More than $17 billion is up for grabs. Time to see if any of it is yours?
It might be difficult to imagine losing track of your hard-earned cash, but thousands of people do so every year.
Money from a variety of sources, including bank accounts, shares, superannuation accounts and deceased estates that have lain dormant for a certain period is held by various government agencies, waiting to be claimed.
Inactive bank accounts
If a bank account is left untouched for a number of years (currently three, but due to revert to seven years following a recent change to the law), it is considered inactive. The funds are then transferred from the bank to the federal government where they stay until claimed by the owner. You can ensure your accounts remain active with a deposit or withdrawal of only a few cents every couple of years.
The good news is that, since 1 July 2013, interest is paid on the balance – although you are not likely to become wealthy on the proceeds. The interest rate is based on the consumer price index so, for this financial year, the rate is 1.33 per cent.
You will also receive interest on funds held from unclaimed shares or life insurance.
Lost super accounts for billions
It can be easy to forget about a super account, particularly if you change jobs frequently and different employers pay your super into different funds.
You can end up with a number of super fund accounts with small amounts in each. In fact, according to the Australian Taxation Office (ATO), more than six million people have more than one super account.
Perhaps that is why lost superannuation makes up the majority share of the pool of unclaimed funds, with around $16 billion owing to accountholders.
In a move to reduce the amount of lost super, the ATO has made it easier to consolidate your super accounts into one fund. If you lodge your tax return through my.gov.au, there’s a simple way to check for any super held in your name. Or, you can go directly to the ATO’s lost super website.
Another good reason for consolidating your super funds is to reduce the fees. You pay an annual fee on each super account to cover administration costs, as well as the premium for compulsory life insurance. If you have more than one account, those fees can begin to mount up. However, it may be wise to think carefully before closing an account and losing access to the life insurance.
How to search for unclaimed funds
In many cases, these funds are held by the Australian Securities and Investments Commission (ASIC) but state government agencies, the ATO and the Fair Work Ombudsman are also responsible for certain unclaimed funds.
You can search each of the agencies here to find out if you have some dollars waiting.
Beware of companies and individuals that aim to make money from your unclaimed funds. You may receive a letter or a phone call letting you know that you have funds available. But there’s no need to take advantage of their service when you can search and claim funds online free of charge.
If you would like to know more on finding funds that are rightfully yours, speak to your financial planner, or visit our Find a Planner tool to find one near you. To read more of our blog posts click here.