What is MySuper?
Since 1 January 2014, employers have been required to make Superannuation Guarantee (SG) contributions into an authorised MySuper product on behalf of members who have not made a choice of fund. MyLife MySuper is authorised by the Australian Prudential Regulation Authority to offer our Aggressive and Balanced investment options as our MySuper products. If you do not select an investment option when you join the Fund, we will invest your superannuation according to our Default Strategy.
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The Default Strategy
The Default Strategy invests your super in different options depending on your age: your super will be invested in the Aggressive option before age 51, and transition into the Balanced option by age 53 (see the table below).
This strategy draws on the benefits of having your super invested in a high-return/high-risk MySuper option (Aggressive) over the long term, then moves your super to a MySuper option (Balanced) that has a medium-to-high return/risk profile as you near retirement.
How the Default Strategy works
|Age||Default investment option|
|Age 50 and under||100% in the Aggressive option|
|Age 51||2/3 in the Aggressive option and 1/3 in the Balanced option
i.e. One third of the money in the Aggressive option at that time will be switched to the Balanced option.
|Age 52||Approx. 1/3 in the Aggressive option and approx. 2/3 in the Balanced option
i.e. Half of the remaining money in the Aggressive option at that time will be switched to the Balanced option.
|Age 53 and over||100% in the Balanced option.
i.e. All the money in the Aggressive option at that time will be switched to the Balanced option.
The switches between MySuper investment options through the Default Strategy will happen automatically, within 3 months of each relevant birthday. Just as your account balance is transitioned from one investment option to another, any contributions received will be allocated to the Aggressive and/or Balanced option(s) proportionally according to your age. You can opt into or out of the Default Strategy at any time.
For ease of understanding, this example assumes there are no changes (e.g. contributions or earnings) to the balance each year.
MyLife MySuper member “Michelle” is 47 years old and currently has a super account balance of $300,000 invested 100% in the Aggressive option. The default investment option changes for Michelle will be:
- At age 51, $100,000 (1/3 of $300,000) will be switched from the Aggressive option to the Balanced option. As a result, Michelle will have $100,000 in the Balanced option and $200,000 in the Aggressive option.
- At age 52, $100,000 (1/2 of $200,000) will be switched from the Aggressive option to the Balanced option. Therefore Michelle will have $200,000 in the Balanced option and $100,000 in the Aggressive option.
- At age 53, the remaining $100,000 in the Aggressive option will be switched to the Balanced option. All of Michelle’s $300,000 will be invested in the Balanced option.
For more information, please refer to our Investment guide.