How does super work?

Your super account is a place to save and invest money while you are working so you have enough retirement savings to live on when it's time.

Your employer will pay a percentage of your salary to your super as a contribution, and your superannuation fund will invest this money on your behalf. Your super works with you to help build a healthy sum to retire with.

If you’re self-employed, you can choose to pay yourself super.

How does your super balance grow?

While you’re working, your super grows by:

• Compulsory contributions from your employer – known as the Superannuation Guarantee, your employer must pay 12% of your ordinary time earnings (SG rate effective from 1 July 2025).^*

• Voluntary contributions. You can choose to make additional contributions to your super at any time, subject to contribution caps and eligibility requirements.

• Positive investment returns – the money made from the investments in your super fund, which is reinvested and can compound over time. 

• Combining super from other funds into one account. This can make your super easier to manage and potentially reduce the account fees^ you pay. Before consolidating, consider whether you may lose any existing benefits, such as insurance cover. 

• Government contributions for those eligible

The aim is for returns to compound over time, as they are reinvested back into assets. Returns can rise and fall over time, but the longer your money remains invested, the more opportunity it has to compound and grow. Investment returns are not guaranteed and past performance is not a reliable indicator of future performance.

When is my super paid into my account?

Since 1 July 2026, your employer must pay your super on the same day as they pay your wages, and, in most cases, contributions must be received by your super fund within 7 business days.

How do personal contributions work?

In addition to what your employer pays in employer contributions, you can also make your own contributions to your super fund too. Eligibility requirements, contribution caps and tax consequences may apply. Consider seeking financial advice if you're unsure what contribution strategy is right for you. 

Voluntary contributions (after-tax income) allow you to add more money to your own super fund from your take-home income, up to a cap. This is known as non-concessional contributions.

This isn't the only way to grow your super contributions. There are also salary sacrifice and spouse contributions. 

Salary sacrifice contributions (which are concessional contributions, just like the Super Guarantee contributions that your employer pays) are where you ask your employer to pay more of your before-tax income into your existing super account.  

Spouse contributions allow a higher-earning partner to top up your super contributions, allowing them to claim an 18% tax offset on contributions up to $3,000 (max offset $540), subject to the spouse income thresholds and relevant eligibility requirements.  

You can find out more about the types of contributions and how they are taxed via the Australian Taxation Office (ATO).

The aim is for returns to compound over time, as they are reinvested back into assets. Returns can rise and fall over time, but the longer your money remains invested, the more opportunity it has to compound and grow. 

What reduces your super balance?

• Super contributions tax that’s paid when money goes into your super account

• Tax paid on your super’s earnings

• Fees and costs deducted from your balance to manage your super and investments 

• Insurance fees (if you have insurance in your super)

• Negative investment returns – if your investments perform poorly, your super balance will decline.

When can you access your super?

You can typically access your super from age 60, if you are permanently retired or after age 65 if still working. You may be able to access your super early in certain financial circumstances (like severe financial hardship), but you'll have to meet strict conditions. You can find out more about the conditions of release for you to access your super through the ATO website. 

Depending on your circumstances, you can either withdraw your super savings as a regular income in retirement, a lump sum, or a combination of both. 

Things to consider when choosing an investment option and fund

The money in your super account can be invested in various options generally ranging from “defensive” through to “growth”. If you don’t select an investment option when you join a super fund, you'll usually be invested in their default investment option. You should still have the ability to choose which investment options you’d like your super contributions invested in after you join. 

Super is generally a long-term investment, so it’s important that you consider your age and investment risk tolerance when choosing an investment option.  Generally, higher growth comes with higher risk. Some people with a longer investment timeframe may choose growth options, while others may prefer lower risk options. The most suitable option will depend on an individual's circumstances and risk tolerance. 

When choosing a super fund, your values are another important consideration, including the types of products, services and activities you want your money to support. Choosing a fund that aligns with your values is a practical way to invest for retirement in a way that reflects what matters to you.