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The Measures You Can Take To Protect Yourself And Your Super From Scammers

Your retirement nest egg is a prime target for scammers, as a significant amount of funds are placed every day into it by Australians. These scammers may pose as your superannuation fund, financial advisors or even as the ATO.

Some of the most recent scams involving super that have been noted include a cryptocurrency trading scam (August 2021) and a Super Managed Super Fund (SMSF) phishing scam (May 2021).

Cryptocurrency Trading Scams 

These scams usually involve offers on highly profitable trading systems based on individuals expertise or through algorithms that they have developed. You may be promised high returns with low risks, and be faced with a ringing (but fake) celebrity endorsement that attempts to enhance the legitimacy of the scam. The scammers then request the transfer of funds into a trading account, either via a crypto wallet or bank account and provide you initially with small returns that are sourced from other victims’ initial deposits.

They will then claim problems with making withdrawals and cut off contact.

Super Managed Super Fund (SMSF) Phishing Scam

If you have been targeted by a scam such as this, chances are that you have been cold-called or emailed by random individuals/organisations who are posing as financial advisers or representatives of an SMSF.

Scammers may promise you high returns if you move all or some of your super to an SMSF, and use email, web and company information that looks real to capitalise on their legitimacy. They will also register actual business and bank accounts in your name to appear genuine, and request for personal information to be provided so that they can complete the transfer (such as identity documents). Your super will then be transferred out of your account and into theirs once they have access.

Superannuation and its protection, therefore, are of paramount concern to those who are looking at living off of it for the future.

So what are some of the ways in which you can protect yourself and your superannuation from potential scams?

You can get acquainted with the formula for many of these scams. Often the approaches of scammers can be sloppy, with emails that contain obvious errors, or sophisticated with legitimate business names, spelling and official-looking addresses. They’ll often claim:

  • They’re from your super fund, bank or a government agency.
  • Ask for personal information.
  • Offer help with withdrawing your super. This might be as one lump sum to an account that doesn’t belong to you, or as a withdrawal to an SMSF

There are some straightforward steps you can take to protect yourself from super scams.

Know The Rules Around Superannuation

  • Becoming familiar with the rules surrounding superannuation will alert you against scams that make false claims e.g. offering early access to your super
  • Keep up to date with the relevant authorities and so that you don’t put in your personal information into the wrong websites – always check that relevant institutions have verified their authenticity!

Keep Track Of Your Balance And Account Details

  • Check what your super balance is on a regular basis – if you notice something that doesn’t quite look right then immediately get into contact with your super fund and ask them about what could have happened.
  • Every once in a while, check that your super fund has the right postal address, email address and mobile number – this will help them get in touch with you if they spot any suspicious activity.

Reduce And Restrict Attempts At Identity Theft

  • Taking the steps to stop identity theft will also help protect your super
  • This does not have to be all too complicated e.g. shred important documents, change passwords every few months, etc.

If you’re someone who often finds it difficult to make large lump sum payments for goods or services, you may want to consider looking into “Buy Now Pay Later” services.

Buy now pay later essentially means that, rather than paying in a full lump sum payment for a product or services rendered, there may be an option to pay through instalments of a certain amount over a set period to make the sum of the full amount in total. This method should allow you to pay in full for the product or service without overly straining your finances – you pay back what you can, as agreed upon when you begin the buy now pay later service.

Some popular buy now pay later services include Afterpay, Zip Pay, Brightepay, and some credit card networks such as  Mastercard and Visa, can offer buy now pay later arrangements.

Though it can be a convenient, immediate solution, it may be challenging to juggle the necessary repayments with other financial commitments. It’s not always the most appropriate method for people, and you should bear in mind your situation and ability in paying back the amounts. 

Before you sign up, keep in mind: 

  • It becomes easier to overspend with buy now pay later services, so know your limits on what you can and can’t afford.
  • You will be charged fees and costs to use the service, which can add up to a princely sum in and of itself.
  • Keeping track of your payments can be tricky if you’ve signed up for multiple services.
  • It could affect your loan applications for a car or mortgage as lenders consider buy now pay later spending just as much as your credit score.
  • Late repayments can appear on your credit report, which affects your ability to borrow money in the future.
  • Layby can be a cheaper alternative to buy now pay later, with no account-keeping or late fees to consider

If you are someone who could make use of BNPL services, you may wish to:

  • Ensure that when using the BNPL service, you stick to a set limit on what you spend so that you can comfortably pay it back later. 
  • Aim only to have one BNPL account at a time to manage payments through, rather than confuse yourself with multiple payments across different providers.
  • Always budget for bills, loan payments and BNPL payments, and 
  • Rather than use your credit card for payments to your BNPL account, consider linking to your debit account instead.

If you would like assistance in planning your financial future, help in managing your budget or some friendly advice, see us for a chat about what we can do for you.


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