Types of superannuation funds

Established and operated by financial institutions, insurance companies and other investment managers, retail funds are available through fund managers, financial advisers and banks. Retail funds are open to everybody, so if you’re likely to change jobs regularly or are self-employed, a retail fund may suit you as it will allow you to maintain the same fund regardless of who your employer is.

Industry funds are generally established by industry groups or unions to provide low-cost superannuation benefits to workers in particular industries. The majority of industry funds are run on a not-for-profit basis. Some industry funds, however, may have limited investment choices.

Corporate funds are established by a particular company (or group of companies) and are generally only open to their staff and/or immediate family.

Often called ‘do-it-yourself-funds’, self-managed super funds are designed for those who want to actively manage their own superannuation. You can include up to three other people, however, they cannot be your employees.

Due to legal and accounting costs, do-it-yourself-funds are generally more expensive to run and many advisers recommend a minimum investment of around $200,000 to make them worthwhile.

When considering the right superannuation fund for you, it’s important to consider the whole package of benefits you’ll receive. It may be worth paying slightly higher fees for more features, investment options or added flexibility. On the other hand, if you don’t use these features, you may not want to pay for them.

Generally, superannuation funds provide a product disclosure statement. These documents include everything you need to know about the fund. It’s worth reading the product disclosure statement thoroughly before making a decision where to invest your super.