Don’t set and forget: do these four things now for a brighter financial future

Dr Angel Zhong, Associate Professor of Finance

Topics: superannuation, ATO, tax time, finances, nest egg

“As tax time approaches, it presents an ideal occasion to reflect on your financial situation and the changes that have occurred over the past year. 

“Additionally, it serves as a timely reminder to prioritise your superannuation health. 

“Your superannuation is your money. Conducting regular health checks on your super is an essential step toward greater financial well-being and freedom, enabling you to prepare for a comfortable retirement lifestyle. 

“More Australians need to avoid the "set and forget" approach driven by inherent behavioural and cognitive biases in decision-making and actively engage with their superannuation to secure a brighter financial future.

“The Australian Taxation Office (ATO) is calling for the public to conduct five basic health checks, including looking at your contact details, super balance and employer contributions, lost and unclaimed super, whether you have several super accounts and need to look at consoliding them, and your nominated beneficiary.

“To safeguard your financial well-being, consider going a step further by conducting a thorough superannuation health check. 

• Assess the performance of your super - Utilise the ATO's YourSuper comparison tool to evaluate the performance of your chosen superannuation fund and investment strategy and compare your fund's performance against relevant benchmarks and explore alternative funds that may better align with your needs.
• Evaluate investment strategies and asset allocation - Consider changes in your personal circumstances that might warrant adjustments to your super strategies. As factors like risk tolerance, liquidity needs, and investment horizon evolve with age, it's important to align your super investments accordingly.
• Understand your investment portfolio - Gain insight into how your super funds are invested. If you have a strong belief in sustainable investing, explore super strategies that align with your environmental and social values, while avoiding those that don't.
• Review fees and insurance charges - Assess the fees associated with your super fund and compare them with those of other funds. Additionally, evaluate the insurance products included with your super to ensure they still meet your requirements.”

Angel Zhong is a finance academic who specialises in empirical asset pricing, digital finance, global financial markets, investor behaviour and the recent trends in retail investing.

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