A new calculator launched by Industry Super Australia (ISA) shows that a person who joined the average industry fund a decade ago would have been nearly $20,000 better off than those who joined the average retail fund.
The calculator, which was developed by SuperRatings and commissioned by ISA as part of its new advertising campaign, shows the current balance of someone who had joined an industry super fund 10 years ago would have been $156,022 compared to a balance of $138,456 of a retail super fund member.
The modelling also found that for every $1 in fees charged during that time, the average industry fund delivered over $8.50 in earnings, compared to $3.20 from the retail fund.
ISA deemed the calculator (www.superrater.com.au) the most “comprehensive comparison to date of balanced options that shows the value offered by Industry SuperFunds compared to the retail super fund sector”.
Unlike the previous model – which compared industry super funds with retail funds on the difference fees and commissions could make to a member’s retirement income – the new model looks at the impact that long-term investment returns could have on a member’s account, as well as fees.
However, its disclaimer states the past performance was not a reliable indicator of future performance.
“Ten-year average difference in net benefit shown takes into account historical earnings and fees – excluding contribution, entry, exit and additional advisor fees – of the main balanced options of 16 Industry SuperFunds and all retail funds tracked by SuperRatings,” the disclaimer reads.
“Outcomes will vary between individual funds. Consider a fund’s product disclosure statement and your objectives, financial situation and needs, which are not accounted for in this information before making an investment decision.”
ISA deputy chief executive Robbie Campo said the calculator showed that the industry super fund sector provided substantially better value to members on average than the retail super fund sector.
“Over the last decade, strong performance coupled with low fees has meant that the average Industry SuperFund member would have been better off than the average retail super fund member,” Campo said.
