Three giants of the superannuation industry have combined in a bid to tackle the ongoing issue of financial illiteracy after conducting research that found almost 60 per cent of respondents felt their knowledge of super was less than adequate.
The research, which also revealed 63 per cent of those surveyed believed financial planners provided advice that is in their self-interest, was conducted by industry fund heavyweights Retail Employees Superannuation Trust (REST), Superannuation Trust of Australia and Sunsuper in October.
The three funds, which commissioned independent research firm Roberts Research to survey 400 individuals on their understanding of super, also found that 76 per cent of people had not reviewed the performance of their fund over the past year and only 30 per cent either agreed or strongly agreed they would be comfortable in making decisions in a ‘choice’ environment.
With one out of four super fund members invested with these funds, the trio have joined forces to kick-off an education campaign aimed at increasing the financial literacy of their combined 2.5 million members.
The initiative, Education Key, will consist of a range of communication and education materials to cater to different learning styles and life stages. The initiative spans a number of mediums and include print, web, call centre and within the workplace.
Over the next year, the program plans to run over 500 seminars, conduct more than 10,000 workplace visits, respond to over 800,000 member enquiries and 130,000 employer enquiries via the funds’ call centres, and expects over 700,000 visits to the funds’ websites.
According to REST chief executive Neil Cochrane, the initiative will harness the existing member education activities of the three funds and will pool resources across the funds to build a sustainable, cost effective model.
“We have come together to leverage the advancements of all three funds in developing effective forms of communication with members,” Cochrane said.
“Our all-profits-to-members approach underlines a genuine focus on member education — we want to do more for members, and to ensure we are at the cutting edge in terms of global best practice in member communication,” he said.
Financial services education provider Communi(k) has been charged with assisting in the development and coordination the program.
The foundation of the model will be intensive market research to better understand what types of educational approaches will prove most effective in engaging members.
“Our initial research reinforces widespread industry concern over the ability of Australians to make informed choices, and highlights the need for an education program that takes the next step – not only in raising engagement levels but also transferring engagement into informed decision-making by members,” Cochrane said.
Preliminary research has found many Australians do not feel comfortable making even basic decisions about their superannuation investment.
“Education Key is not about producing more collateral material which we know a large proportion of members don’t read,” Cochrane said.
“Given almost one in every ten dollars earned is invested in super, clearly there is a need to try a different approach,” he said.
“By joining forces, we have achieved a cost-effective model which can lead the way in education research and development, while still delivering independent information.”
