Risks With Consolidating Super
Written on the 4 April 2011 by G. Dean McKinnon
It can be difficult to keep track of all the super funds you may have collected over the years, so eventually you get around to consolidating them into one fund for easier management of your super savings.
However this strategy may have significant financial risk, if a comprehensive approach to your financial circumstances and objectives are not taken into account.
We recently developed a comprehensive financial plan for a client, which included the consolidation of eight existing superannuation funds. Life insurance would also be required to ensure the financial security of their young growing family, but because the wife was pregnant it would be difficult, if not impossible, to obtain life cover for her.
Fortunately, our comprehensive data audit process uncovered two existing super funds had over $300,000 combined life insurance cover. Our solution was to maintain the existing superannuation funds that had life insurance cover, consolidate the remaining super funds, and roll-over the remaining two funds once the bub was born and their own life insurance policy could be arranged.
Contact us if you require assessment for consolidating your existing super funds.
Author: G. Dean McKinnon