Retail superannuation fund balances of $250,000 or more will be under threat from both industry and self-managed super funds (SMSFs) in terms of satisfaction, according to Roy Morgan Research.
The research house found that retail funds of over $250,000 had a 69 per cent customer satisfaction rating compared to industry funds at 78.7 per cent and SMSFs at 76.1 per cent.
Roy Morgan industry communications director, Norman Morris, said the group needed to be closely monitored because they held over half of all super funds but only accounted for 15.7 per cent of members.
“Of particular significance is the fact that satisfaction among industry fund customers has remained ahead of retail-fund customers for many years, and also poses a real threat in the higher balance segments,” Morris said.
“It is important to note that both groups face potential losses to self-managed funds from their higher value customers if satisfaction levels decline.”
The research found satisfaction with SMSFs in the $700,000 and over group was at 83.4 per cent for industry funds, 81.5 per cent for SMSFs, and 80.5 per cent for retail funds.
“With intense competition between retail super funds and industry funds, it is important to understand what fund customers think regarding the financial performance of the two groups [industry and retail funds],” Morris said.
“It should ultimately be the customers who decide where their funds are best directed but there may be difficulties for many understanding or accessing performance tables, and advisers may also influence a less-than-optimum choice.”
However, for those holding less than $5,000 in super, retail funds had a marginally higher satisfaction than industry funds at 48 per cent and 47.5 per cent respectively but this segment only accounted for 0.2 per cent of super funds.
Overall, industry fund satisfaction for the six months to August was at 59.7 per cent, and 57 per cent for retail funds.
