What are Defined Benefit Super Funds? #superannuation

Added: 2026-05-22

[00:00:00]Good day everyone, Kevin the Koala here, and here's [music] the super fun type no one bangs on about. But it could seriously fatten your retirement wallet faster than a snag at a Bunnings barbecue.

[00:00:11]A defined benefit super fund doesn't ride the market roller coaster [music] like your mate who checks his balance every 5 minutes.

[00:00:18]Instead, your payout is calculated using a formula [music] based on your salary, years of service, and a benefit multiple. [music] These were big back in the day, especially in government and big corporates, but now they're about as rare as a quiet [music] tradie smoker.

[00:00:34]Most are closed to new members because they cost employers a fair whack to run.

[00:00:40]Here's why people [music] love them.

[00:00:42]Predictable retirement benefit, no nasty surprises.

[00:00:46]Not affected by market ups and downs.

[00:00:48][music] No stress when the news says markets tumble.

[00:00:52]Can be very generous if you stick [music] around long-term.

[00:00:55]Provides solid income security in retirement, [music] nice and steady like your uncle after two beers.

[00:01:02]But it's not all sunshine and surf.

[00:01:05]They are usually closed to new [music] members. Bit of a you had to be there situation.

[00:01:11]Less flexibility than regular super.

[00:01:14]Can be trickier to understand, [music] not exactly light bedtime reading.

[00:01:19]You're relying [music] on the employer or fund staying financially strong. No pressure, right?

[00:01:26]Let's break it down nice and simple.

[00:01:29]Final benefit [music] equals salary times years of service times benefit multiple.

[00:01:34]>> [music] >> Say someone earns $90,000, works 25 years, and has a 14% multiple.

[00:01:42]$90,000 [music] * 25 * 0.14 = $315,000. [music] That could come as a lump sum or be turned into a pension. [music] Not bad for just showing up to work and pretending to work on Fridays.

[00:01:59]If you're lucky enough to be in a defined benefit fund, you might be sitting on [music] a pretty juicy retirement setup. Save this post, have a squeeze at your fund, and make sure you know what you've got. Future you [music] will shout you a beer for it. And remember, this information is for educational purposes [music] only and does not constitute financial advice.

[00:02:19]You should seek professional advice from a licensed financial advisor before making any financial decisions. [music] Got it, champ?