If you haven't checked your super lately, now is the time.
On Monday July 1, 2019 (which is less than two weeks away) the Government's Protecting Your Super package will introduce a new set of laws that is expected to affect more than three million Australians.
The new laws are being introduced to protect members from paying unnecessary fees and insurance premiums. While it's great news in the long run, the immediate implications could pose major financial implications for many.
Those most likely to be affected: people currently living overseas or with dormant superannuation accounts, and mums on maternity leave.
What will happen to my super on July 1?
If you or your employer haven't contributed to your super account in 16 months or more, any life insurance cover that is currently in place will be deactivated on July 1.
If you want to maintain insurance on any account scheduled to be affected, you need to opt-in to the insurance by contacting your super fund or by simply re-activating the account.
If your super account is receiving regular contributions you won't be affected by any of these changes.
Why is the Government introducing these laws?
Multiple super accounts have led to many Australians paying insurance through old or inactive super accounts they no longer need.
The new laws should prevent people from paying unnecessary fees and insurance premiums.
What effect will this have?
The immediate switching off of insurance could be good news for those with dormant accounts — it could result in a slowing down of the draining away of their superannuation.
However, those not anticipating the deactivation could face detrimental losses. The switch-off could mean many losing valuable insurance — such as life, total and permanent disability and income protection cover — that they've been paying premiums on for years.
Inactive superannuation accounts with a balance of less than $6,000 also run the risk of being transferred to the Australian Taxation Office.
If you live remotely and are affected by bad postal and communications services, and have not been able to be reached by your superannuation fund, you could also be at risk of losing your insurance.
What should I be doing?
Most super funds will have reached out and contacted members (via phone, email or text) so if you haven't heard, get in contact with your fund or log into your accounts to see if you have missed any correspondence.
If you have any queries, it's best to contact your superannuation fund(s) directly, and they will be able to check your details and insurance cover. If you need to action anything before July 1, they will be able to help.
You can consolidate your super accounts and check for any lost super online via your MyGov account.
Lastly, spread the word. If you have any friends or family currently living overseas that could potentially be affected by these changes, get in contact with them. The same goes for anyone currently taking time off work, such as new mums, and those yet to consolidate.
For more information on this change to superannuation, visit TimeToCheck.com.au