The chief executive of ING, Paul Bedbrook, has launched an attack on the advertising campaign funded by industry superannuation funds claiming that “those who put financial advisers down do a disservice to the industry and the investing public”.
Bedbrook told an Association of Superannuation Funds of Australia luncheon in Sydney that the financial planning industry had come a long way and that “compliance is now king”.
He pointed to the negativity of the anti-value of advice advertising in the context of millions of Australians relying on compulsory superannuation contributions finding they face a retirement savings gap in the order of $100,000 to $150,000.
“Against this backdrop I put it to you that the provision of appropriate advice on investment strategies and insurance cover within super funds has never been more important,” Bedbrook said.
He said the Government had shifted responsibility for retirement income adequacy to individuals and that it was in these circumstances that ongoing quality financial advice needed to be a key consideration.
“Needless to say I disagree with bunging it all into an accumulation fund such as an industry fund which proudly says in its advertisements that ‘we pay no commissions and you should not seek financial advice’,” Bedbrook said.
“My point is not that they bag us, my point is that they say commissions and fees to advisers are a waste of time,” he said.
“Well, if you sit with them (industry funds) you may be okay, but the average account holder in those funds cannot afford to simply set and forget.”
Bedbrook acknowledged it could be argued the cost of advice was sometimes greater than the benefit, but he believed the real value in consulting a financial planner lay in their ability to carefully assess clients’ full financial circumstances and needs and devise a plan to meet their overall financial goals.
He said he believed there was also a role for advice in the super choice space where 80 per cent of superannuation fund members had opted for default funds.
