Industry super funds more satisfying than retail

12 January 2018

Satisfaction with industry superannuation was higher than with retail funds over the last three months, according to Roy Morgan’s November Superannuation Satisfaction Report.

The report, which covered 30,000 super fund members per annum, found that satisfaction with industry funds was at 59.2 per cent, as compared to retail funds at 57.5 per cent.

This was the third month in a row that industry fund satisfaction had outperformed that of retail funds, after the opposite trend occurring for the seven months prior.

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Satisfaction with self-managed superannuation funds (SMSFs) was highest of all at 71.9 per cent, despite being down by 2.4 per cent over the last year.

In the six months to November 2017 SMSFs had the highest satisfaction for funds with balances of $700,000 and over at 83.0 per cent, while industry funds led satisfaction in the $100,000 - $699,999 bracket at 75.3 per cent.

Retail funds were the most satisfying only for members with balances under $5,000.

Satisfaction with superannuation funds’ financial performance in the six months to November 2017

Norman Morris, Roy Morgan industry communications director warned that super fund members should not be influenced by short term fluctuations in fund performance though, as superannuation is a long-term investment.

“This fact is highlighted in the research which shows that the fifteen largest funds measured for movements in satisfaction over the last year, nine showed an improvement and six showed a decline,” Morris said.

“We have seen over the years that these movements are often reversed, making the chasing of short term winners rather precarious.”

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Oh no not again! Those pesky industry super funds doing the retail funds again.

*Yawn* Come on Hedware, you can do better than that. They're not paying you for low effort trash comments like this!

Hi Matt - so easy - no effort needed - wonder what the retail funds stooge Dwyer will do about this win by the industry funds.

Comrade Hedware, how's your socialist corrupt union backed agenda travelling these days? I see your comments less often thankfully, but within a second of reading your diatribe, I know it's you without looking at the name.

Must be lonely out there as a true believer, now that the 'Rivers of Gold' report is circulating in the public domain. I know for clients that I speak with, it certainly helps make their mind up, especially when over 90% of them aren't even members of a union nowadays...

Hi there Comrade Joe,
You keep overlooking the 50% of directors on industry funds who are employer representatives (and doing a very good job obviously). Bit of an inconvenient truth about industry funds not being run solely by those unionists.

Here's an idea - maybe those poorly performing retail funds should get some of those unionists and socialists on board as directors to improve the performance of retail funds and to give their clients some satisfaction.

Independent financial advisors know it is good to have industry funds around - adds competition to the marketplace - adds benchmarks for funds to hit and exceed - adds to the reputation of independent financial advisors by having true marketplaces for funds. How very capitalist of me.

But you want to take out competition for the super dollar by taking out the stronger performing industry funds. You and your monopolist brethren want to keep the rivers of gold fees flowing from the punters into your pockets. How very socialist of you.

Competition is fine by me, and healthy as you indicate. It is the BS and largely unsubstantiated reports on 'returns', false advertising, agenda of destroying the FP profession, openly falsified slander against us at all levels of media and in parliament via their lefty stooges for their own benefit, that pits me against these unionists. Oh, and the fact they're terrible for anyone including members to deal with, let alone trust money to.

But, have to hand it to you, great idea, comrade Hedware. By unionists and socialists on board as directors of other funds, they can sway (ie. bully) the remaining board members to hide fees, use indiscriminate and irregular valuation methods on in house assets, rewrite terminology to opaque language like 'Other' or 'Alternate' when describing allocations and in general obfuscate enough that no one can really tell where all those millions are let alone how they're performing, then post any porky pies about returns they like! That would finally make it a level playing field -oh, and I see your true brilliance, with the same stroke, ASIC also will turn its biased one eye off them! Clearly you are an utter, utter Einstein. (For that last word, this publication is far too polite to allow me to post my original quote from Rik of the Young Ones, but you get the drift I am sure).

Considering how much industry funds waste on prime time advertising and sponsorships, this is actually a pretty bad result. Perhaps it would be in their members best interests to stop the excessive spending and return the profit to their members, in line with their promise.

Maybe but think of all those fat fees going into the pockets of those retail funds advisors. Despite being paid high salaries, they still don't beat the market. Perhaps it would be in their members' best interests to stop the excessive remuneration and return the profit to their members, in line with their promises. I mean the promises that the retail funds advertise all the time.
The retail funds advertise as much as the industry funds, they take more fees than overseas counterparts, and their performance doesn't match what they are paying themselves. They make it so easy for the industry funds to outperform them.

A 5 line comment, well done Hedware! That must be worth, what, at least $0.25? Good to see those industry fund member fees being put to good use! Online Industry Fund Shill must be a dream job.

You are living in the past, and also generalise way too much, one member with a industry fund cant be compared with an advised client with a wholesale offering offering total cash flow planning and optimisation for example. I also note the industry funds have low score with those under $5000 balances, which makes up 80% of thier actual accounts. No wonder with the outrageous admin and trustee fees they charge.

I like competition for clients' funds. I like how index funds and ETFs are undercutting fat fees. I like how industry funds are making the retails funds sweat. I like companies that make profits over the long term. I like independent professional financial advisers. I like corrupt financial planners being convicted. I like Royal Commissions into the nefarious deeds of our banks, insurance companies, and financial advisors. I like the ease of stirring up diatribes that attempt to support the unsupportable.

Hedware, mate, with posts like this it's like you're not even trying to not look like an Industry Fund shill. Tone it down a bit. Make it seem less obvious. You keep going this way and everyone will continue to not take you seriously

Hi Matt. Thanks for the advice. Got no stake in any industry fund. Want to see the retail funds perform better at a lower cost and offer better value for money. Most active funds not doing as well as the Australian Index funds (but acknowledge the market is concentrated and distorted in Australia). Want industry funds to crack the cosy and lazy old boys club called retail funds and to stir their shrills (which is so easy).

industry super funds are usually filled with low balance members in there 20's that simply don't care. So it's only natural they are happy. It's a bit like asking the citizens of North Korea if they are happy. You don't know what you're missing out on. It's not until you get into your 40's and realize they lost the cheques that you move.. .... to a proper fund. These industry super funds should also be banned from outsourcing admin to poor European countries, like Latvia etc.

Thank you Yogi for your support and agreeing that low balance members need to be in low fees super funds. That means industry funds of course.

Let me know how you are going in stopping self-managed fund trustees from outsourcing administration to themselves.

Good point, and great to see you acknowledge and that we both agree on the poor administration systems of industry super funds and that industry super funds have serious deficiencies, both in administration, performance and costs. All the best. I've got to go as I'm off to "fax" a form to an industry super fund based in Latvia... but I'll have to google fax first.

Me: I'm looking for a job.
Boss: What experience do you have?
Me: I've been top washing machine salesman last 3 years in a row. Earned bonuses of $150k last year.
Boss: Why do you want to leave you job and work as a financial adviser?
Me: I've heard there is a lot of passive income to make in financial planning and really I think I can make a lot more than the $200k I earned selling washing machines last year.
Boss: That's great how do you plan to do that?
Me: I'm very persuasive and don't have a problem doing what's needed to maximise revenue for your company.
Boss: Obviously you need to act in your clients best interest whilst exceeding your revenue targets (don't get caught or I'll sack you as soon as they find out). I think it's a good idea to place you with a few guys who made conference last year during probation to see if you are a good fit for our business (ie. learn how to extort your clients without them finding out and to twist the facts to ensure there is enough doubt if your advice does come into question).
Me: (He's going to show me how not to get caught). Seems like a great idea.

Have a think about it. Why are the educational standards designed to be so onerous? Why have they introduced LIF? The corruption is so inbuilt into the industry they are getting a big broom and sweeping out the white shoe brigade. Some good advisers will be cleaned out with them but hey that's life. 90% of the comments on here are the white shoe brigade hanging on to the gravy train. I jump on here once every 6 months because I have better things to do but it is the same old crims on here trying to dispute facts. Just embarrassing. Go back to selling washing machines.

I am sure there are some unethical financial advisers still in the profession just like there are some unethical lawyers, accountants, dentists, surgeons, politicians and doctors etc. However, in your comment you are trying to suggest that all financial advisers are unethical and that is just not true.

Of more importance is the education concerns regarding the directors of Industry Super Funds. Do you know what education requirements you have to have to be a director on the board of an Industry Super Fund??? I can answer that for you, none!!

It is unfortunate that financial planning has become the target in an ideological war being waged by socialists like yourself. You guys are not interested in the truth. You are motivated by resentment and malevolence and believe gaining control over Australia's superannuation savings will deliver you maximum economic power from which you can impose your tyrannical beliefs onto everyone.

The financial advice profession has, and is still, going through significant change. It is a very challenging business now, and I am sure thousands will be forced out of the profession due to the education changes. From my perspective, I think it is necessary to restore credibility to the profession through increased education requirements. However, it is obvious from your comment that malevolent socialist like you are aiming for the total destruction of the profession. You lot need to get your own ethical problems in order before you criticize others.

I used to be a financial planner back in the pre-FSR days. It was far worse than it is now, and boy did I work with some sharks. But looking at this, clearly things are much better. The comment from Some Balance Please in response to White Shoe Brigade above (love your pseudonyms, gents!) is simply wonderful and reminds me of a conversation I had with a friend recently:

Friend: Industry super fund directors have no qualifications.

Me: Their returns are better than retail funds, their fees are lower, they pay their directors and management less and they don't stuff around with related party payments in a huge way like bank conglomerates do. So aren't they doing something right?

Friend: But they have no qualifications!!!

Me: Oh good point! What rotters!

Please then goes on to win the argument with the tactical genius move of calling Brigade a socialist (and a "malevolent" one, at that). Well, I'm convinced! I'm going to a financial planner right now and giving them all my money. I don't care what overpriced, underperforming, rent-extracting products they throw at me.

and half the board directors have to be representatives of employers and they are at the senior executive levels of companies with staff in the industry super fund. This fact is overlooked or ignored by the rabid critics of anything not retail funds. I include the puppet Dwyer here - she never gives the truth about industry super fund boards.

As employer representatives are on industry super boards, then they act as a board and follow the requirements of boards. It is not as if the employee directors have the only say. My guess is that the critics have never been board directors and so are ignorant of the operations of commercial and not-for-profit boards and duties of their board directors.

You make a valid point Hedware, but if we acknowledge the statutory fact that unions can't lawfully dominate the boards of industry funds by law because of the legal requirement of counter-balancing legitimate boards with employer representatives, then we can't call them union-dominated anymore!

I hope I'll still get to scream "socialist" at you hysterically from time to time, though!

I made a truthful comment but obviously I have touched a nerve because it appears that I have hit a wasp’s nest with a cricket bat. It is true that there are no education requirements for Industry Super Fund Directors. It is also true that unionists are socialists. Or are you ashamed of your ideological beliefs???? Oh, I forgot, you people don't like telling the truth or talking about reality because you want to hide your true agenda. I am quite happy to stand behind my beliefs. I am not ashamed to say that I believe that the best outcome for society is to allow individuals the freedom to make their own choices. People do not need power hungry high-minded socialists using legislative or other force to make them do what you want. The socialist experiment was already run in the 20th century with murderous results (the Soviet Union, Maoist China, Pol Pot Cambodia etc). Industry Super Funds are one sector in the superannuation industry. You are definitely not the best solution for everyone. In fact, Industry Super Funds present significant issues given that you will not let independent directors on your boards. In addition, you do not let third party research analysts into your fund to perform qualitative analysis. My question is why? What are you hiding?

Top post Some Balance! Thank you for saying what most of us are thinking and articulating it so well. Have a great day!

Davey, you 'used to be a financial planner' says it all really. In other words, you weren't successful and couldn't make it, so now feel as if you have aright to be critical. Well good on you bud, everyone has a right to an opinion, no matter how incorrect or absurd it is, clearly. If your tone suggests that the ISA are more ethical and 'correct' than planners or retail funds then you need to be far more critical in your analysis, than your superficial (and mistaken) reasons 'their returns are better, fees lower etc'. Two sayings for you, there are none so blind as those who refuse to see, and a little bit of knowledge doesn't make someone an expert, just dangerous.

Dear Annoying, Your first sentence makes a presumption 'he couldn't make it' based on no proof whatsoever and that carelessness just means your following sentences cannot be relied upon to have any basis in fact or substance. Moreover I cannot read where he said the ISA advisors were more ethical. Again, this makes your comments unreliable and without grounds. Based your own words in your last sentence then you qualify on both counts. Well done as you got that correct.

"Davey", eh? Did you dig up my mother to have a chat with her or something, Anodyne? She's the only person who ever called me that.

I must admit, I noted separately from Hedware (your handles are simply superb, gents. Or ladies - I shouldn't be presumptive, should I?) that I can think of about a dozen reasons why I might have left the industry. The average person should find this easy to do as well. Even you, Anodyne, should be able to come up with a couple more reasons with a bit of thought.

However, you went straight for one in particular. Any particular reason? If I were to put this another way, is the reason that you're still a financial planner because you aren't successful?

You're absolutely right, everyone has a right to an opinion and I truthfully have to bow to your ISA fixation, because anything else would be unreasonable censorship, wouldn't it?

Davey, Davey, Davey - deep sigh, just like I am sure your good ol' mum used to as well, probably with that sad little shake of her head when she had to yet again slow things down and make it simple enough for you to understand - and I will use small words as well; my assumption (damn, too big, sorry let's say 'guess') that you weren't successful is quite logical, as the vast majority of those who can't make it any profession ultimately are forced out either by employers sick of their excuses, or by financial issues if trying to be in business; secondly, the fact that you took my comment to heart suggests I hit a nerve or perhaps a chip, which generally indicates there is some truth to the 'guess'; thirdly, and this perhaps is the most compelling, anyone who takes offense at just a suggestion to look more analytically at an investment or super than the prima facie (damn, did it again, um let's say simple or face value) PR rubbish that the self serving organisation puts out, with little 'independent' verification or transparency, clearly isn't much chop as a planner and shouldn't really last long anyway.

(Cue the clown, Hedware....?)

And on cue here come the clowns! :) Well done hedpiece, true to form always good for a laugh at how predictable and absurd your comments are.

And on presumptions and substance, we're yet to read a single 'comment' from you criticising any aspect of ISA funds, so hence the normal presumption has to be you're just one of their crony voice pieces spreading their particular brand of, er, fertiliser, hence no one except perhaps your other pseudonyms takes you seriously on here.

You must be really jealous of us successful, educated planners to say such things, but hey we have thick skins, your comments don't mean anything really. ps no one actually wears white shoes anymore, they went out with safari suits, when was the last time you saw a planner... 1970?

Nailed it White Shoe

I met an employee representative of a major Industry super fund about 4/5 years ago. I asked what there selection process was for determination of fund managers. I foolishly thought it would be a bunch of pimply faced Uni Grads and an investment officer and committee. In short, he said myself and couple of the other directors ultimately decide, we are that committee. This was an individual who was the Union rep for 20 years and a salt of the earth guy based in manufacturing. He waffled on for about 15 minutes about long lunches and basically nothing more than the company that wines and dines them the most gets the job. Industry super funds are not perfect and those that passionately support them in this forum, I would say are deeply conflicted in some manner. I use them where necessary but they are not the solution for all. On that note off to chase up a death benefit from an industry super fund for someone who died 12 months ago and the fund is still processing the paperwork.

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