POWERED BY MOMENTUM MEDIA
Super fee disclosure needs improvement
Although almost three quarters of Australians know their superannuation balance, half are not aware of the fees they pay, according to a new report from the Financial Services Council and ING Direct.
‘Superannuation - Australia's view 2013' found that although 72 per cent of Australians are aware of how much they have saved in superannuation for retirement, 52 per cent do not know the cost of fees charged.
FSC chief executive John Brogden said that Stronger Super reforms had begun to move the system towards greater transparency. However, fee disclosure and insurance (43 per cent of people did not know they had life insurance through super) were areas that needed improvement.
While most Australians (74 per cent) have default superannuation accounts and 64 per cent of respondents said they were unlikely to change funds, Brogden said the introduction of league tables and improvements to rollover processes could provide the impetus for members to switch.
"I think choice of fund will be used in the manner that it was always expected to be used," he said.
"When it's easy to move — number one — and there's more information and competition around fees," he added.
Currently most members (73 per cent) were aware of different fund options but few members actively discussed them: 66 per cent of respondents said engagement with their fund was limited to checking their bi-annual statements and many said they only "glance at their statement", according to the report.
Worryingly, under two-thirds of respondents believed they would have adequate super to fund their retirement, which led 40 per cent to make voluntary contributions if they could afford it and 55 per cent to invest outside of super in cash, shares or property.
Increasing the Super Guarantee to 12 per cent received widespread support (83 per cent) according to the survey, while 89 per cent knew that the purpose of superannuation was to save for retirement.
AUTHOR
Staff Writer
Money Management staff writers are writers who contribute to the website from time to time. If you would like to discuss the content contained within this article please contact us.
Recommended for you
In its pre-election policy document, the FSC highlighted 15 priority reforms, with superannuation featuring prominently, urging both major parties to avoid changing super taxes without a comprehensive tax review.
The Grattan Institute has labelled the Australian super system as “too complicated” and has proposed a three-pronged reform strategy to simplify superannuation in retirement.
Super funds delivered a strong 2024 result, with the median growth fund returning 11.4 per cent, driven by strong international sharemarket performance, new data has shown.
Australian Ethical has seen FUM growth of 27 per cent in the financial year to date.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
32.68 3 y p.a(%)
2
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.72 3 y p.a(%)
3
Spire Oaktree Opportunities XI First Close USD
31.36 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
29.60 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
27.64 3 y p.a(%)
