Super fees

Less fees can mean more super

All super funds charge fees and costs, though some less than others. Generally, a super fund with low fees and costs will build your savings faster if it invests in the same assets. You'll need to weigh up fees and costs against other important factors like risk, likely returns and services before you choose a super fund.

What fees and costs can super funds charge?

There are many different types of fees associated with your super fund. Fees are typically deducted from your account on a regular basis at the end of each month or when an action is taken. Super fees can be either a dollar amount or a percentage.

The main types of fees are:

  • Administration fees - General administration fees to cover the cost of operating the fund and keeping your super account.
  • Investment fees - Fees for managing your investment which can vary for different investment options.
  • Indirect costs - Costs paid by your super fund to external providers that affects the value of your investment. Typically these are costs paid to investment managers.
  • Advice fees - Fees for personal advice provided about your super and other investments. Your adviser may also receive fees and commissions for certain investments they recommend to you and these are not included in product disclosure statements (PDS) by the super fund.
  • Switching fees - Fees for changing your investment option within the fund.
  • Buy/sell spread - This is a fee that you may pay every time you make a transaction, including making a contribution, switch and withdrawal. The fee covers some or all of the cost of transactions entered by the fund. 
  • Insurance premiums - The cost of insurance provided through your super fund. Many super funds have a set default insurance option. You can usually choose to lower or increase your level of cover based on your needs.
  • Exit fees - A fee for leaving the fund.
  • Activity-based fees - These fees are only charged if your super fund provides you with a particular service, for example, a family law split fee, where you're charged to split your super following a separation and family law court order.

Smart tip

A 1% difference in fees now could be up to a 20% difference in 30 years.

Check your annual statement to see if you're paying for financial advice. Make sure you are happy with what you are paying. If you are not happy or unsure about any fee, contact your super fund and consider asking how you can stop these fees being deducted.

Super funds may offer other services which may attract special fees. Refer to your super fund's website or read the fund's product disclosure statement for details.

Case study: Gerri chooses lower super fees

Gerri is researching a range of different superannuation funds

Gerri is 30 and earns $50,000 per year as a librarian. She already has $20,000 in her super. After shopping around for another super fund, she changed to one with only 1% total costs and no buy-sell spread which invests in similar assets. Her old super fund charged 2.5% with no buy/sell spread.

By changing to a super fund with lower fees, Gerri will have $81,000 more in her super when she retires at age 65. Her super account balance will be $336,000 instead of $255,000.

Super fees casestudy graph

Assumptions: Calculated using the superannuation calculator, assuming 8% returns, no other fees, no insurance premiums and no changes to salary.

Changes to how super funds report fees and costs

Super funds must report the fees and costs they're charging you in the PDS and in your annual statement.

From 30 September 2017 super funds are required to report their fees and costs differently. Some funds have already started. These changes are designed to make the information you receive more accurate and consistent.

As super funds adapt to the new way of reporting fees and costs you may see changes in the amounts reported in the PDS and your annual statement. This does not necessarily mean you're being charged more, but rather what's being reported to you is more accurate.

In some cases, for example, if your fund invests in private equity or property, the fees may appear higher. These types of assets can have higher fees and costs but may also have higher expected returns over the long term.

If you see changes in the fees reported in the PDS or annual statement you can ask for more information from your fund to understand the changes.

How to tell if you're paying high fees and costs for your super

The only way to know if you're paying high fees and costs is to find out what your super fund is charging you, and compare the fees and costs to other similar funds.

In addition to comparing fees and costs, weigh up other important things including returns, risk and the services the fund provides. Find out more about how to choose and compare super funds.

How to compare super fees and costs

Comparing the fees and costs on your super fund with those of other funds can help you decide on a fund that's good for you. The expected returns on your investment are also important as well as how much risk you are taking. The best way to compare the fees and costs is by looking at the fee example shown in the PDS your super fund has sent you.

Smart tip

MySuper accounts generally have lower fees and costs and can only charge certain types of fees. If you're looking for a low fee option talk to your super fund about whether a MySuper account is right for you.

However, it does not make sense to compare funds that are quite different just on the basis of fees and costs. For example, funds that have a lot of property or private equity may have higher costs but they are likely to have different levels of risk and expected return, compared to funds that have more cash and fixed interest investments.

Some superannuation funds offer platforms for you to choose your investments. These platforms may have lower fees and costs in their PDS because the figures there just cover the fees and costs of the platform. This type of investment might suit you, but it is not necessarily cheaper when you take into account fees and costs that are being charged inside the investments on the platform's menu.

Compare the impact of fees on your super fund.

Superannuation calculator


How much super you have will determine the kind of lifestyle you'll have when you stop working. Choose a fund with low fees and you may end up with a fatter nest egg.

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Last updated: 24 Oct 2018