At a glance
- Without meaning to, many of us are probably making these superannuation mistakes.
- From forgotten accounts to duplicate fees, seemingly minor oversights can reduce your retirement savings over time.
- Reviewing your investment option, insurance cover and binding death nomination can help ensure your super still reflects your needs.
- Think long term, not short term.
- Have more of your superannuation and retirement questions answered in Money Matters, available now.
Superannuation isn’t something most people actively manage day-to-day; as a result, we are likely making some common mistakes.
It tends to sit in the background while life gets busy. The problem is, when it’s ignored or treated as ‘set and forget’, small issues can quietly chip away at your balance over time. And because super is long-term, those small issues can add up in a big way.
Here are six of the most common mistakes people make with their super.
1. Losing track of it
One of the most common issues is losing track of where your super is.
This can happen when you change jobs and don’t actively consolidate old accounts, or if you move house or change email and forget to update your details with your super fund. Over time, super can end up spread across multiple funds that you no longer actively think about.
The good news is it’s getting harder to lose track thanks to “super stapling”, introduced in 2021. Your existing fund now generally follows you when you change jobs, instead of a new account being created each time.
Still, plenty of super slips through the cracks. Older accounts, earlier jobs, or gaps in stapling rules can leave behind forgotten balances. That’s why, according to the ATO, almost $19 billion was sitting in lost and unclaimed super across more than seven million accounts as of June 30, 2025.
When super is lost or forgotten, it’s not being reviewed for fees, performance or insurance. Over time, that can quietly eat away at your balance and leave you with less money at retirement.
The upside is that it’s relatively easy to track down. You can find any missing super through your MyGov account linked to the ATO, which shows all accounts held in your name, including ones you may have forgotten about.
2. Multiple accounts and unnecessary fees
When super gets spread across multiple funds, the real cost isn’t always obvious.
Each account typically comes with its own set of fees – administration and investment fees, and sometimes insurance premiums. Even if each one looks small, together they can quietly reduce your long-term balance.
Another issue is visibility. Instead of one clear picture of your retirement savings, you end up with multiple statements, different performance results and less control over your overall position.
Consolidating your super can help reduce duplicate fees and make it easier to manage everything in one place.
But it’s important to check what you might be giving up before combining accounts – for example, existing insurance cover (which may be cheaper or more tailored), different fee structures or investment options that may not be available in your new fund.
3. Not having a binding death nomination
Super doesn’t automatically form part of your will in the same way other assets do, which is something many people don’t realise.
Without a binding death nomination, your super may not automatically go to the person you expect. Instead, the fund trustee may decide how it gets distributed.
That can mean delays and confusion, and your super may not end up going where you thought it would. Setting up a binding death nomination is relatively simple. You can usually do it through your super fund’s online portal or by completing a form.
It usually lasts three years and needs to be renewed, and you can only leave your super to certain dependants or your estate – not just anyone. It’s worth checking the rules with your fund.
Also, it can be a good idea to review it whenever your circumstances change (for example, getting married, separating or having children).
“Super doesn’t automatically form part of your will in the same way other assets do”
4. Not checking insurance inside super
Most super funds include insurance by default – typically life cover, Total and Permanent Disability (TPD) and sometimes income protection.
The issue is that many people don’t check whether that cover still suits their situation.
Cover may be too low – especially if you’ve taken on a mortgage or have children – or you could be paying more than you need to if you have multiple accounts with separate premiums.
Insurance can also change without you realising. It may be reduced or lapse if an account becomes inactive or is consolidated, which can leave you unintentionally underinsured.
It’s also worth checking how your job is classified. Insurers often group roles as white collar or blue collar, and that can affect premiums, policy terms and how claims are assessed.
If your job has changed, or the classification doesn’t match what you actually do, you could end up paying more than you need to or holding cover that may not suit you when you need it.
5. Not checking investment options
Many people never actually choose where their super is invested – they just stay in the default option.
That’s not necessarily a bad thing, but it might not be the best fit either.
Different investment options come with different levels of risk and return. For example, conservative options aim for stability but lower growth, while growth options aim for higher long-term returns but with more ups and downs.
The problem is, your default option might not match your age, goals or comfort with risk anymore. What made sense at 25 might not make sense at 40 or 55.
Checking in every now and then can make a meaningful difference over the long run.
6. Switching funds too often or chasing performance
It’s natural to want the best-performing super fund, especially when it’s so easy to compare the options online. But chasing short-term performance can actually work against you.
Super is a long-term investment. A fund that looks like a top performer one year might not stay there the next.
Moving too often can mean locking in losses, missing the recovery or making decisions based on what’s done well recently rather than what suits you over the longer term.
A better approach is usually to choose a fund that suits you, set it up properly and check in on it from time to time, rather than looking for short-term returns. That way you’re being proactive but not too reactive.
This article originally appeared in Money Matters by The Australian Women’s Weekly. Purchase here.
Information is correct at the time of writing. Any advice provided is general in nature and does not take your personal circumstances into consideration. Readers should seek their own financial advice.
