Default member contributions are super payments made on top of the contributions your employer makes for you. They apply to Defined Benefit Division (DBD) and Accumulation 2 accounts.
The default amount is 7% (after tax) of your salary, which goes into your super automatically. You can change the amount you contribute, but different rules apply depending on the type of account you have.
Example of your default super contributions
As a Defined Benefit Division (DBD) member, the default total contribution is 24% of your salary (if you get 17% employer contributions) or 21% (if you get 14% employer contributions). This example shows the default arrangement for a DBD member with 17% employer contributions.
If your total annual salary package was $117,000 (incl. super) for the year, your super contributions would look like:
$17,000 total: $14,000 paid into your defined benefit component, $3,000 paid into your accumulation component.
$7,000 total: this is paid into your defined benefit component.
$24,000: this is the total contribution. Taxes apply to employer contributions.
Defined Benefit Division accounts
Your level of default member contributions factors into the formula that calculates your defined benefit component. Changing your default member contributions will impact the outcome of your formula.
Learn more about the DBD formula
What you can change
You can reduce your contributions or change them from after-tax to salary sacrifice (before-tax) contributions.
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Reducing your default member contributions
By default, you contribute 7% (after tax) of your salary into your defined benefit component but you can contribute less. There is a range of pre-determined rates to choose from.
If you do reduce your default member contributions, you can't increase them again later and your defined benefit will be reduced. You can still add extra money with salary sacrifice or after-tax contributions, but it can only go into your accumulation component.
If you receive 17% employer contributions and reduce your default member contributions, the 3% that goes into your accumulation component will go to your defined benefit component instead.
Reducing your default member contributions will affect your super
- You’ll have less money to retire on because you’re contributing less. Remember, changing your contributions affects the outcome of the formula that determines your defined benefit balance.
- If you reduce your contributions when you first join us, this may impact your insurance cover. See the DBD and Accumulation 2 PDS (PDF, 2.5 MB) for more information.
- Your inbuilt death and terminal medical condition benefits may be lower. Your other inbuilt benefits won’t change.
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Change to salary sacrifice contributions
Your employer may be able set up a salary sacrifice arrangement so your default member contributions are paid from your before-tax pay.
Doing this could mean you may pay less tax as these contributions are taxed at 15%, which is generally lower than the income tax that applies to after-tax contributions. There are other effects, like contributions caps, to consider.
Speak to your employer about whether they can set this up for you.
Accumulation 2 accounts
When you switch to the Accumulation 2 product, you’ll continue to make the same contributions you did in the Defined Benefit Division (DBD)
What you can change
You can reduce or increase your contributions at any time or change your contributions from after-tax to salary sacrifice (before-tax) contributions.
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Reduce or increase your contributions
Accumulation 2 gives you the flexibility to change your default member contributions at any time. Choose from our pre-determined rates or set your own.
Reducing your contributions will affect your super
- You’ll have less money to retire on because you’re contributing less.
- You’ll need to ensure you have enough money in your account to pay any insurance premiums.
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Change to salary sacrifice contributions
You may be able to ask your employer to pay your default member contributions from your before-tax pay (also known as a salary sacrifice arrangement).
Doing this could mean you may pay less tax as these contributions are taxed at 15%, which is generally lower than the income tax that applies to after-tax contributions. There are other effects, like contributions caps, to consider.
Contribution rates
You can choose from predetermined default member contribution rates. The available rates depend on whether you receive 17% or 14% employer super contributions. Remember, if you're a DBD member, you have to choose from one of these rates. Accumulation 2 members can choose any level of default member contributions.
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Rates for 17% employer contributions
Available rates if you receive 17% employer contributions After-tax contribution level Before-tax contribution level 7.00% 8.25% 4.45% 5.25% 4.00% 4.70% 3.00% 3.55% 2.00% 2.35% 1.00% 1.20% 0% 0% -
Rates for 14% employer contributions
Available rates if you receive 14% employer contributions After-tax contribution level Before-tax contribution level 7.00% 8.25% 6.55% 7.70% 5.55% 6.55% 4.55% 5.35% 3.55% 4.20% 2.55% 3.00%
How to change your default member contributions
Before changing your default member contributions, we recommend you take the time to consider your options. You can speak to a super consultant or make an appointment with a financial adviser.
To choose a pre-determined contribution rate, complete the Default member contributions form (PDF, 186 KB) and give it to the superannuation officer at your work.
To choose your own contribution rate (Accumulation 2 accounts only), speak to your employer about how to arrange this.
Read more about your options for your default member contributions in the product disclosure statement (PDF, 2.5 MB).
If you're not sure which account you have, you can check online or contact us.