A new survey has revealed a "startling knowledge gap" in super, with close to half of Australian students knowing little to nothing about superannuation.
Student Super's survey also found that 42% percent of the polled students were unsure about how much money they had in their super fund.
These numbers are despite 65.5% of students holding a superannuation account.
Student Super polled 3, 566 students nationally in October to arrive at the results. It has just launched the first super fund designed specifically for students, after announcing it in March last year.
"It was an online survey conducted by Student Services Australia, (Student Super's sister company) using the StudentVIP database which accounts for 50% of all university students in Australia. Student Services Australia has been conducting the survey for the last 8 years," a spokesperson said in an emailed response addressing the methodology.
Student Super Professional Super is one of the seven divisions of the Tidswell Master Superannuation plan, which also serves as the trustee for Spaceship Super.
SSPS had $1.3 million in assets under management in 2018.
A super fund for students
Student Super chief executive Andrew Maloney said the lack of awareness that young Australians had about their super funds was a major issue.
"Students can have as many as six different employers before they turn 25. But because they're usually not thinking about their long-term financial goals, they'll go with whatever the default super fund is each time. In fact, 69.6% of students surveyed said they used the default super fund that their employer set up for them.
"What they don't realise is that they're paying duplicate fees with each fund, which can eventually whittle their super down to nothing. That's a whole decade's worth of contributions that could make a real difference to their super balance down the line."
Student Super says it is designed for students who have casual or part-time jobs while they're studying, and that it will charge zero fees for balances under $1,000.
It skips TPD (disability cover) or life cover, which the fund says helps to keep the fees low and removes the possibility of a student's super balance getting gobbled up by fees.
"Regular super funds aren't setup to accommodate the frequent job-hopping and sporadic income of the typical young Australian, whereas Student Super is," Maloney said.
"We've set this fund up to empower students to get the best possible start on their financial future. Joining takes less than five minutes, and using the fully-featured, jargon-free Student Super app, young adults can find and combine any existing funds, let their employer know where to pay their super, and even change how their super is invested," he said.
The fund says that if a student had four casual jobs while studying and picked up a different super fund each time they moved, they could end up paying as much as $1,200 in fees.
This would end up eating up most, if not all, of their super balance. By the age of 65, this $1200 could mean a loss of $26,426.
The study also found that 49% students don't know what percentage of their income is paid into superannuation. A further 30.15 percent got the number wrong.
More than half of all students (59.97 percent) weren't sure about whether they could open a superannuation fund before they got a job. More than 40% were unsure of how much money they had in their super fund while more than 50% didn't know whether their superannuation fund provided them with life insurance.