How to choose a super fund on a working holiday

When you start working in Australia, your employer pays superannuation ("super") into a fund on your behalf — currently 12% of your wages (the super guarantee rate for 2025-26). On a working holiday you might only be here a year or two, so it's tempting to ignore this entirely. But the fund you end up with on day one tends to stick with you — and for backpackers, the right choice is mostly about keeping fees low and keeping everything in one place.

Why fund choice matters more on a working holiday

For someone retiring in Australia, investment returns over decades are what matter most. You don't have decades — you have a short stay and a balance of a few thousand dollars. That flips the priorities completely. Over one or two years, fees and the number of accounts you hold matter far more than which fund posted the best return last year.

It matters even more because of how the trip ends: when you leave Australia for good you reclaim your super through the Departing Australia Superannuation Payment (DASP), which is taxed at 65% for working holiday visa holders. Every dollar lost to fees, or trapped in a forgotten duplicate account, is a dollar that erodes the 35% you actually get back. Minimising fees and consolidating to one fund is the whole game.

The 60-second decision framework

• Pick ONE fund and use it for every job — give the same fund details to each new employer so your super doesn't scatter.
• Prioritise LOW FEES over past returns. On a short stay with a small balance, fees are the cost you can actually control.
• Choose a MySuper product if you don't want to compare options — these are the simple, low-cost default products funds offer.
• Avoid duplicate accounts — a second account means a second set of fees quietly draining your balance.
• Check what insurance you're paying for — many funds attach default life or income-protection cover, and the premiums come straight out of a small balance.

The stapled fund rule — your first choice follows you

Since 1 November 2021, Australia has a "stapled super fund" rule. When you start a new job and don't nominate a fund, your employer asks the ATO whether you already have one — and if you do, your pay goes into that existing fund instead of a brand-new account. The fund is "stapled" to you and follows you from job to job.

For a working holiday maker this is good and bad. Good: you won't automatically rack up a new account at every farm or café. Bad: whatever fund you land in first becomes the default you keep — so a careless first choice (or a fund picked for you because you never filled in the form) can quietly stay with you for your whole trip. It pays to get that first fund right.

How to nominate your fund (and compare them)

Each new employer gives you a Superannuation standard choice form. Write your chosen fund's name, ABN and your member number on it, hand it back, and your super goes where you want it. If you skip the form, the stapled-fund rule (or the employer's default fund) decides for you.

To compare funds before you choose, use the ATO's YourSuper comparison tool, which ranks MySuper products by fee and performance — and via myGov shows your own existing accounts so you can spot duplicates. Moneysmart, the government's money-guidance site, also explains how to weigh fees, insurance and investment options. Both are free and official.

How Tern helps

Tern is built for working holiday makers, so super is part of the plan from day one. We'll let you record the fund you've chosen, keep a planned view of the super each employer pays in, and warn you when a new job looks set to open a second account you don't need — so you arrive at the DASP claim with one tidy fund instead of a scattered trail. (Tern is pre-launch; this is what we're building.)