Below is a list of Australian Superannution related terms
and their meanings.
Active Member
A fund member who is currently receiving contributions to his/her
account.
Adjusted Taxable Income
Adjusted Taxable Income is generally the member's taxable income
for the year, plus the value of any reportable fringe benefits,
tax deductible contributions received and a portion of any employer
termination payments received.
Administration fee
The fee charged by a fund against a member's account to cover administration
costs. Australian Primary charges a low flat fee, expressed as an
amount per week, which can reduce when the member is no longer receiving
employer contributions.
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Assets
The superannuation money invested by Australian Primary on behalf of its
members. Among other things, these may include shares, property, cash
or bonds.
Australian Prudential Regulatory Authority (APRA)
The Federal Government body responsible for regulation and monitoring
of the insurance and superannuation industries.
Award superannuation
Superannuation entitlements which are determined by a Federal or State
industrial award. Occasionally these entitlements may provide entitlements
to employees which are additional to the minimum requirement of the Superannuation
Guarantee.
Complying fund
A superannuation fund that is regulated under the Superannuation Industry
Supervision (SIS) Act and complies with the operational standards specified
in the Regulations.
Contribution fee
A fee charged by some funds as a percentage of all contributions received.
Australian Primary doesn't charge any contribution fees at all.
Death benefit
The amount payable to a member's beneficiaries and/or dependants in the
event of the member's death.
Death insurance (Death cover)
Insurance arrangement whereby the member's beneficiaries and/or dependants
receive an insured amount in the event of the member's death. Australian
Primary offers a choice as to the level of cover, expressed as the amount
of cover per unit of insurance. Insurance premiums are deducted from contributions
as they are received by Australian Primary. It is most important that
you read the detail of your fund's insurance arrangements, and decide
what options, if any, you wish to exercise.
Disability
The current policy defines Disability to mean "the member being unable
by reason solely of illness or injury to attend to his or her occupation
and provided the member is not otherwise gainfully employed or gainfully
engaged in gainful business activity".
Inactive member
A fund member who is not currently receiving any contributions to
his/her account.
Insurance premiums
The sum of money paid to purchase insurance against death and permanent
disability. The premium is deducted from contributions as they are
received by the Australian Primary and is detailed on Member Statements.
A word of advice, do your homework. Don’t just listen to
your mate Bob! Compare industry performance and past results.
Look at the entry fees and exit charges you may have to pay. Review
member benefits such as life insurance coverage. (Will you need
a new medical to get the same coverage you currently have?) Changing
funds could be a good move, or may not improve your returns at
all. The final tip. Whatever you do with your superannuation,
think super carefully.
Australian calculations assume growth of 6.25% and inflation of
3%, which are common industry assumptions.
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