I stumbled upon a few websites that offer a cashback on superannuation by just nominating them as a broker to my super fund. Is it legit? Some of such websites were mentioned on this forum but, upon checking, no longer exist or don't accept new clients. Can someone who tried it share their experience? I'm cautious as to I would lose money in some way by doing that since I'm effectively adding a middleman.
Trailing Commissions with Superannuation
![](https://files.ozbargain.com.au/g/38.jpg)
Comments
How do I see on Canstar which ones have better fees? Their comparison table does show the returns but doesn't show the fees.
Almost sounds like "Cash Rewards" for superannuation funds!
Once upon a time, advisor commissions/fees were a loophole in getting access to super early. The advisor would charge a large fee to the member's preserved account and pay an agreed portion of it to the member as cash.
Once upon a time
So it doesn't work anymore, I'm late to the party?
It might still work actually, but you'll have to find an advisor that's willing to do it. They've tightened up a lot of rules and regulations with the fees over the years and I haven't heard of anyone doing it recently. However, me not hearing about it doesn't mean that it doesn't happen anymore.
I did it quite a while ago when I was younger so that I could pay off a credit card.
Your Share (https://www.yourshare.com.au/) do this. I used them for a number of years before changing funds. Ususally got between 500 - 1000 back each year. They do it as a rebate on the fees.
Super funds paying trail commission will have a total ongoing fee around 2% pa and about 0.5% pa of this will be trail commission (which you will split with the broker).
Or you can find a cheaper super fund with a total ongoing fee around 1% pa and get no cash back (my choice).
Regardless, all trail commissions are being turned off on 1 January 2021 so at best you have 12 months of this super cash-back strategy.
Sounds like a good choice. How does one find out the total ongoing fee %?
The only way you get a rebate is if If your superannuation fund is paying a commission to someone. That is your hard earned retirement money they are taking upfront out of your contributions and for what? . Stay away from scam brokers - they add no value. And get out of your rip-off fund and join a fund such as an industry fund which does not pay commissions . Choose a fund at https://www.industrysuper.com/ Apart from industry funds. some for-profit funds are ok but comparisons show that generally they have higher fees and lower overall performance.
Are you saying that all the industry funds don't pay commissions?
Just choose one of the industry funds with low fees that don't pay commissions. Australian Super, Hesta, etc
Ultimately, it's you that is paying the commission to the broker. The money doesn't appear magically from the sky.
Ultimately, it's you that is paying the commission to the broker.
And depending on how old you are, you're paying them a lot.
$500 now could be thousands more on your super balance over the next 35 years.The money doesn't appear magically from the sky.
Yeah, I suspected so, just wanted to double-check :)
Sounds like you're risking your super earnings for some cashback now.
If you're short of cash, find another way.
If you're not, look on Canstar, find a fund with better fees and return than your current one, move to that and don't assign random people as a broker.