$81,000 Less Super: The Real Underperforming Super Fund Cost
A single 1 percentage point fee difference can leave a typical worker with $81,000 less in super by retirement, according to the ATO’s YourSuper example comparing a lower-fee fund with a higher-fee one.
The number that matters
The central number is $81,000: the estimated extra super balance at age 65 from choosing a fund charging 1% fees instead of a more expensive alternative, in the ATO’s comparison example.
How it quietly costs you
The first money leak is ongoing fees and costs that quietly compound against your balance every year, especially when a MySuper product charges more than a lower-fee alternative. The ATO’s example shows that switching to a fund charging 1% fees can produce $81,000 more at age 65, with the balance rising to $336,000 instead of $255,000.
The mechanism is simple: fees are deducted from the balance before future investment growth is earned, so even modest annual differences become large over decades. AustralianSuper notes that net returns incorporate investment fees, transaction costs, administration fees and taxes, and that comparing net returns over 3, 5 or 10 years shows the impact of fees over time.
The second, compounding trap
The second layer is underperformance in the investment option itself, which means you not only pay fees but also start each year from a lower return base. MoneySmart says members should compare performance over 5 years or more and use the same timeframe and similar investment options for a fair comparison.
That matters because a fund that trails a peer fund by even a small annual margin can compound into a large retirement shortfall over decades; the ATO’s comparison tool is designed to show how different MySuper products stack up on performance, not just fees. In practice, the long-run cost of doing nothing is the combination of lost return plus fee drag, which is why a fund can look only slightly worse in a single year but much worse over a working lifetime.
What this looks like in practice
Sarah, 38, teacher, earns $82,000, has $68,000 in a MySuper balanced option, and is 29 years from retirement. Her concern is that her fund may be charging above-average fees while also lagging the benchmark over 5 to 10 years.
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She discovers that a lower-fee option can mean $81,000 more at retirement in the ATO’s example, compared with a higher-fee path.
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She discovers that comparing funds on net returns matters because AustralianSuper says net return already accounts for investment fees, administration fees, transaction costs and taxes, making it a better apples-to-apples metric than gross return.
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She discovers that the ATO’s YourSuper tool can be used directly in myGov under Super > Information > YourSuper comparison, so she can check whether her MySuper product is behind peers without paying for a comparison service.
The full cost of doing nothing
For Sarah, the combined lifetime cost of higher fees plus weaker performance can easily reach a six-figure retirement gap, and the ATO’s own illustrative fee example alone is $81,000 by age 65. Because the public sources provided here do not give a single official model for a 38-year-old on a $68,000 balance, the most defensible figure is the ATO’s modeled example, which assumes a long horizon to age 65 and shows the size of the compounding effect.
What to do about it
- Compare your MySuper product in the ATO YourSuper comparison tool inside myGov: go to ATO online services, open the Super drop-down, select Information, then YourSuper comparison.
- Log in to myGov and open ATO online services.
- Navigate to Super > Information > YourSuper comparison.
- Check your fund’s performance and fees against the listed MySuper products.
Good looks like a fund that is competitive on both performance and fees versus the pack, not just one or the other.
- Check the fund’s net return on its official product disclosure or performance page, and compare it over 5 years or more rather than one year.
- Find the option you are actually invested in, not the fund’s headline brand.
- Look for net return, fees, and costs for the same time period.
- Compare against a similar balanced option from another fund.
Good looks like consistently strong 5- to 10-year net returns after fees.
- Use the ATO’s super calculator after comparing funds to estimate the retirement dollar difference from switching.
- Enter your current balance, contributions, and retirement age.
- Model your current fund versus a lower-fee alternative.
- Compare the end balance and annual fee drag.
Good looks like a materially higher retirement balance after fees are accounted for.
A myth worth clearing up
Myth: “A small fee difference doesn’t matter because super is long term.” Fact: The ATO’s example shows that a lower-fee fund can leave a worker with $81,000 more by age 65, which is exactly why small annual differences matter over decades.
Sources
Researched 2026-06-24.
Corrections & disclosure: an AI-assisted, human-reviewed guide. Every figure is dated and sourced above. Spot something out of date or wrong? Tell us and we’ll correct it — corrections are noted here and in the video description.
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