Retirement
Super fund fees finally drop
Gross superannuation fees have fallen for the first time in six years, meaning super fund members are now paying 1.1 per cent fees on average, down from the 1.2 per cent they were paying in 2018.
Super fund fees finally drop
Gross superannuation fees have fallen for the first time in six years, meaning super fund members are now paying 1.1 per cent fees on average, down from the 1.2 per cent they were paying in 2018.
The 2019 Rainmaker Information super fund fee study has analysed the fees charged by more than 500 superannuation funds and 50 self-managed super fund administrators in its new report.
According to the financial services information provider, super funds are capitalising on their growth in assets under management, achieving greater economies of scale and reducing costs for their members.
Head of superannuation research at Rainmaker Information Jason Ross said “super fund fees are approaching an average of 1 per cent”.
He commented that the reductions show an industry shifting towards a greater commitment to improving super for the members.
Despite the recent drop, he did flag that “Australia’s 13.5 million super fund members still pay $2,400 on average each year in fees, the equivalent of the average household energy bill”.
Rainmaker found that of the 1.1 per cent portion of their super fund that members are paying in fees, 0.7 per cent is paid for investment fees and 0.4 per cent is for administration and product related fees, on average.
It also noted different fees were prevalent dependent on the super product type with which an individual was aligned:
- Workplace funds - used by employers - charge an average 1.24 per cent.
- Personal funds - that members can join as individuals - charge an average 1.49 per cent.
- Retirement funds - for members who have retired - charge an average 1.33 per cent.
- Small self-managed super funds charge an average 0.80 per cent.
According to Rainmaker, the fall in gross fees was primarily a result of retail funds lowering their fees as a competitive reaction to members moving across to lower priced not-for-profit (NFP) funds.
It said that while the average retail MySuper product charged 0.24 per cent more than NFP products in 2015, the gap has now narrowed to just 0.04 per cent.
From Mr Ross’ perspective, “after 10 years of the regulators failing to make considerable impacts on the super landscape, last year’s Productivity Commission and royal commission have already started to prove their effectiveness”.
RELATED ARTICLES
About the author
About the author
Superannuation
Australia's super performance test transforms investing: What's the next move?
APRA’s latest performance test has done more than name and shame lagging super options; it has rewired investment strategy, compressed fees and accelerated consolidation across the $3Read more
Superannuation
Australia's super test dilemma reform could boost long-term gains while keeping accountability sharp
APRA’s latest performance test results have reignited a structural debate: can Australia hold funds to account while still backing the nation’s long-horizon investment needs? With the government ...Read more
Superannuation
Super funds rethink strategy as APRA's performance test hits a fork in the road
The latest performance test results have reignited debate over Australia’s superannuation benchmarking regime and prompted a formal government review. Behind the headlines, boards are quietly rewiring ...Read more
Superannuation
Aware Super enhances digital tools for financial advisers, boosting efficiency and client engagement
Aware Super has unveiled a suite of new digital features designed to streamline the workflow for financial advisers and their clients. This significant upgrade includes direct data feeds to Xplan and ...Read more
Superannuation
Super funds flip the script as APRA's performance test sparks strategic overhaul
Australia’s performance test has lifted the floor on retirement outcomes—and divided the industry in the process. After early shockwaves, failure rates have fallen and fees have trended down, but ...Read more
Superannuation
Rewiring Australia’s super performance test: from compliance brake to capital engine
Can an accountability tool double as a nation-building lever? Canberra’s review of the superannuation performance test aims to preserve member protection while freeing funds to back long-dated assets ...Read more
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
Superannuation
Australia's super performance test transforms investing: What's the next move?
APRA’s latest performance test has done more than name and shame lagging super options; it has rewired investment strategy, compressed fees and accelerated consolidation across the $3Read more
Superannuation
Australia's super test dilemma reform could boost long-term gains while keeping accountability sharp
APRA’s latest performance test results have reignited a structural debate: can Australia hold funds to account while still backing the nation’s long-horizon investment needs? With the government ...Read more
Superannuation
Super funds rethink strategy as APRA's performance test hits a fork in the road
The latest performance test results have reignited debate over Australia’s superannuation benchmarking regime and prompted a formal government review. Behind the headlines, boards are quietly rewiring ...Read more
Superannuation
Aware Super enhances digital tools for financial advisers, boosting efficiency and client engagement
Aware Super has unveiled a suite of new digital features designed to streamline the workflow for financial advisers and their clients. This significant upgrade includes direct data feeds to Xplan and ...Read more
Superannuation
Super funds flip the script as APRA's performance test sparks strategic overhaul
Australia’s performance test has lifted the floor on retirement outcomes—and divided the industry in the process. After early shockwaves, failure rates have fallen and fees have trended down, but ...Read more
Superannuation
Rewiring Australia’s super performance test: from compliance brake to capital engine
Can an accountability tool double as a nation-building lever? Canberra’s review of the superannuation performance test aims to preserve member protection while freeing funds to back long-dated assets ...Read more
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
