Most Australians have a superannuation account but many do not know what type it is, how the fees are structured, or whether it is the right product for their situation. The account type matters because it determines your fee level, investment options, insurance arrangements, and long-term balance trajectory. This article explains the main categories of super accounts in Australia, who each suits, and what the differences actually cost over time.
Australian superannuation accounts can be broadly grouped into four types: MySuper products (the default, lowest-fee category), choice investment products (non-default options within a fund), retail super funds, and self-managed super funds (SMSFs). Within the first two categories, there are two fund types: industry funds (profit-to-members, not-for-profit governance) and retail funds (commercially operated, shareholder-owned).
MySuper is the regulated default category of superannuation. Any employer that pays super on behalf of an employee who has not made a fund choice must pay into a MySuper-authorised product. MySuper products have regulated fee restrictions — they cannot charge performance fees on the default investment option, and APRA monitors their fee levels and investment returns annually through the superannuation performance test.
The APRA annual performance test (first run 2021, annual from 2022) assesses every MySuper product against a net-of-fees benchmark return over eight years. Products that fail must notify members and are eventually prohibited from accepting new members. As of 2025, all 52 MySuper products passed the test — the prior years' failures and subsequent fund mergers have significantly consolidated the industry, removing most of the underperforming products from the market.
MySuper products are suitable for most workers who are not actively managing their super. They offer diversified default investment options (typically balanced or lifecycle growth), mandatory insurance (death, TPD, income protection in most funds), and competitive fee structures compared to the broader market.
The distinction between industry and retail funds is structural. Industry funds are established under employer-union agreements (though now open to anyone) and governed by an equal representation of employer and employee trustees. Any investment returns after costs go back to members — there are no shareholders taking a dividend. Retail funds are operated by financial services companies (AMP, BT, CBA Colonial, MLC etc.) and return profits to shareholders.
| Characteristic | Industry fund (typical) | Retail fund (typical) |
|---|---|---|
| Governance model | Equal employer/employee trustees | Commercial company, shareholder board |
| MySuper fee range | 0.50–0.85% total investment cost | 0.80–1.30% total investment cost |
| Investment options | 10–30 options typical | 100–300+ options; direct shares often available |
| Insurance arrangements | Group cover, premiums typically lower due to scale | Group or retail cover, premiums vary |
| Default investment option | Usually balanced/growth lifecycle | Usually conservative to balanced |
On average, industry funds have outperformed retail funds on net returns over 10-year periods — partly due to lower fees, partly due to different asset allocation (industry funds hold more unlisted infrastructure and property which had strong returns in the 2010s). Source: APRA Annual Superannuation Bulletin, 2025.
Once you are in a super fund, you can typically choose an investment option other than the default. These are called "choice" products — they sit within the same fund but use a different investment strategy. Common choice options include: growth (higher equity allocation, higher expected return and risk), conservative (higher fixed income, lower return and risk), ethical/ESG screening, single-sector (Australian shares only, international shares only), and direct investment options (index funds or ETFs held within the super wrapper).
Switching to a different investment option within your existing fund does not require opening a new account and does not affect your insurance cover or fee structure. It is the easiest lever to pull if you want to change your super's risk profile without changing funds. Most fund websites allow this online in under 10 minutes.
An SMSF is a super fund with 1–6 members where the members are also the trustees. This gives members full control over investment decisions, including the ability to hold direct property, shares, term deposits, and other assets within the super wrapper. The tax concessions (15% tax on earnings in accumulation phase, 0% in pension phase) apply to SMSFs identically to large funds.
The costs of an SMSF make them unsuitable for most people. You need: an Australian Registered Tax Agent or accountant to prepare annual financial statements and tax returns ($2,500–$5,000/yr), an annual ASIC SMSF supervisory levy (~$300/yr from 2025), investment costs on the assets held, and potentially a financial advisor for strategy advice. Total running costs typically start at $3,000–$4,000 per year. On a $200,000 balance, that is 1.5–2% per year — more expensive than most managed funds. The crossover point where an SMSF becomes cost-competitive with a low-fee industry fund is generally considered to be $500,000–$600,000 in balance.
SMSFs are worth considering if: you have a balance above $500,000, you want to hold a specific asset (such as commercial property used in your business — the related-party transaction rules allow this), or you have sophisticated investment preferences not catered for by retail products.
Australians collectively hold millions of multiple super accounts, many accumulated passively as people changed jobs and each employer opened a new default account. Multiple accounts mean multiple sets of insurance premiums, multiple administration fees, and fragmented balances that each grow more slowly due to lower base. The ATO's myGov portal shows all super accounts linked to your tax file number. Consolidating to a single fund (if the fee and investment profile is appropriate) is typically free and can materially improve long-term outcomes by reducing fees and insurance duplication. Source: ATO SuperMatch service.
Check whether your superannuation fees are competitive and whether your fund passed the APRA performance test.
Check My Super