Zombie accounts: The $21 billion walking dead haunting Australians’ retirements

Australian Taxation Office data shows the average amount of lost super is around $41,000 - enough to make a meaningful difference to retirement outcomes.

Aware Super is urging Australians to hunt down their "zombie accounts" this Halloween season: super accounts that are technically alive, but not doing much for their owners.

Like zombies, these accounts often sit forgotten for years after a job change, house move or life event. They're still there, but disconnected from their owner and may be slowly eroding through duplicated fees or sitting idle with the ATO rather than working hard for retirement.

"Most people wouldn't ignore $41,000 if it was sitting in a savings account, but that's effectively what's happening with lost super.”

"These are the zombie accounts of the financial world. They're technically still alive, but they're not helping anyone and, in some cases, they're quietly draining retirement savings through duplicate fees and insurance premiums."

Rix explained that when a super fund loses contact with a member or an account becomes inactive for an extended period, it may be classified as lost super. In some circumstances, those funds can eventually be transferred to the ATO as unclaimed super, where they are held until they can be reunited with their owner.

ATO-held super is designed to keep lost or unclaimed money safe, but it may not be actively invested, meaning Australians could miss out on potential long-term growth that could help boost their retirement savings.

"When your super ends up with the ATO, it's safe, but it's not exactly pulling its weight," Rix said.

"Many people are surprised to discover they've got money sitting in a forgotten account. Reuniting that super with your active fund could be one of the easiest ways to boost your retirement savings and make sure your money is working as hard as you are."

"The good news is that finding and consolidating old accounts can take less than five minutes."

The five-minute "super exorcism"

Aware Super is encouraging Australians to perform a quick "super exorcism" by:

1. Logging into myGov
2. Opening ATO Online Services
3. Selecting Super
4. Checking for lost or ATO-held super
5. Consolidating any old accounts into their preferred fund

Australians can also contact Aware Super for help locating and consolidating eligible lost or ATO-held super into their Aware Super account.

Before combining super accounts, members should consider whether they have insurance attached to any account they plan to close, as any insurance in the old account will be cancelled when closed as part of consolidation.

"This could be the most rewarding five minutes you spend all year," Rix said. "Every dollar of super you reunite today is another dollar that can be invested for your future. Left untouched, lost super isn't just lost money, it's a lost opportunity."