Super a multi-billion battleground
Wayne Walker
Australian superannuation has become a multi-billion dollar battlefield in which choice of fund is playing a key role, according to actuarial and consulting firm Deloitte.
In an analysis released today, Deloitte partner Wayne Walker has disagreed with those who claim that choice of fund has been a non-event with respect to Australian superannuation, claiming that the company’s actuarial modelling suggests the opposite.
“Actual fund switches, reported at levels of 3 per cent to 5 per cent, involve billions of dollars each year,” he said.
Further, Walker claims that the 3 per cent to 5 per cent super switching represents only the tip of the iceberg, with many Australians exercising choice by remaining in their current fund when they change jobs — something that remains largely invisible.
He said the Deloitte analysis took just one component of ‘visible’ switching and calculated that if industry funds reduced switching from about 2.5 per cent to 1.25 per cent, then by 2021 industry funds would hold an extra 23 per cent or $2 billion of pre-retirement assets and an extra 48 per cent or $70 billion of post retirement assets.
The Deloitte analysis also looks at self-managed superannuation funds and suggests they will continue to grow and stand to become the largest sector in the superannuation industry.
AUTHOR
Mike Taylor
Recommended for you
Licensee Centrepoint Alliance has completed the acquisition of Brighter Super’s annual review service advice book, via Financial Advice Matters.
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
