6 ways to grow your super balance

6 ways to grow your superannuation

1. Choose a low-fee, high-performing fund

Superannuation fees eat into your returns, so the more you pay in fees, the less you'll have left when you retire. Each super fund charges different annual admin fees, investment fees and indirect fees. This can make it a difficult and confusing process when you're trying to compare funds. As a general rule, if you're paying over 1.5-2% of your super balance in fees each year, this is considered to be on the expensive side.

While past performance isn't an indicator of future performance, it's wise to look for a super fund with a long history of strong returns. To do this, take a look at the returns over 5 and 10-year periods, instead of just looking at the past 1 year's performance. The better your fund performs, the higher your super balance will be.

You can compare super funds with our comparison guide, or see our best super fund picks if you'd like a little more help choosing.

2. Salary sacrifice into your super

You can elect to contribute a portion of your salary or wages into your super via the process of salary sacrifice. With this process, the money you elect to send into your super is directed from your income before you pay tax on it. This means that the money will be taxed at the concessional super rate of 15% instead of your marginal tax rate, which could be up to 45%.

Because you're effectively reducing your take-home pay, you'll also be reducing your taxable income in the process. Adding an extra $10-$20 a week into your super when you're young can help you retire with tens of thousands of dollars more. You can learn more about how this process works in our salary sacrificing guide.

3. Make extra contributions

If you don't want to set up an ongoing salary sacrifice arrangement, you can choose to make one-off payments into your fund. Your employer is legally obligated to pay you super as part of the compulsory superannuation guarantee. However, you can also make additional contributions to your super at any point in the year.

There are limits in place around how much you can contribute. Currently (as of July 2024), you can contribute up to $30,000 in concessional contributions (these are pre-tax contributions like what your employer pays and money you contribute via salary sacrifice). You can also contribute another $120,000 a year in non-concessional contributions (these are after-tax contributions which aren't taxed at the lower super rate, but stilll help your balance grow).

Expert insight: Tax-effective super contributions

"There are two ways to contribute to super: concessionally or non-concessionally, each with its own limits and tax treatment. Concessional contributions are pre-tax. These include both personal contributions you make before tax and Superannuation Guarantee Contributions (SGC — the ones the government makes your employer do, is 11.5 per cent of your income as of July 2024, before rising to 12 per cent from July 2025). Non-concessional contributions are made after tax, meaning you have already paid tax on it before you choose to add it to super. There is no tax on this money when it lands in super. The current limit to these contributions is $120 000 per annum."

James Millard

Financial adviser & director, Sufficient Funds

4. Accept more risk

Generally, the greater the risk, the greater the potential return. If you're comfortable, consider switching your investments to a higher-risk option. Most Australians are in the default super option, which is generally a Balanced or Growth option. Take a look at the High Growth option and see if you're comfortable switching to this, instead.

One of the best ways to get more from your super involves adopting an age-based investment strategy. This includes working out how much risk you can afford to take based on your years to retirement. Age is crucial because if you have longer to wait until your retirement, you'll have more time to recover from a major setback and can comfortably accept more risk.

Finder survey: What investment risk level are Australians most commonly exposed to?

5. Start early, make more

Starting to save from an early age can make a huge difference to how much you have when you retire, mainly due to the power of compounding. For example, if someone saved $10,000 a year for 20 years while someone else saved the same amount for 35 years, both earning a return of 6% a year, the 20-year compounding amount would generate $367,856 compared to the 35-year saver which would generate $1,114,348 – more than three times as much.

So, if you're planning to start adding more to your super later on in life, you should consider doing it now instead.

6. Combine your superannuation into one fund

If you have worked several jobs, chances are you have contributed to various funds that you may have lost track of. Take time to contact all your super funds and consolidate your superannuation into one fund. This way, you can stop paying multiple sets of super fees. If you have more than one super fund, read our guide on how to consolidate your super.

Written by

Alison Banney

Editor

Alison Banney is the money editorial manager at Finder. She covers all areas of personal finance, and her areas of expertise are superannuation, banking and saving. She has written about finance for 10 years, having previously worked at Westpac and written for several other major banks and super funds. See full bio

Alison's expertise

Alison has written 625 Finder guides across topics including:

• Superannuation
• Savings accounts, bank accounts and term deposits
• Budgeting and money-saving hacks
• Managing the cost of living