Consumers care most about superannuation fees and performance
Meanwhile, technology was ranked as the least important factor when choosing a super fund.
Australian consumers have ranked fees and performance as the two most important factors when selecting a super fund, according to new data from a survey commissioned by Industry Super Australia. Of the 1,000 respondents, 74% said that fees were either extremely important or very important, 64% said the same about the fund's performance history and 60% said the same of investment flexibility.
On the other end of the scale, technology and ethical investment options were ranked last on the list. Only 35% and 34% of consumers ranked technology and ethical investment options (respectively) as very important.
Over the past year, we've seen an increase in new super funds that are heavily focused on technology, such as Spaceship and GROW Super, which are targeting millennial consumers. However, despite increased investment in technology to appeal to younger Australians, these rankings were the same across the generations. Millennials, gen X and baby boomers all ranked fees and performance as the top factors.
From tomorrow (30 September) there will be significant changes to the way super funds present their fees and charges, making it easier for consumers to understand them. The changes come after the Australian Securities and Investments Commission (ASIC) conducted a report into the industry that revealed that many super funds were under-reporting their fees and charges or presenting them in a way that was difficult to understand.
Industry Super Australia's public affairs director Matt Linden said that it is important they put regulations in place to ensure that consumers understand the fees and charges, however, the new changes could prove problematic.
"Unfortunately, with fee disclosure, there is no simple and transparent way of comparing fees on various products across the entire system. As the financial watchdog, ASIC needs to get these fee disclosure rules right for all Australians," said Linden.