POWERED BY MOMENTUM MEDIA
Super members up to $230,000 worse off from underperforming super
Industry Super Australia has called on the Senate to agree to amendments in the Your Future, Your Super bill to prevent workers being trapped in underperforming products.
It wants workers to only be stapled to those funds which have passed a performance test as up to 2.6 million workers were invested in funds that could fail a performance test, it said.
Remaining stapled to an underperforming fund for their lifetime could cost up to $230,000 in lost savings.
It also said $500 billion would be ‘shielded’ from performance tests as they sat in the for-profit fund-dominated ‘Choice’ sector which had been found to be ‘littered with high-fee charging duds’ but was excluded from the YFYS performance tests.
ISA urged the Government to pursue amendments in:
- Expanding performance tests to all fees and products;
- Mandating members can only be stapled to super funds that pass the performance test; and
- Ensuring best financial interests duties also applies to the up to $10 billion a year profit creamed off the top of members’ savings.
Bernie Dean, ISA chief executive, said: “Senators know full well that most people don’t spend a lot of time thinking about super and deserve to be protected from ending up chained to a dud fund.
“The Senate can boost members savings and stop them ending up with too many super accounts by simply mandating workers can only be stapled to the best-performing funds.”
AUTHOR
Laura Dew
Laura Dew is editor at Super Review. Prior to joining SR, she spent five years working at Investment Week in the UK covering asset and wealth management.
Recommended for you
A member body representing some prominent wealth managers is concerned super funds’ dominance is sidelining small companies in capital markets.
Earlier this month, several Australian superannuation funds fell victim to credential stuffing attacks, which saw a small number of members lose more than $500,000.
Small- to medium-sized funds have become collateral damage in an "imperfect" model for super industry levies, a financial institution has said.
Big business has joined the chorus of opposition against the proposed Division 296 tax.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
90.28 3 y p.a(%)
2
GAM LSA Private Shares AU I
37.08 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.44 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.12 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
28.28 3 y p.a(%)
