in?
Exactly, you've already maken the right first step.
I mean, the hardest thing is to listen to me, so like you're already past.
It can confirm, no, just kidding, So what does this tell us?
Okay, So when looking at this information for our community specifically, it says that the biggest jump is in your lefe twenties to early thirties, and if you look at it, supernuation balances actually almost double, like they more than double. And this is the magic of compound interest. So you know how, I'm like, oh, it takes time back, Like you know, you've started your shares's account and you're like investing consistently, but you wouldn't have seen it just double.
But that starts to kick in after ten ish years. So like compound interest, its power is in the long term.
So after ten.
Plus years, that's where you really start to see stuff doubling. And if you think about late twenties, you've probably had nearly ten years of really solid contributions late thirties. You know, not all of us were, you know, contributing for the start of our twenties.
So that kind of makes sense.
Like that data makes sense, and by mid thirties, most people are actually hitting six figures like and that's really normal and that's really exciting. Then in your forties, if we kind of go down the data set a little bit, the gap between average and medium, it really does widen. And I pointed that out when I was reading it out, but that's literally life events. In your forties, that's when we start to see the real impact of you taking
a career break because you've had uneven contributions. So whether you took time off for yourself, whether you took time off to have kids, that's when we really start to see the difference.
And you saw that gap.
Gotch you Okay, God, that's scary. It's really good to see that ease.
But like data is telling us a story, and you know what we can do with stories.
Learn from that absolutely, and this is why soups putting is so important. But that's a story.
That's another conversation and a whole other episode where we will do.
Okay, so if I want to sort my super which I do. What's the first thing I should be doing.
I think I've said it on the show before, and it's not the sexiest way of putting it, but like we're going to do a hygiene check. Ye, like we're just going to clean house, right, So that hygiene check means we log into our superannuation account.
I want you to know your balance.
I want you to know how many fees you're paying and whether you're comfortable with that.
I want you to have a look at whether you have insurance or not.
And if you don't think about getting it, I cannot, Like I cannot drive home the importance of insurances. Don't get me wrong, it's going to look different for everybody. If you're in your early twenties and you're still lucky enough to live at home, you don't have any debts, you probably don't need a lot of insurance. But if you're like me, and you know, I'm thirty four, that's terrifying, and I have a kid, and I have a husband
and have a mortgage. If I wasn't here anymore, I've just lumped a whole heap of responsibility on someone who can't pay for that right, So we want to make sure that that's okay. And then the last thing I want you to look at in your subernuation account is your portfolio type.
So what's your risk appetite?
Are you in a balanced fund? Are you in a high growth fund? Are you in a conservative fund? If so, why have you done their questionnaire? Have you looked at how much impact that can have over the long term of not doing it? Because this is going to give you a really good idea of just or are you starting from? Because like how many of us just have our heads in the sand about super Maybe you know the number because you recently did your tax return, but a lot of us also have no idea.
Yes, that's so true. So once we familiarize ourselves with the numbers, what do we do next?
All right?
So what I want you to do and I have mentioned this tool a number of times on our show before, but I want you to use your super Comparison tool, which is a free tool provided by the Australian government. So it's like not bias, it's not built by a super company, like they're not trying to sell you anything. It's just going to do the job right and to get to it. You go to MyGov, you go to the ATO portal, you click super and it will.
Take you through to your super comparison tool.
You can also just Google it, but personally I like going through the mygove platform because it means you would have had to see what your balance was to begin with.
I'd avoid it.
And then this tool is going to line up all the my super products in the country and it's going to show you a few things.
So it's going to show.
You the net returns are over five and then over ten years. It's going to are you what you'd have if you'd been in each fund with a fifty k balance. It just like shows you the differences and which funds have failed.
The upper performance test.
Okay, to me, that's really important because it's kind of like a hygiene factor. Again, Can we just make sure we're not in a fund that failed, like, because then maybe I would be very very interested in changing.
Yeah.
I can't give you advice and say get out of that fund, because if for some reason aligns with your values, maybe you do you. But like I know that if my fund failed the performance test, I'd be.
Out ah ah ah, But no advice to give it just read between the lines. Okay, let's go on a really quick break because it's a lot to take in it is, and we'll dive back in on the food side.
All right, we are back back and we are talking all things supernuation, and I feel like I have just yapped and yapped and yapped. And the thing that I like with your super comparison tool is it compares like for like options. Like I don't want you to look at different things that are being put in front of
you for marketing purposes. So we know that there are a lot of other comparison websites where if you google like compare the best supers, it's very likely to show you the ones that the superannuation companies are paying for and then not show you the super companies that are doing well but haven't paid for that type of marketing. So don't compare a conservative option either to like a fund with a growth option. So make sure that if
you are comparing, we're just doing apples to apples. So that's why you before went and worked out what your risk profile was, because like, let's pretend beck your growth risk profile. Why are we looking at conservative options?
Gotcha?
Like just filter it by growth, like be like, I know I'm growth, so I'm only going to look at the funds growth options and then I'm going to look at all of the funds and compare their growth options. So I'm getting apples with apples instead of going, oh, well, you know, I compared the Australian super conservative to the UNI super growth, Like what if those aren't actually comparable. They're not on the same page, Like they're for different
people and different things. So if you have done your risk profile and you are conservative, we're only looking at conservative options. If you are high growth, we're only looking at high growth options.
And do you know what that does?
Makes your life six million times easier because less options, less worry.
Absolutely statistically six million times easier.
So I always throw these things around, like where we talk about growth and conservative, So I would say the most common term in the industry when it comes to risk profile because it's like the default is balanced option. So you might have heard of that before where people go, oh, that's the superanuation balanced option, and that I feel like people are attracted to the word balanced.
Yeah feel safe, right, It does feel safe.
Yeah, but it might not be reflective of your goals and your values, right, but that typically only holds or I should say holds not only holds, but that holds sixty to seventy percent growth assets.
What does that mean?
Yeah, okay, if you're pie chart which is one hundred percent, sixty to seventy percent will be shares. The rest will be capital stable assets, which are things like term deposits and cash and bonds.
I see, because if.
You look at a growth option, that pie chart becomes ninety percent shares, yeah, and then like ten percent more stable assets. And like they're different for every single option, So don't go, oh Victoria said that a growth option would have ninety percent. It's actually different per serrounuation company. So the way that and I'm just using these as examples so that you don't go, what are you talking about?
Like if you look at Australian super for example, their percentages in their pie charts are very different to a unisuper or arrest or a host plus. They're like, they're just very different because they all have different methodologies of ascertaining what is like the best breakdown. But on average, I would say growth options like eighty to ninety percent growth assets. Sure, And if that aligns with your values. That's all we looking at.
Okay, got you?
So, Beck, If you came out as growth and hypothetically your growth, your returns might look higher, but that actually just might be the risk profile, not your fund doing a better job. You might go, oh, well, I came out as conservative, and then all of a sudden, I'm saying better returns in the growth one. Well yeah, you're always always, but like the more risk you take on, the higher the returns.
High risk curry war exactly.
So usually when you look at it, it might go, oh, like the you know, conservative portfolio is returning six percent on average, you know, the medium growth is returning like seven or eight percent, and then the like high growth is nine or ten percent?
You got, but why I want nine or ten?
Well, then maybe you need to go back to your risk profile if you don't like the six percent option you came out with, so like.
Work out what works for you?
Sure, sure, okay, and what next?
Okay, so boring, but just understand the fees boring now boring always.
Like it was never good.
And as a financial advisor I used to have to do this forklient so and I would always be like, look, like I didn't like doing it either, because this isn't the sexy part of like super because I should know about my growth. Oh ees boring, But also on those also, I need you to know what you're paying to make sure that you're not getting stooged. And the reason that we care about these things is because it eats into your growth. So like, if you're paying more for something,
you're getting less in return. Or I do say, often pay peanuts, get monkeys. But if you're paying more fees than necessary for the same return as another fund, maybe.
You want to switch, right.
But also I would say that most of the really big superannuation funds fees are average, Like I don't think I've ever seen one that I'm like, oh my god, Like that's so awful. I would never go with that super company because their fees are astronomical. Right, They're all going to be like semi similar, but I want you to understand them. Right, So every single fund will charge two different types of fees on average, So like, please don't again bucket me, but this is what usually happens
in most funds. You've got admin fees and then investment fees, and admin fees cover the administration of your account, and then investment fees are going to be different based during your risk profile, because if you're more risky, we're paying more because we're investing more. If you're more conservative, they're like, well, we're not going to charge you through the no, so something that you're not really using, that's so nice, right,
Well yeah, let's pretend it's nice. So an admin fee, I would say, is usually a fixed It's either a weekly or monthly amount is what they will report on. So it might be like your admin fee is a dollar fifty a week, or it might be seventy eight dollars a year. And then your investment fees, yes, but also like it just is what it is. An investment
fee is usually actually a percentage of your balance. So you know, if they say, oh, your investment fee, and I would say one of the most common is zero point six percent, you go, well, what's that mean fee? It means if you've got one hundred thousand dollars in your cubernuation account, you will pay six hundred dollars each year for an investment fee. Okay, and that would extrapolate out as an ex financial advisor is six percent good bad.
I don't really have an opinion, but if it got close to one percent.
I would be quite wary. Like the closer to one percent it is, the more I'm like, oh, like, what are you doing to add extra value? Because I'd say six.
Percent is pretty normal in the industry, like because people are always like is that good?
Is it bad?
And I'm like, it's all relative, yeah, based on the value you're getting out of something, right, But people love numbers. So if I said, you know, and you're looking at your investment fees, you might go just as zero point six per cent, what's that even mean? I would say that's pretty average. If it got closer to like a full one percent, I'd be like, oh, what are you paying for? Like that's more of a like very active
managed fund fee. And these fees you can kind of compare to like an ETF and they would usually be I would say, relatively comparable. And why are they so cheap? Because that's actually cheap for investment. It's because they're doing it on mass, right, Like they're doing it for hundreds of thousands of people in this fund, so they get to charge you a lower price point. If you went to an individual to do that, it would be much
much more expensive. Also, in the your super tool, it's going to show you a total annual fee, so like that's just the way they report it, but it is coming from those two fees combined. It will show you a total annual fee for that fifty thousand dollars example, or that fifty thousand dollars balance, which I think is
a pretty handy benchmark for each like different fund. And then you know, just again for contexts industry funds, I would say point six percent is pretty normal, but zero point five two point eight I would say is really normal. Sure between that, retail funds can be often more than one percent, which I would be weary of, and I'm consistently wary of because you know, you might go, what's
the difference between point six percent one percent? Victoria, Well, over the long term really comes up thousands of dollars, Like it's not. It might be like, you know, we just talked about seventy eight dollars a year. You might go, whatever, Like it's just coming out of my super I'm not even seeing it. But from little things, big things grow, I should care about this. If it's over one percent, I'm like a bit wary. Yes, I can't give advice, but like, if I'm a bit weary.
Read what are you think? You know exactly exactly shocking question. What comes next?
So the next thing you're going to do is check opra's and your performance test. Now you've probably heard of UPRA before. I think like that gets thrown around a lot, but what the heck is UPRAH. It's the Australian Prudential Regulation Authority or does that actually mean though? So they're kind of like the big dogs, but they're an independent.
So they're an independent and they look at banks, credit unions, they look at building societies, they look at insurers and most members of the superannuation industry and they supervise them. So they make sure that they're doing the right things and basically ensuring that these institutions they maintain financial soundness
is what it says on their website. Just making sure like if they're making money, it's going to the right places, making sure that if they promise their customers something, they actually do it. Making sure that you know, they're stable and they're actually good for their consumers.
So APRA is for us. It's not like HR.
At Work, which is actually right, you know, like a unionization. Yeah, UPRA is actually like holding them accountable.
Cool.
So every single year OPRA runs like benchmarking tests on the mysuperproducts, so they go, all right, comparison time, big job. But if your fund fails, they have to write to you and say hey, beck, So like they don't apologize, which is rude, but they will say, hey, we failed the test. So if they fail at one time, it's a warning, like an official warning. Two consecutive fails means that that fund is not allowed to take on any new members.
Oh how do they? How do you fail?
Like you just like you.
Don't meet your requirements, so you don't meet your obligations. You don't you're not doing what you said you were going to do financially. Sound like I see someone imagine if that was on Tinder. Like I just think that if people on Bumble could get barred, it would.
Be a better life. Oh absolutely for everybody.
Right, And then every single August publishes this full list, So like every single August, I'm.
Really ratten on people.
Oh yeah, like I'm here for the drama. Like, don't get me wrong, I have publicly said.
Before I'm nosy.
I want to know, like I need to know did you fail if you did judging, and then if your fund is underperforming, because that's not very sexy, a short list of alternative funds that actually match your risk profile and show stronger long term nets is going to be suggested.
Oh so that's kind of good.
That's painful.
Then I want you to do those. Yeah. I cannot drive home the importance of insurance. I just can't.
But before moving, I want you to check your insurance cover because sometimes you move and you go, oh, the performance is whack. I don't want to be here anymore. But you had some really good default insurance. And lots of people unknowingly cancel income protection or TPD while they're rolling over, and then they lose it because they can't get it in their new fund because they don't meet
the criteria. So that's where sometimes, even when I was a financial advisor, I would like recommend this is a hypothetical.
I'd be like, oh, beck, I.
Actually want you to have two super funds. Like that goes against a lot of the advice that I give because double fees, whatever, But you're going to keep like a really minimal amount of money in this first super fund that basically doesn't perform. But the reason we're keeping the money there is to pay for the insurances on
that account because we can't get rid of them. And then we're going to put all of our money in this better fund that is actually going to perform, So you would keep both In that instance, the best option, or I would say the safest way to do this is open the new fund first, because just opening the new fund.
Doesn't cancel your old one.
We would hopefully rep the insurance if you need it, and then roll your balance over and update your employer payroll details. Then but if you can't replicate your insurance because it hasn't been accepted or they say, oh, like sorry, we don't offer that, at.
Least you haven't burnt the bridge to begin with.
Yeah, we can actually move super funds without deleting the other one, do you know what I mean? Like, we're not telling the other one that we're already seeing someone new And.
That's okay, cheeky okay.
So once I've checked performance, what do I do next?
All Right?
So I've jumped up and down about this, but so many people, and most people in Australia default to balanced but that's not always right for them. They default to balance because you know, when you're filling out your superforms when you get a new job, it often has these little like italic words below your superannuation choice that say balanced is the most popular option or something to that effect.
And like, if you don't know what you're talking about, which I didn't know what I was talking about when I was doing these before I was an advisor.
I was just like, Okay, well I guess so with that.
Yeah, it doesn't feel like a big decision in that moment, right because like the biggest and hardest thing about that whole process for me was like, well, what is my TFN?
How do I go and find that? Is it in my email?
You know, like I'm not really thinking about it, but that makes a massive difference. So let's talk a little bit about growth versus balanced versus like a conservative account. I want you to imagine the pie chart, because I feel like everyone can imagine a pie chart, right, I love a pie chart. One hundred percent. In a pie chart growth option, it's going to have eighty to ninety percent growth options.
What does that mean?
Eighty to ninety percent of the money in your superannuation is going to be directly invested into shares. Whether that is Australian shares or international shares, it will be different per fund. But then between twenty or ten and twenty percent of that fund is going to be in more conservative assets. So it's going to maybe be sitting in cash, it might be sitting in a term deposit, it might be in a bond. But these are more conservative options.
And now the thing I want you to remember is just the percentages, because I think a lot of people just assume when I say growth assets, you think it's more risky shares.
It's not. It's just a higher saturation of shares.
So if we jump back down and compare it to like the balanced option, like which is the default, and we look at our high chart again, sixty to seventy percent are quote growth assets, So sixty to seventy percent of that is made up of shares. They're the same shares that are in the growth asset. You just hold more when you're growth and less when you're balanced. So like you would just carry more cash if you're balanced and have more of a percentage of assets that aren't
performing as well. And I'm not saying that that's a bad thing. But I think a lot of people assume, oh, if I go growth, the assets.
Are more risky. It's not.
It's exactly the same ETFs. It's exactly the same shares. Like you know if Australian super has picked all of those shares for their portfolios. Well, in the balanced option you get seventy percent and in the growth option you get ninety. Do you know what I mean? So it's more about, well, if you're investing for the future, and you're like, well, I'm going to be in it for thirty plus years, how.
Comfortable are you?
And you need to ask yourself this question, how comfortable are you with thirty percent of your portfolio just sitting in like cash and bonds that perform less. Like I think when you start to contextualize that, people go, oh, growth isn't as scary, And like, I hate the terminology around investing because often it seems scary, right, aggressive portfolio some companies, you know, when.
They call it that, it's like, that's scary.
I don't want to exactly, So we probably aren't going to pick that just because of the naming. Then yes, So when you go back to a growth option higher risk, Like we need to really outline that the more risk you take, the more returns.
You might get.
And more often than not, I would see a growth portfolio being more suitable for younger members who don't touch their super for years. So if you're sixty, I'm probably going to be like, oh, I'd stick clear of that because like, the market goes up and down, and do we want to be part of that. But when you're young, you have time on your site, so I would be expecting more ups and downs along the way, but better long term compounding.
Yes.
So then the balanced option. We've talked about this before. This is usually the default. This is just what you fell into to begin with. And if you've never looked at your super, I can almost guarantee that this is what you're in. Moderate volatility, moderate returns. We're not complaining, you're still getting a return. Is it what you want it to be? It's totally fine.
If you're risk averse, like you might look at it and be like, be I'm comfortable with that. I'm not saying it's bad. I'm literally not.
I'm just saying, let's make sure you have the education so you can make the right decision for you, because in retirement it could mean hundreds of thousands of dollars of difference. But if you've got thirty plus years ahead, you might be leaving some cash on the table, right Okay, okay, And like I don't want you to leave cash on the table. No, Then there's the conservative option, and we're
going back to our pie chart again. But of that pie chart, thirty to forty percent of your money that is in your superannuation will be invested into the share market. The rest is conservative options, so low volatility, low return. I would say it's a much safer option when you're closer to retirement because your risk and reward profile actually
changes over your lifetime. So like right now, Beck, I would assume that you're probably sitting more growth just knowing you, and the closer you get to retirement, you might drop back to a balanced and then you know, when you're sixty or so, you might grow to conservative because it's not so much about growing your wealth whence you're sixty, it's more about conserving it and just like locking it in, loading it in, making sure that it's there for the
long term. So it's I would say safer if you're closer to retirement and you want to protect what you've built. But it probably like and this is stereoti typing again, because I could never give you advice. It's probably not ideal if you're like twenty five and you're going to access your super for thirty five years. Yeah, I see, But the superannuation company is not going to call you up and be like, hey, beg, we saw you picked this.
You sure like.
They're not going to do that, because they're just going to go, okay, well that's what she picked and like what she wants exactly, but you might not know what you don't know. Yes, So sequencing risk kind of matters closer to retirement because being too aggressive close to retirement could mean you go into a market dip and then you have to wait another five or six years before you can actually retire.
And I just I don't want.
That for you, you know, And like even a one percent higher return, so you might go, oh, well, you know, I'll just pick one, Like the more conservative one is like only one percent difference, Like who cares over thirty years, beck, that's thirty five percent of your supernuation balance like that that's a lot. Yeah, but that's thirty five percent more returns that you would have, So you've kind of got a context realize it, because like one percent today, I
don't care if you don't pay me one percent. Thirty five years later, I've lost thirty five percent. And you know what, if I see something that's thirty five percent off, I'm like, that's a good deal.
Absolutely, it's a big chunk of money, right.
And then I also want to talk about the power of time, because we've just like touched on retirement and like maybe not picking a more aggressive option when you're closer to retirement, but if you're younger, like, you've got time on your side, and I can't drive that fact
home any harder than I do. So for example, if you're like, let's say you're twenty five, and you've got a balanced portfolio right now, so you're earning let's just say six percent, but the growth option in the same super fund, so you're not changing funds, you're just like going in and flicking over to growth that's seven percent, So like you would go via, that's not much of a difference, Like kind of who cares over thirty five years. As I was saying, one percent different compounds to thirty
five percent more money. So hypothetically, if you had one hundred thousand dollars, that's the difference of retiring with seven hundred and sixty thousand dollars or one point oh three million dollars.
Wow.
Okay, So like we're not talking like, oh, it's just a couple of dollars, Like these decisions could mean hundreds of thousands of dollars for you.
But you didn't have to contribute anymore for that. Sorry.
Are we not all going into our super and just fixing it or making it reflective of what we want? And I'm not saying, oh, go pick the growth option, but like I am speaking to a community right now, and individuals who you know.
I know you because I survey you.
I am in our Facebook group all the time, and most people that I talk to go, oh my god.
I was in the balanced option.
And then when I finally read up on it, I finally did the questionnaire, I finally, you know, took the test on the super fund website that was free found out I was growth. Like, the amount of times I have that conversation is crazy. Yes, I'm also having that conversation where people will say, oh, well, I was in balanced and then I did it and I was balanced, So like.
I don't know what you were harping on about.
Sure, well, at least you know exactly.
Right you did it.
So risk settings actually do really really matter because the difference between one percent you might go today whatever, But sorry, we're in the.
Middle of cozy lives.
Like we're all trying to, you know, cut back, we're all trying to save money. If you are feeling really stressed about finances right now and the groceries are hard, rents hard, bills are hard. Do you know what you can do something for future you? You can still care about your finances. It just doesn't have to be in saving what's coming into your bank account because that's sometimes too hard.
But pull your finger out, go and fix your super.
Go and fix your Super, please and thank you.
And I'll give you three questions because I know you're about to try and wrap me up because I'm a super Yappa, But I want you to ask yourself three questions. Beck, So I want you to ask, well, how many years until I access Super? Because I I want to know or I want you to know what your preservation age is.
So that's not when you're quote planning to retire. That's when you can actually get your little dirty fingers on that money yeap, without paying tax because, like you know, I could have arguments with lots of people who are like, well you could access you super early?
Yeah?
Cool, but hopefully I'm fit and healthy and don't have to right what age, and it's usually the age of sixty seven? Can I access that completely tax free? And I want you to ask yourself right now, like beck, zoom out.
We're just going to use you as an example.
What would happen if tomorrow you logged into your superannuation account and your balance ha crash twenty percent?
I would I would sit on it, yep, But.
Like what would happen? Would you freak out? Would you like switch to panic mode?
All those things?
But what would happen?
Oh?
I don't know?
But like, how does that impact you financially right now? Right now?
No?
What does it do to your life?
Well?
Can you still afford your bills and your rent and stuff?
Because as you're super right now, have any sway on your finances?
No?
Okay, So I need you to talk to yourself about that and whether if you dove into your super account and found it was down.
Yep, one, Yeah, okay, you're allowed to panic.
Like I have said before on the show ex Financial Advisor, I talk about money all the time. If I log into my share trading platform and I find that my money is down, I get that pit in the bottom of my stomach because do you know what?
People hate losing money? Absolutely? I hate it too.
But then I can zoom out and go, Okay, let's look at the big picture. I still have like thirty years before I'm even retiring. I'm meant to be looking at this like shares or on sale. I'm meant to be looking at this in a different way. And you know what, I'm not saying it's instantaneous.
I'm not like, oh I'm so silly and that I walk off.
I'm still like, yeah, I don't really like this, and I still feel yuck about it. But maybe I'm doing a little bit more research, maybe I'm doing some googling. But ultimately I know that my job is to sit and wait. But if that's something that you couldn't deal with, you need to have a think about that. And then the next one is what is my plan to shift later in life do I have one? Am I going
to be growth until I am sixty seven? Or am I going to you know, go all right, I'm feeling really good about this right now, but if I was like fifty, I probably wouldn't want to be here. They're the times that we're starting to reflect and go okay, cool, Like maybe I would need to revisit my risk profile at that time, but I actually kind.
Of would love.
Like in my perfect world, you're actually revisiting it annually. You're like kind of just doing a like finance health check. You're like, am I in the right place? It should be kind of a tick box exercise. I do it for myself. I redo the survey and I'm like, yeap, what a surprise. I'm still a high growth person, but that might change over my lifetime, and the second it does, I want to make sure that my super and all of my investments are reflective of that.
So those are my questions that you're asking yourself because I do that.
Tried to cap myself with just three, but there's lots of other questions like why am I even here? You know? Okay?
So I feel like this is a really good place to leave it.
I don't want to overwhelm people, so I agree, But I have so much to tell you.
But we didn't even talk about contribution caps.
We didn't even talk about like tax Like there's just a lot to it. But I would actually prefer you're right, I would prefer to like cut it, you ruminate on that, go do all of these things, do your homework, yes, and then we'll come back.
And we'll talk about it, because I'll make another.
Part for a two patter a tuparta. Yeah that sounds great, Thank you Ford. I love it.
Also, I just want to point out I'm not making these stupid episodes. And I think you guys already know this. Maybe you know how sometimes just tell people how to suck eggs. Apologies, but like I'm not making these episodes because I want you to feel overwhelmed. Like I want you to have all of the tools in your toolkit so that you can create your financial future that you deserve on your own. Like these are the things that you know you could go see a financial advisor, but
go you could do it yourself. Like it's not about being the smartest, it's not about like having a finance education.
It's just about logging in.
All of these things on these superannuation websites are written in plain English for us, but we don't know that unless we go there, like and I promise, like this is probably I don't know. Is this is a mean thing to say, But like in Australia, we have to operate on the idea that we are talking to the silliest person in the room. Yes. So, like when you create content, especially finance content, you have to make sure that it's applicable to the person who literally has absolutely
no education on it. And that's the way supranuation companies create content. So if you've been feeling overwhelmed because you're like, I'm going to go to the super company and it's not going to make any sense, promise you it's much easier than you think it is. And like even if you just pick one thing, whether that's like you're deciding to just check your your balance on the MyGov app, or you might pick up the phone and I say this all.
The time, call your super fund. Like Beck used to work at a super fund, I did.
When you pick up the phone to call the super fund, am I talking to the CEO or someone condescending?
Oh, you're took to us.
You're talking to you, and.
Like you can be like, what's my balance, and you can be like, let me have a look for you, Victoria girl, Like people who work at super funds have your back, and like people don't take jobs at super funds if they don't want to be helpful. So anyway call them, because you're already paying the fees on that account, as we talked about in this episode, and that's paying their.
Salaries and free advice. Absolutely, I love that for us.
Or maybe you're like wanting to take it a step further and you're like, I'm going to add some extra contributions because future You deserves that.
You're already going to be in a better spot.
Right And if you haven't already, my friends, please hit follow, tap, subscribe, do all the things, because we've got plenty more episodes that are coming in the future that are going to put future You in the best possible position.
And like I was born to talk about finance. You don't good but also not God's work. This is so self indulgent. I love it.
Imagine just yapping about the things that you love all day. It does sound good, and somehow it's my job.
Yeah, that's so lucky.
She's blessed.
Super is so sexy. Anyway, we'll see you next week. Guys.
Bye,