Hana Anderson switched her superannuation investment strategy after realising she was getting just a 3 per cent return. (Source: Hana Anderson\/Getty) <\/p>\n
A Perth woman is urging young people to take a closer look at their superannuation<\/a> after she was able to boost her balance by thousands with one \u201ceasy win\u201d. New research has found even a few small tweaks now could leave you tens of thousands of dollars better off in retirement<\/a>.<\/p>\n Hana Anderson said she started paying more attention to her superannuation<\/a> after an experience with a past employer where she wasn\u2019t being paid what she was owed<\/a>. The 25-year-old social media strategist told Yahoo Finance this made her realise how important it was to be on top of her super<\/a>, including her investments.<\/p>\n After reading about the difference investment strategies<\/a> could make, Anderson said she was motivated to check her own investments. That\u2019s when she discovered she had been inexplicably placed in a conservative option since she started work at 17.<\/p>\n RELATED<\/p>\n \u201cThe growth on the account was only 3 per cent, which is absolutely crazy. It kind of haunts me that it was that low for many years,\u201d she said.<\/p>\n Anderson ended up seeking advice from her superannuation fund<\/a>, who was able to help her determine which investment strategy was right for her risk tolerance and age.<\/p>\n She ended up switching to her fund’s high growth investment option at the start of last year, which had one-year returns of about 12 per cent and had averaged 10-year returns of 9 per cent.<\/p>\n Do you have a story to share? Contact tamika.seeto@yahooinc.com<\/a><\/p>\n \u201cMy return last year that I received was like $3,500, which was really good,\u201d she said.<\/p>\n Anderson, who is now self-employed, said she has been making extra super contributions<\/a> of $10 a week for the last few years.<\/p>\n Her balance is currently $38,500. In comparison, ATO data found the average balance<\/a> for a 25 to 29-year-old was $24,821 for females and $27,021 for males.<\/p>\n AustralianSuper modelling found an 18-year-old starting work on $56,000 can expect a balance of $556,000 when they retire at 67.<\/p>\n If they decided at 20 to change their investment from balanced to high growth, they could expect to retire with a balance of $641,000. That\u2019s $85,000 more than if they hadn\u2019t taken the action to be more aggressive.<\/p>\n Australian Super’s head of retirement Jacki Ellis told Yahoo Finance even small tweaks could make a big difference to your financial future<\/a> over the long run.<\/p>\n Story Continues <\/p>\n \u201cMost super funds will offer a range of investment strategies. There\u2019ll be a default strategy that if you tick that box and move along, your super fund will select for you. But it\u2019s also possible for anyone to choose how they want their money invested,\u201d Ellis said.<\/p>\n Strategies will usually range between lower growth to higher growth, and can fall into categories like high growth, balanced, conservative balanced, and stable.<\/p>\n \u201cThe key difference there is the amount of exposure to investment risk built into those investment options,\u201d Ellis said.<\/p>\n \u201cThe more an investment might move up and down over time, then typically, investors will get a higher return for those sort of investments over the long term.<\/p>\n “It’s an important thing to think about when it comes to your super and the best time to do that is now. It’s never too early or too late to start planning for your financial future.”<\/p>\n Ellis said it was important to think about your personal circumstances and preferences.<\/p>\n \u201cYou\u2019d really want to be thinking about what your goals are, what your risk appetite is, how long your money is going to be invested,\u201d she said<\/p>\n \u201cFor example, for younger members, because your superannuation<\/a> can\u2019t be accessed until you retire, which is usually a long way off, that really long time horizon gives time for the market ups and downs to even out over time, so you can be more confident that an investment option will achieve its targeted return over the very long term.<\/p>\n \u201cThat time horizon gives younger people the capacity to invest in higher risk options and really enjoy the higher returns over the long term for those investment options.<\/p>\n \u201cThat can add tens of thousands of dollars to your retirement savings<\/a>.\u201d<\/p>\n Ellis said there were a few other \u201csimple things\u201d young Aussies could do today that their future self would thank them for.<\/p>\n Firstly, check you are with a good fund to begin with and look at things like fees, costs, insurance and long-term performance.<\/p>\n Secondly, consider boosting your super through extra contributions<\/a>.<\/p>\n \u201cThat can be as simple as substituting a coffee a week for a contribution into your super fund, or making use of the government\u2019s co-contribution<\/a>,\u201d Ellis said.<\/p>\n \u201cLow or middle income earners might be eligible for a co-contribution of up to $500 a year from the government where they make an after-tax contribution, which is called a non-concessional contribution.\u201d<\/p>\n Thirdly, keep tabs on your money and make sure your employer is paying your contributions correctly into your fund. Most super funds will have apps you can use to check.<\/p>\n Ellis recommended people check in with their super every year. Most super funds will offer free advice at no extra cost, along with online resources for people.<\/p>\n Anderson has urged young people to start talking about super with their parents and their friends.<\/p>\n \u201cIt\u2019s a conversation that seems light years away, but knowing that compound interest<\/a> is the eighth wonder of the world and knowing that the biggest asset that you have is time, the longer that you put it off, the less of a difference you can make for yourself,\u201d she said.<\/p>\n \u201cEspecially if you\u2019re looking to grow your wealth in easy ways without having to work your life away. It\u2019s just such an easy win for young people and they just have no idea.”<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n AustralianSuper’s Jacki Ellis said young Aussies could make a few simple changes that could make a big difference to their retirement. (Source: Supplied) <\/p>\n