How it works
- Your super includes contributions from your employer and your take-home pay.
- There are 2 parts to your super: the defined benefit component and the accumulation component.
- A formula calculates your defined benefit component, and your accumulation component grows with contributions and investment returns.
- One flat administration fee applies. This fee is deducted from the assets of the DBD pool. See the Product Disclosure Statement (PDF, 2.5 MB) for more information.
Contributions
Your employer contributes 14% or 17% of your salary to super, depending on your work arrangement. When you first join the DBD, you'll automatically contribute 7% of your after-tax take-home pay (called default member contributions) as well. You can reduce or cancel your default member contributions at any time, but doing this will affect your super and other benefits.
Example of your default super contributions
Super contribution made by employer
$14,000 paid into your DBD component | $3,000 paid into your accumulation component
Default member contribution
Paid into your defined benefit component
Your total super contribution
Contribution taxes apply to employer contributions.
Your components
Defined benefit component
Your defined benefit component is calculated with a formula based on your contributions, your age, your work arrangements, and your salary over the last 5 years.
Your contributions to the defined benefit component are pooled together with other defined benefit members' contributions and invested together. Read more about funding the DBD or download The Defined Benefit Division explained (PDF, 492KB).
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See the DBD formula in detail
The DBD formula
Defined benefit leaving service formula is shown below. A different formula may apply if you joined the DBD before 1 January 2015. You can check your benefit statement to see your formula.
Benefit SalaryGenerally, your average salary over the last 5 years you’ve contributedBenefit ServiceHow long you’ve been a DBD memberLump sum factorBased on your age when we calculate your defined benefitAverage Service FractionReflecting your level of employment (full-time/part-time) and any allowances throughout your DBD membership
Average Contribution FactorHow much you’ve contributed to the DBD throughout your DBD membershipExample of the DBD formula
Breanna Dellathy
On the date of calculation
Average salary over the last 5 years: $50,000
DBD membership: 5 years
Service history: Full-time throughout her DBD membership
Age: 40
Member contributions: 7% throughout her DBD membership
Breanna's defined benefit componentBreanna is 40 years old (lump sum factor = 18%) and has been a DBD member for 5 years (benefit service = 5). She has worked full-time since joining (Average Service Fraction = 100%) and her average salary over the last 5 years is $50,000 (Benefit Salary= $50,000).
Breanna has made default member contributions throughout her DBD membership (Average Contribution Factor = 100%).
Breanna’s defined benefit component is:$50,000 × 5 × 18% × 100% × 100% = $45,000
Accumulation component
The money in your accumulation component earns investment returns and grows over time. Changes in investment markets directly affect the amount in this component, so growth can be harder to predict. You can choose how the money in your accumulation component is invested.
Money transferred from other superannuation funds (rollovers) or extra personal contributions are added to your accumulation component.
Inbuilt benefits and insurance
Your inbuilt benefits and insurance cover you for life’s unplanned events. Most DBD members receive these automatically.
While they are similar, different rules and eligibility requirements apply.
Inbuilt benefits
Your inbuilt benefits can cover you if you can’t work due to illness or injury, if you have a terminal illness or pass away.
- Formulas that take into account your work arrangements and salary determine your benefit amount. Your default member contribution rate could also impact how we calculate your inbuilt death benefit.
- You don’t pay premiums – costs are built into the DBD product.
- You can’t change or cancel them.
Generally, a 3-year exclusion period applies to pre-existing conditions. See the Product Disclosure Statement (PDF, 2.5 MB) for more information.
Insurance
Death and total and permanent disablement (TPD) insurance cover you if you can’t work again due to illness, injury, if you have a terminal illness or pass away.
- The amount of cover you have usually depends on your age.
- You can apply to increase or cancel this cover.
- Premiums are deducted from your accumulation component each month. Your premium amount will depend on the type and level of cover you have.
This insurance is provided by TAL Life Limited (TAL).
DBD inbuilt benefits and insurance cover at a glance
| Event | Inbuilt benefit | Insurance |
|---|---|---|
| Temporarily unable to work due to illness or injury |
Monthly payments (including super) for up to 2 years |
Not available to DBD members |
| Permanently unable to work due to illness or injury |
Monthly payments (including super) up to age 65 |
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| Terminal illness or death | A single lump sum payment to you or your beneficiaries |
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All events must meet the relevant definitions in the UniSuper Trust Deed and Regulations.
Fees
| Type of fee | Amount |
|---|---|
| Administration fees and costs | $221 per year1 Administration costs are allowed for in the DBD formula and are not deducted directly from your account. We currently deduct $221 from the assets of the DBD pool to meet the administration costs associated with your DBD account. |
| Investment fees and costs2,4,5 (accumulation component) |
0.40% per year |
| Transaction costs2,3,4 | 0.06% per year |
| Investment switching fee | $0 for the first switch per account each financial year. Each subsequent switch within that financial year is $9.85. |
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Things you need to know
1 Government regulations require this fee to be stated here. It is, however, notional only, in that it is not deducted from your account or benefit when paid. It may be indirectly relevant to your final benefit in that it is deducted from the pool of money used to fund all defined benefits and could therefore be a contributing factor if UniSuper were to be unable to cover defined benefits. See more about funding the DBD.
2 The investment fees and costs and transaction costs shown are indicative only and are based on the investment fees and costs and transaction costs for the year ended 30 June 2020, including several components which are estimates. The actual amount you’ll be charged in subsequent financial years will depend on the actual fees and costs incurred by the Trustee in managing the investment option. Investment fees and costs include an amount of 0.02% for performance fees. The calculation basis for this amount is set out in the product disclosure statement. See more about investment costs.
3 The transaction costs are net of any amount recovered by the buy-sell spread charged by UniSuper.
4 The investment fees and costs and transaction costs for other investment options are set out in the product disclosure statement. They are calculated on the same basis, and paid at the same frequency and in the same manner as the Balanced investment option.
5 Refer to ‘Additional explanation of fees and costs’ in the product disclosure statement.
Choose your super product
Remember, you can only make this choice once. If you do transfer, you can’t go back to the DBD.
Compare the Defined Benefit Division and Accumulation 2
