Do Superannuation Fund Fees Make A Difference?
Wednesday January 21, 2009
Superannuation fund fees can make a massive difference to your total superannuation fund savings over time. Different types of superannuation funds tend to charge different kinds of fees, all of which are beneficial to particular individuals. Someone with a small amount of savings will not benefit from a high fixed fee as much as someone with a larger amount of superannuation fund savings for instance. By choosing a superannuation fund with fees that suit the amount of savings you have, you can save much more of your money which will make you even more money over time.
If you are using an industry superannuation fund, it is quite likely that your fees are based on a percentage of your total superannuation fund balance. For those who have just started, this could amount to a very small amount per year. Those with very large superannuation fund balances, however, may find that any percentage based fee from their fund is taking a significant amount away from them every year.
Some superannuation funds will charge a flat fee, with many such funds being a kind of self managed superannuation fund. While management may not be included in the price, the flat fees mean that no matter how much money you make, you will be charged the same amount. For years with losses, this is not optimal, but in years of substantial gains this can maximise what you make. Those who have a very small amount of savings will probably not benefit from a flat fee, however, as flat fees are usually quite high in comparison to percentage based fees for people with only a small amount of superannuation fund savings.
Please browse our site if you would like to read about master trusts, how a superannuation fund works or many other subjects to do with using a superannuation fund.
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