Satisfaction with industry super continues to outshine retail funds

Peter Terlato 14 October 2016

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Industry super widens the contentment gap in 2015/16.

The proportion of industry super customers satisfied with the financial performance of their fund remains ahead of those with retail funds, corralling increased support in the six months to August.

New findings reported by Roy Morgan Research show satisfaction with financial performance among industry superannuation members (59.7%) scored higher than that of retail funds (57%) in the second half of 2015/16, resulting in a 2.7% gain in contentment and maintaining satisfaction superiority since 2002.

Comparatively, in the six months to August 2015, industry funds elevated their lead by only 0.7%.

The report reveals that movements in the Australian Securities Exchange (ASX) impact retail funds to a greater extent than industry funds. This is evidenced by the fact that the gap in satisfaction between the two fund types tightened considerably when the ASX registered a 48.3% jump in movements between 2012 and 2015.

In the last year the gap has widened again, coinciding with a 10% drop in ASX movements in 2015/16.

Despite the majority (60.8%) of super customers holding balances of less than $100,000, they only account for a small proportion (16.4%) of total dollars held.

Those with $700,000 or more in super represent just 2.8% of members but 17.6% of total balances.

Of these, industry funds lead with 83.3% satisfaction, compared to 80.5% for retail funds and 81.5% for self-managed super funds (SMSFs).

With an average balance of around $1.2 million and a proclivity for diversifying investments to spur capital growth, satisfaction among SMSFs is gaining momentum at the top end of the scale.

For super balances less than $5,000, retail funds (48%) are marginally more satisfactory than industry funds (47.5%), however, these funds comprise only a small proportion (0.2%) of total super contributions.

Research released last month revealed Australia's retirement savings pool would have been $105 billion better off if retail funds matched industry fund returns over the last two decades.

If you're looking to switch funds, consolidate your super, better manage your self-employed savings or take out income protection for your nest egg, it's best to compare options and make the right decision.

Picture: Shutterstock

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