Put simply, a super fund is a trust that invests funds for its members. Being a trust, the management of the super fund is the responsibility of the trustees of the fund. These responsibilities are split into two different jobs.

The first is the administration of the fund. This includes ensuring contributions, income, expenses and payouts are dealt with properly. An administration fee is charged to the members for this service by the trustees of super funds, except for SMSFs.

The second is managing the investments of the super fund. The costs of the investing function can include direct costs of buying and selling investments, such as brokerage and bank charges, and fees charged by fund managers investing the money.

From July 1 there will be the following six types of super funds: retirement savings accounts, My Super, industry funds, commercial funds, small APRA funds and self managed super funds.

Retirement savings accounts are effectively superannuation bank accounts. In this super fund the administration and investing are bundled together. As they earn a very low interest rate, compared to the long-term earnings rates of other super funds, not many people have them.

My Super accounts will be offered by both industry and commercial super funds. They will be very cheap from an administration point of view but won't have many investing options.

As far as a vehicle goes they are like deciding to use public transport rather than owning your own car.

Industry superannuation funds have seen the greatest development and improvement over recent years. Like imported cars made in Asia, they started out being very cheap when it came to administration costs, but their levels of service and options for members were limited.

Just like many Asian car manufacturers that have improved their vehicles over time, many industry funds have improved their service levels and now offer a wide choice of options while still maintaining low administration costs.

Commercial super funds are similar to high-priced imported cars. They are often a lot more expensive when starting out because of advisers' commissions and higher administration fees. These higher fees can be offset by having more choices when it comes to investing.

Self managed super funds are the four-wheel-drive vehicle of the superannuation industry. They offer almost unlimited options, the flexibility to go to where you want when it comes to investing, and they'll get you where you want to go when it comes to accumulating superannuation and drawing a pension in retirement.

Due to their many options, and because they really are a specialist vehicle, they require more professional help to drive and maintain. They suit members with large super balances who want to have greater control of their financial and superannuation destiny.

As the members of an SMSF are also the trustees of the fund, they are responsible for the administration and investing duties of the fund. SMSF trustees have the choice of doing virtually everything themselves, to keep costs down, or using administration services and accountants to help with these duties.

Small APRA funds are similar to an SMSF except the trustee role is handled by a professional trustee company, which can make them very expensive.

In the final analysis, choosing a superannuation fund is very much a personal decision. If you have large amounts in superannuation it makes sense to get professional advice to ensure the super fund you pick suits your circumstances.