Rules around choosing a default fund
There are a number of rules around choosing a default fund:
- It must be a complying fund (a fund that meets specific requirements and obligations under super law)
- It must be registered by the Australian Prudential Regulation Authority (APRA) and offer a MySuper product
- The Modern Awards (by Fair Work Commission) specify the super fund/s that an employer can choose to nominate as their company default fund.
The Modern Awards may limit your choices in choosing a super fund. REI Super is a complying super fund and MySuper authorised. It is also named as the main super fund for Real Estate under the Real Estate Industry Award. REI Super is also listed under the Clerical Award.
If your business is not listed under Modern Awards
If your business is not listed under the Modern Awards you can check complying funds through the government’s super fund look up tool.
Tips for selecting the right default super fund for your employees
Consider fees and costs
Evaluate the fees and costs associated with different funds, including administration fees, investment fees, and insurance premiums. Lower fees can significantly impact long-term returns for your employees.
Investment performance
Analyse the fund's investment performance over various time periods, considering their investment strategy and asset allocation. A consistently good performance can indicate a well-managed fund.
Insurance offerings
Review the insurance options provided by the fund, such as death cover, total and permanent disability (TPD) insurance, and income protection. Ensure the coverage is appropriate for your employees' needs.
Member services
Look for funds with good member services, including online account access, educational resources, and responsive customer support to assist your employees with their queries and concerns.
Industry relevance
Consider industry-specific funds if your business operates in a particular industry, as they may better understand the needs and requirements of your employees.
Ethical and sustainable investments: If it's important to your company or employees, consider funds that offer ethical or sustainable investment options aligned with your values.
Employer services
Evaluate the fund's services for employers, such as streamlined contribution processes, reporting tools, and dedicated support for compliance and administration.