If you’re new to Australia or starting your new career, you might have heard about something called superannuation, often just called “super.” It might sound complex, but it’s an essential part of working in Australia.

This guide will help you understand what super is and why it’s important. We’ll answer the question, “How does super work?” so you can get the most out of the Perth workforce and thrive.

Let’s get started.

What is Superannuation?

Superannuation, or “super,” is a way to save money for your retirement, which is the time when you stop working.

Think of it like a special savings account that your employer adds money to alongside your regular pay. This money comes from a small percentage of your earnings. Over time, this money grows, and you can use it when you retire, giving you financial support in your older years.

Super is a common practice in Australia and is one of the key ways people save for retirement. It’s designed to make sure that everyone has some money set aside for the future—not just what they save on their own. This is especially helpful because it means you’re not solely responsible for saving every cent for your retirement; your employer helps out, too.

In the next sections, we’ll dive deeper into how super works, how it’s paid, and where you can find more resources to understand it better.

How Does Superannuation Work in Australia?

In Australia, superannuation is a system where money is set aside by your employer to provide for your retirement.

Here’s how it works: When you work and earn money, your employer must put a part of your earnings into your super account. This part is called a ‘contribution’.

As of now, the minimum super contribution is 11% of your earnings. So, if you earn $100, your employer needs to add an extra $11 to your super fund.

This money is then invested by your super fund in different things like stocks, bonds, or real estate, which helps it grow over time.

The idea is that by the time you retire, there will be a good amount of money waiting for you to use. It’s important to note that you usually can’t access this money until you retire, ensuring it’s there to support you in your later years.

How is Superannuation Paid?

Your superannuation is paid directly into your super fund by your employer. You won’t see it in your bank account. This should happen regularly, about every three months, but many employers do it more often, like with each pay.

You can choose which super fund you want your money to go into. If you don’t choose one, your employer will put it into a default fund for you.

Each super fund is a bit different in how they manage and invest your money, so it’s worth looking into which one might be best for you. The fund will send you regular updates on how much money is in your account and how it’s growing. Keeping an eye on these updates can help you understand how your super is doing and if you need to make any changes.

Further Resources About Superannuation in Australia

Understanding superannuation is crucial, but it can be challenging, especially if you’re new to Australia or to the concept of super. To help you navigate this, several resources are available:

• Australian Taxation Office (ATO): The ATO also has a helpful online guide to super.
• MoneySmart Website: MoneySmart is a website managed by the Australian Securities and Investments Commission (ASIC) and provides information and tools to help Australians make informed decisions about their finances.
• SuperGuide: SuperGuide is an independent Australian website that provides information and resources related to superannuation.
• Skills for Education and Employment: If you’re looking to further your education or employment prospects, Centacare’s Skills for Education and Employment program can offer additional support and guidance, including financial literacy topics.

These resources are designed to make complex topics more accessible and provide you with the tools needed to succeed in the Australian job market.

Securing Your Financial Future

Superannuation is a cornerstone of financial security here in Australia, acting as a safety net for your retirement years. While it may seem complex at first, especially for those new to the country or entering the workforce, grasping the basics of how super works is an invaluable step towards financial literacy and independence. Remember, it’s not just about saving for the distant future; understanding super is about taking control of your financial wellbeing today.

If you’ve recently migrated to Australia, Centacare offers programs like the Connecting Up Program, which can help you learn more about life in Australia and provide support in entering the workforce and understanding essential aspects like superannuation. In addition, for those still mastering English,

Centacare’s Free English Conversation Classes can provide a supportive environment to improve your language skills, making financial concepts easier to grasp. Don’t hesitate to contact our friendly team if you’d like to learn more about our courses.

Frequently Asked Questions About Superannuation

Can I choose my own superannuation fund?

Yes, you have the right to choose your own super fund. If you don’t make a choice, your employer will put your super into a default fund. It’s a good idea to research different funds to see which one best aligns with your goals and values.

What happens to my super if I change jobs?

Your super remains yours, even if you change jobs. You can either keep your super in the same fund or transfer it to a new fund that your new employer contributes to. Keeping it all in one fund can make it easier to manage.

How can I check my superannuation balance?

You can check your super balance by contacting your super fund, logging into your super account online, or checking the statement that your super fund sends you regularly.

Is superannuation only for full-time workers?

No, superannuation is for most people who work in Australia, including part-time and casual workers, regardless of how many hours you do. If you’re under 18, you may have to meet other requirements in order to earn super.