Understanding Superannuation funds

Quick summary:

Superannuation explained:

1. Superannuation (super) is Australia’s compulsory system for saving for retirement.

2. To receive super, you need to open an account with a super fund.

3. Employers must pay 12% of your earnings into the super fund you choose.

4. When selecting a fund, review fees, investment performance and insurance options.

5. Super grows over time and is generally accessed only when you retire or leave Australia permanently on a temporary visa.

What Is Superannuation?

Superannuation (or super) is Australia’s system for helping people save for retirement. Think of it as an investment in your future that grows slowly while you work here.

The moment you start working in Australia, your employer begins paying a percentage of your salary into your super account. This is separate from your take-home pay, and you can’t access it until retirement (unless you are leaving Australia on a temporary visa).

Super is a long-term investment. The more that goes into it during your working life, the more you will have later on.

How Much Super Does Your Employer Pay?

On 1 July 2025, the superannuation guarantee rate is 12%. This means employers must pay 12% of your ordinary earnings into your super fund.

This is not a small amount, so make sure you understand your new job conditions. When you’re looking at job ads, always check whether the salary is listed as: salary including super or salary plus super.

How Super Works?

Your employer pays your super contributions to the super fund you choose.
Then your super fund invests that money. Over time, those investments (hopefully) grow, giving you more for your retirement. Different funds invest differently. Some go for higher returns with more risk, others focus on stable and steady growth. This is why choosing the right fund matters.

Choosing Your Super Fund

In most cases, you have the freedom to choose where your super is invested. Whether you’re an employee, contractor or self-employed, you can generally decide which fund your super contributions go into.

Here are the three main ways people choose a super fund.

1. Choose a regulated super fund yourself.

These are funds you can join directly. The types most useful for expats are:

Industry funds:
Some are open to everyone, while others are linked to specific industries like construction, hospitality, or healthcare.

Retail funds:
Usually run by banks or financial institutions. They’re open to anyone and often provide a wide range of investment options.

Public sector funds:
Usually only available if you work for the Australian government or state/territory governments.

When comparing super funds, consider things such as:

• performance over the past 5 years

• administration and investment fees

• insurance options

• investment styles (higher risk vs lower risk)

• member benefits and services

2. Use the super fund your employer already works with

Some employers have an existing relationship with a super provider. This is called a corporate fund and is usually only available to employees of that specific employer.

This option is easy because they set everything up for you.
However, make sure to ask questions, such as:

• Is the fund getting a better rate because the employer brings many members?

• How does the fund perform compared to others?

• What are the fees?

Sometimes employer-chosen funds are great, but sometimes you can find something better.

3. Create a self-managed super fund (SMSF)

This is for people who want full control over their investments.
An SMSF works like any other super fund, but you become the trustee, and you’re legally responsible for compliance and investment decisions.

This option gives the most freedom but also the most responsibility. It’s usually not recommended unless you understand the rules very well or have professional support.

What Happens When You Change Jobs?

You don’t need to change your super fund every time you start a new job.

Australia now uses a system called stapled super funds. A stapled super fund is simply your existing super account that follows you from job to job. This makes things a lot easier and helps people avoid ending up with multiple super accounts and unnecessary fees.

If You Leave Australia

Super is designed to be accessed at retirement age.
But if you came to Australia on a temporary visa and later leave the country permanently, you may be able to claim your super back. This is called a Departing Australia Superannuation Payment (DASP).

A few things to know:

• You can only submit a DASP claim after you have left Australia and your visa has expired.

• You can start preparing the application before you leave.

• The payment is taxed at a high rate.

• If you paid Division 293 tax, you may get a refund of that part.

Speak with your accountant if you want to understand exactly how much tax will apply.

Final Thoughts

Super might feel like something far away, but it’s actually one of the most important financial tools you’ll have in Australia. Choosing the right fund and understanding how it works can make a big difference to your future.

If you’d like help choosing a super fund or setting up your financial basics in Australia, Emrelo is here to support you every step of the way.

Not sure which super fund to choose? Use this government tool to compare your options easily.