Despite it being easier than ever to track and find – and despite years of public awareness campaigns to that effect – as many as half of all Australians have lost touch with or not claimed super worth up to $16.8 billion.
That’s hardly news to most of us. Nor is it a surprise to learn that there’s also a substantial amount of ‘missing’ money floating around Australian banks in the form of old savers’ accounts and unclaimed life insurance.
What’s different as of the 1st of July, and that you might not have noticed, is
- that ASIC is now claiming these untouched accounts holding up to $2000 (increased from $200), and;
- that ASIC has committed to paying interest on these funds, (if and when they’re reclaimed by the original owners), although only at the rate of CPI, and the interest in not applied retroactively beyond the start date
Some of the lazier among us might be tempted to let our micro-super accounts from first few jobs fall into government hands and grab them later. If you’re carrying five or six accounts with various different funds from your days as a bartender or human billboard, all worth a few hundred dollars, it could seem like an easy option to let them ‘lapse’ and use ASIC as a management service. However, it’s not a smart move.
Although it’s relatively painless to locate and pull your funds back from ASIC, it still takes time and effort and there’s substantial opportunity cost. Given that a strong super fund will give you a long-term average rate of return well over that of the average CPI your best bet would be to merge your older, dustier super funds into your current one.
Also worth noting is that it’s significantly easier for ASIC to grab these unclaimed accounts than you might have expected. Accounts are rated as untouched after the passage of three years since the last transaction, not seven as it used to be – and a transaction involves the withdrawal or deposit of at least 5 cents, (so accruing interest will not keep you safe).
Financial institutions (that accept deposits) have to report by March 31 on accounts that have been untouched for 7 years and by May 31 on accounts that have been untouched for 3 years – so you’ve got a little time to sort things out.
It might be worthwhile having a look even if you don’t think you have any unclaimed super, particularly if you’ve ever changed your name or have had multiple changes of address. Australian Accountants can help you find and manage your super funds; call us at 02 9415 1118 to find out how.