How does super work?

During your working life, it's likely you've come across the term superannuation (or super). Whether you’re just getting started in your first job or retirement is calling, it's helpful to have a basic understanding of super. It might make all the difference to your lifestyle when you retire.

Why should I care about my super?

Superannuation could be one of your main sources of income in retirement and depending on when you decide to retire, may need to support you for up to 20 years.¹ While the Australian Government does offer a fortnightly allowance to eligible Australians who do not have enough financial resources to retire, also known as the Age Pension, this may not be enough money to live a comfortable retirement lifestyle.

Many people don't think about super or retirement because it seems so far into the future, but engaging and understanding how your super works now might help your financial position later.

What is superannuation?

Superannuation is a compulsory way of saving money for your retirement. If you're aged 18 or over and earn more than $450 per month, your employer is required to pay eligible contributions into your nominated super fund that equal at least 9.5% of your salary. This is known as the Superannuation Guarantee (SG).

Some employers, including the Queensland Government, may make higher contributions to your super account. Beyond these employer contributions, there are a number of other ways you can continue to grow your super.

How do I grow my super?

An important part of understanding how super works is understanding how you can make extra contributions to your super fund. These additional contributions could make all the difference to the kind of lifestyle you are able to live when you retire. Some of the types of contributions you can make include:

Finding your lost super is also another simple way to grow your retirement income. With this lost super link, you can locate and consolidate super across different funds², helping you pay less fees and maximise your super balance.

What happens to my super?

A lot of people know that super gets taken out of their pay every week or fortnight, but a lot of people don't understand what happens to this money once it goes into your super account.

Unlike your savings, you can’t access the money in your super account whenever you want – only once you have met a condition of release. Once your super fund receives contributions from your employer, they invest this money according to your chosen investment option.

At QSuper, we aim to provide a wide range of investment options that are tailored to your needs. Whether you’d prefer to let us automatically personalise your investment strategy with our default option Lifetime, or you’d like to take more control with our Diversified and Single Sector or Self Invest options, the choice is yours.

What do I do next?

With a better understanding of how super works, you can take proactive steps to get the most out of your super.

Learn more

1. Based on an Australian retiring at age 65 and living until age 85. Life expectancy based on the information derived from the medium mortality rate assumptions used by the Australian Bureau of Statistics in "3222.0 Population Projections, 2017 (base) to 2066" released 22 November 2018.
2. Before you consolidate your super, you should check with your other super funds if there are any fees or tax implications, or loss of insurance or other benefits.