How super works: a simple guide to get you started

If you’ve ever nodded along when someone mentions super (without really understanding it), you’re definitely not alone. It can feel like a lot to take in at first. 

This guide answers some of the most common questions in a simple, easy-to-follow way – so you can feel a bit more confident about how it all works and what it could mean for you over time.

What is super?

Super (short for superannuation) is money that’s set aside during your working life to help support you in retirement, when you’re no longer earning a regular income from your job.

That money is put aside into a super fund, where it’s invested for your future.

For many of us, it may become one of the biggest and longest-term investments we ever have. That’s why it’s important to understand the basics and keep track of it.

How is super accumulated?

Your super grows from payments called ‘contributions’. For most people, the main source of super is what their employer pays. These are called ‘employer contributions’ and in Australia, the minimum employer contribution is 12% of your salary.

There are also other ways contributions can be made:

• Salary sacrifice contributions
  Extra contributions you choose to make from your before-tax pay.

• After-tax (personal) contributions
  Contributions made from your take-home pay, either regularly or as a one-off.

• Government contributions
  If you’re eligible, the Australian Government may add to your super through the Government Co-contribution Scheme.

• Spouse contributions or contribution splitting
  Your spouse may contribute to your super or split some of their contributions with you.

Even if you don’t add extra yourself, your employer’s contributions mean your super is growing in the background while you work.

How does super grow?

Triple S is an accumulation scheme, which means your super balance is made up of the following, less fees and costs:

1. Contributions paid into your account

2. Investment returns generated over time

Because your super is invested, returns can vary. Some years may be stronger than others, and there may be periods where your balance goes up and down – that’s a normal part of investing. You can learn more on our Understanding the basics of investing page.

There are a few key things that can influence how your super grows:

• How your super is invested

You get to choose how your super is invested – from high growth options to more stable, lower risk options through to indexed options. Or you can stay in the default option (for Triple S, that’s the Balanced option).

Each option has different goals, timeframes and levels of risk, so it helps to understand how they work.

• Making your own contributions

Employer contributions are a starting point, but some people choose to add more to their super to build their balance further over time. You can give your super a boost by making your own before-tax (salary sacrifice) or after-tax contributions.

• Consolidating accounts

If you have worked outside of the South Australian public sector, chances are you have more than one super fund. By consolidating your super in a single account, you may be able to save on the fees you pay.

Just keep in mind, it’s worth checking if moving your super could affect any insurance cover you have.

When can I access my super?

Your super is designed to support you in retirement, but there are key moments when you can start accessing it.

Here are the most common ways people become eligible (they’re officially referred to as ‘conditions of release’):

• You turn 65 – whether you’re still working or not.

• You reach age 60 and retire or cease work

• You reach age 60 and start a transition to retirement income stream – this lets you ease into retirement while still working.

• You qualify for early access – in cases like severe financial hardship, compassionate grounds, or total and permanent disability.

While most people access their super later in life, there can be situations where earlier access is possible. For example, if you have a Triple S account and you’ve stopped working in the public sector after age 55.

Just note, accessing your super before age 60 could mean paying extra tax on what you withdraw. Withdrawals reduce how much you have later on, so it’s worth considering the tax you may pay and how it could affect your balance before you make a withdrawal.

Do I need to do anything to manage my super?

You don’t need to be an expert to stay on top of your super. But a few simple check-ins can help you feel more connected and informed.

For example, you might:

• Check your balance from time to time

• Understand the investment option(s) you’re invested in

• Join a seminar or webinar

• Keep your contact details up to date

A little more about Triple S

Triple S has been designed with South Australian public sector workers in mind, and it works a little differently to many other super funds.

For example, it’s an untaxed scheme, which means tax on contributions and investment earnings is generally deferred until you access your super. This means more of your money is invested upfront.

Triple S also has different contribution rules compared to many other funds, which can offer greater flexibility when adding to your super over time.

For more details, visit the Triple S page.

Why is super worth understanding?

Super might feel like something for the distant future, but it’s one of the biggest financial assets many people build over their lifetime.

You don’t need to know everything all at once. But understanding the basics can help you feel more confident, ask the right questions, and make sense of your options as your circumstances change. It can also help you make more informed choices along the way, which could make a big difference to your super balance when you retire.

Have a question? Get in touch