How super grows over time¶

Your super balance grows in two ways. Money goes in — mostly from the contributions your employer pays. And the money already in your account earns a return, because your super fund invests it for you.

Over a working life those two things add up. Small amounts, paid in again and again and left to grow, can build into a much larger balance by the time you retire.

In one line

Super grows from the contributions paid in plus the investment earnings on your balance — and over many years, compounding makes those earnings add up.

Why this matters¶

Super is often one of the biggest savings most people ever build, yet it grows quietly in the background. Understanding how it grows helps you see why time matters, why fees matter, and why even small extra contributions can make a difference by retirement.

What you will learn¶

The two ways a super balance grows
How compounding builds a balance over time
How fees and extra contributions affect the final amount

Understanding the concept¶

There are two engines behind a growing super balance.

Contributions are the money going in. For most people this is the regular amount their employer pays. You can also add extra yourself.

Investment earnings are the returns your super fund makes by investing your balance. Moneysmart explains that your super money is invested by your fund so it grows over time. Returns are not guaranteed and they go up and down from year to year, but over a long working life the balance generally builds.

The powerful part is compounding. Moneysmart describes compounding as earning returns on your returns. Each year, any earnings are added to your balance, and the next year's earnings are worked out on that new, larger balance. Left alone for many years, this snowball effect can make a big difference — which is why starting early and leaving super to grow both help.

Two other things shape the final amount:

Fees. Super funds charge fees. Moneysmart notes that, for the same investment performance, lower fees generally leave you with more at retirement, because less is taken out along the way.
Extra contributions. Moneysmart explains that even small, regular extra amounts can add up over time, because they also get the benefit of years of compounding.

For accountants & bookkeepers

The two levers Moneysmart highlights are contributions in and net investment earnings (returns after fees and any tax within the fund). Earnings inside super are generally taxed at a concessional rate, which Moneysmart notes can help a balance grow faster than the same money held outside super. Past performance is not a guide to future returns — keep any figures illustrative, never predictive.

Example¶

Mia is in her twenties and her employer pays super into her fund each pay. She does not add anything extra to start with.

Each contribution is modest on its own. But her fund invests the balance, and the earnings are added back in. The following year, earnings are worked out on the larger balance — contributions plus last year's earnings. Repeat that over decades of work and the balance grows far beyond the total of the contributions alone. That is compounding doing the heavy lifting.

Later, Mia decides to add a small extra amount to her super regularly. Because those extra dollars also have years to compound, they lift her final balance by more than the extra amounts she put in.

These figures are illustrative only. Actual returns vary year to year and are never guaranteed.

Common misunderstandings¶

Thinking super only grows from contributions. The investment earnings on your balance are the other engine, and over time they can be very significant.
Assuming fees do not matter. For the same performance, higher fees generally leave you with less at retirement.
Believing small extra contributions are pointless. Over many years, compounding can turn small, regular extras into a meaningful amount.
Expecting a steady, guaranteed return. Returns go up and down; growth is not promised in any single year.

How this works in myaccountant¶

In the app — myaccountant records the super contributed on each pay and pays it across to employees' funds, so the amounts going in are tracked over time. Employees can see their super contribution history in the employee portal. myaccountant is not a super fund — it does not invest your money, set fees, or decide investment returns. Those sit with your chosen super fund.

Key points¶

Super grows from contributions paid in plus investment earnings on your balance.
Compounding means earning returns on your returns, which builds up over many years.
Time matters — the longer super is invested, the more compounding can do.
For the same performance, lower fees generally leave you with more at retirement.
Even small, regular extra contributions can add up over a working life.
Returns vary and are never guaranteed; treat any figures as illustrative only.

Learn next¶

General information only — not tax, super or financial advice.

Did this answer your question?