27th Jul 2018
Super funds are ‘exploiting’ members: ASIC chairman
Author: Janelle Ward
Super funds are ‘exploiting’ members: ASIC chairman

Superannuation funds are exploiting members and have forgotten that they are built on other people’s money, according to Australian Securities and Investments Commission (ASIC) chairman James Shipton.

Meanwhile, ASIC is under pressure to make super costs more transparent after a review found disclosure fees were too difficult for the average consumer to understand.

Speaking at the Financial Services Council (FSC) annual summit in Melbourne on Thursday, Mr Shipton warned that the $2.6 trillion industry had a “trust deficit”. He said that issue would be magnified when the banking royal commission resumed on 6 August and focussed on superannuation.

“To be blunt, there has been too much focus in many parts of the superannuation sector on exploiting opportunities to make money from Australians instead of focussing on the responsibilities that come from being the custodians of other people’s money,” he said.

“This must change.”

He said some of the blame for super funds “exploiting” members was due to public apathy when dealing with the sector.

The ASIC chairman was also critical of the delayed reporting of breaches by financial services companies to the regulator, with four years being the average time between a company identifying a breach and ASIC being notified.

He said that there had been a 30 per cent increase in breach reporting by financial services groups in the past year, stressing that there was an urgent need for investment in systems, procedures and policies that more quickly identified problems.

“This is behaviour that leads to unacceptably poor member outcomes in super, and it must stop if Australians are to have real trust in the superannuation system,” Mr Shipton said.

Financial Services and Revenue Minister Kelly O’Dwyer said via a pre-recorded video that it was time to “draw a line in the sand”.

“Use it (the banking inquiry) to separate the behaviours which should not have occurred in the first place, and a new post-Commission era where trust is regained and maintained,” she said.

The Australian reported on Wednesday that ASIC was under pressure to make costs more transparent after a review found consumers were being “dudded” by poor disclosure of fees.

Matt Linden, public affairs director at Industry Super Australia (ISA), said the review showed “fee disclosure was far too complicated for experts, let alone for consumers.”

The review “finds fee disclosure in the superannuation and managed­investment scheme industry has been haphazard, opaque and open to gaming by funds managers looking to minimise their published fees,” The Australian reported.

It also said that Westpac’s wholly owned wealth arm, BT Financial, “had sent shudders through the sector after it outlined plans this week to introduce a new cut-price 0.15 per cent asset administration fee for customers invested through the BT Panorama Investments and BT Panorama Super platforms, along with a flat account fee of $540 a year.”

On an average account, the move represented a fee cut of 40 per cent.

Are you looking forward to the banking royal commission moving onto the superannuation industry? Are you apathetic when it comes to your super? Do you know what fees you are paying and how they compare to other funds?

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    COMMENTS

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    27th Jul 2018
    10:09am
    I would like to see both fees and investment return calculations made more transparent
    MICK
    27th Jul 2018
    10:24am
    I'd like to see the what the remuneration of executive staff is and I'd like a comparison between Industry and Retail Funds. That is something unlikely to happen because the current government is a protector of crooks in suits at the top end of town.
    If there is nothing to hide then WHY NOT?????
    jackie
    27th Jul 2018
    11:53am
    Superannuation is a business. All business is about making profits for itself. Superannuation funds should be run by the Government because it should be at its best interest to make sure all Australians will have enough money to keep themselves when they retire.
    Hasbeen
    27th Jul 2018
    12:36pm
    Mick do you really think the current government protects union bosses better than a Labor government
    Old Geezer
    27th Jul 2018
    1:16pm
    Mick your union bosses would never disclose their remuneration and kickbacks.

    Anyone receiving a pension from super especially industry funds is being short changed as they are not now getting the benefit of any franked credits on their investments. Those franked credits are being used to pay the tax of those in the accumulation phase resulting in a nice big bonus (kickback) for the union bosses running them.
    TREBOR
    27th Jul 2018
    1:17pm
    Originally I thought that was the idea, jackie - that people could save for retirement and thus the burden on pension funding would be less in the future... instead it's been hijacked as just another nice little earner for those 'on the inside'.

    It should always have been a government initiative - but not one controlled and accessible by politicians, who may, like everyone else, put to the Fund a business proposition to fund infrastructure etc, and repay at a specified rate of interest.... thus the assets/outgoing would be controlled - unlike the current wreckage of social security funding coming from 'consolidated revenue' (just another way of telling a lie) regardless of how much actually goes into that funding from contributors out here in Taxland.

    Like all the funding that goes into roads etc from petrol and rego etc - it all gets sidelined into pet projects and party ideological 'emergencies', so the contributor is always left out in the cold and is then subjected to 'private enterprise' reaping the lion's share of the cream off the top.... long before the contributor ever gets his/her hands on one cent.

    Trebor Scheme anyone?
    TREBOR
    27th Jul 2018
    1:18pm
    Nowhere 'especially from industry funds' OG - the proof is in the annual return to contributor.

    Get with the facts and people might begin to give your views some credibility instead of using them as a stand-up comedy routine.
    Old Geezer
    27th Jul 2018
    1:42pm
    Trebor explain to me then why someone getting a pension gets the same return of others in industry super funds no matter where their money is invested?
    KSS
    27th Jul 2018
    1:55pm
    Mick the executive remuneration is generally in the annual reports. Most people don't bother to read them.
    MICK
    27th Jul 2018
    2:37pm
    Nice to see the government has given you a shift again Hasbeen/OG.

    You of course do not want to compare the remuneration of CEOs from Industry Funds against Retail Funds because that likely would tell a complete story of the top end of town in the feeding trough. WHY do you think Retail Funds perform so poorly against Industry Funds. Can't have money going to those who contribute to the funds can we?

    You two have a track record of changing the subject to avoid confronting the truth but readers on this website have woken up to you. Wasting your time and the government may want to not employ you in future.
    TREBOR
    27th Jul 2018
    2:47pm
    An odd way -of putting your question, OG - but I'll try...

    Your basic contribution goes into the mega-super fund, and you are permitted to place extra in as super up to a specified limit. Whatever concessions are due to super contributions are still to be resolved rationally, but the outcome remains that those who are able to contibute more to their personal retirement fun - up to a specified limit - are NOT on the same wicket as those who are forced by whatever circumstances to get by in retirement on the basic Pension as derived from social security levies, the still persistent 7.5% of income tax, and the Future Fund as folded into the retirement scheme.

    NOBODY gets a free ride any more - but everyone can put away super to a limit and then invest elsewhere as they choose - but be faced with tax as required for a change.
    Old Geezer
    27th Jul 2018
    3:23pm
    Trebor a brick wall has more idea of what I am talking about than you. You really have no idea about super at all.
    Knows-a-lot
    27th Jul 2018
    5:12pm
    I see the LNP shills are out in force today.
    TREBOR
    27th Jul 2018
    6:00pm
    You don't have super, OG - you have no right to comment. You claim to be a SMFR who turns $400k into an $80k profit annually, travels first class, has everything under the sun, knows everything about investment and has connections with politicians... but you don;t even vote according to your story.

    The super system is broke - nobody says you can't have a SMF on the side - but you only get one bite at the cherry of any subsidies that come with super - since you will already, under the Trebor Scheme, be receiving a minimum etc as described.

    You may choose to opt out any time from the Trebor Scheme and go it alone - but you'll need to negotiate for any concessions in super, and will still be bound by the maximum contribution rules.... beyond which it is savings pure and simple and you are liable for tax on the earnings, same as assets that produce income and such ... your choice...

    The system for the majority needs to be fixed - nobody actually cares about your purported financial wisdom.
    Noodles
    28th Jul 2018
    10:15am
    Read the other day (ASIC I think it was) that 90% of self managed super funds fail.
    Old Geezer
    30th Jul 2018
    4:00pm
    Well Noodles if my SMSF is failing then I am loving it.
    jonboy
    27th Jul 2018
    10:18am
    Just like the banks Super Funds are only interested in how much THEY can charge and how much money THEY can make off the mug workers.
    MICK
    27th Jul 2018
    2:39pm
    Your comment refers to Retail Funds which bleed their members dry.
    The union representation on Industry Boards is why these funds are outperforming Retail Funds and that is why the current government has tried to remove union oversight....so that the top end of town can give themselves huge salaries.......money belonging to members.
    Ted
    27th Jul 2018
    11:14am
    We all need to complain loudly to the fund managers. I have been complaining to financial adviers about the fee system for years, got nowhere. After the first Royal Comission hearings I wrote to AMP direct about their fee structure. It has taken seven different people to handle the complaint and many phone calls but I am told I will be getting an answer next week. The more complaints the funds get the more likely they are to change the system.
    MICK
    27th Jul 2018
    2:39pm
    True.
    johnp
    27th Jul 2018
    11:28am
    Industry Super funds are apparently looking after their members- witness their suoerior performance
    MICK
    27th Jul 2018
    2:40pm
    They are. That's why the government tried to demonise union members on the Boards of Industry Funds and did everything it could to remove them.
    Noodles
    28th Jul 2018
    10:16am
    My fund is not the biggest earner but I am happy with the return.
    floss
    27th Jul 2018
    12:06pm
    Who was the clown that said WE DO NOT NEED A ROYAL COMMISSION perhaps they knew it would embarrass their mates and it certainly did.
    MICK
    27th Jul 2018
    2:41pm
    I think it was Malcolm Turnbull. Funny that. Hiding his mates????
    VeryCaringBigBear
    28th Jul 2018
    1:57pm
    All the Royal Commission will do is make more rules which will make it harder for people to get loans and other financial products. The increased costs will also give lower returns on investments. Sure a few who blame the banks for their own greed might get a bit back but that will be at the cost of the honest investor. Funny how things back fire so well on honest people who think they doing the bright thing.
    pedro the swift
    27th Jul 2018
    12:14pm
    So suddenly ASIC has woken from its slumber and making comments about how "bad" super funds have been treating their customers?
    As far as my suoer goes , yes I know what fees they charge as I get reports on that as I'm sure other funds send their customers, if they bother to read them.
    I see another witch hunt on super funds, mostly industry funds and the gov will try to find a way to "tap" into the all funds to see how much they can screw out of them.
    Took them long enough to set up this royal" commission into banks. How about a corruption commission into gov behaviour
    TREBOR
    27th Jul 2018
    1:22pm
    Just a few barks from the sleeping dog before he lapses into slumber again... once the next FedElect goes through, it will be All Quiet On The Investment Front again..... just the equivalent of a battalion a day going down the tubes... but TOI - they're only investors....

    ASIC kicked into life and a few desultory barks for political gain, then ordered to lie down again lest it upset the neighbourhood.

    Federal ICAC needed... NOW!
    Old Man
    27th Jul 2018
    12:37pm
    I agree it's time that the superannuation industry was looked at, nothing serious has been done since the Keating government made this legislation to help all Australians. From stories told on this site previously, there are many reasons to validate a complete overhaul of the system and maybe revamp the legislation. Surprisingly, I don't agree with MICK's continued promotion of industry funds as if they are squeaky clean. All funds may be, in some way, overcharging the members and there is no proof that any fund is exempt from sharp practices.
    HarrysOpinion
    27th Jul 2018
    12:41pm
    Ditto
    TREBOR
    27th Jul 2018
    1:24pm
    I'm pretty sure Mick doesn't say they're all squeaky clean and all the top performers - just that they make up the vast majority of the top performers...

    I personally have long directed my comments at the entire gamut of superannuation funds and the current social security and Futures Fund - all needing to be brought under one roof and out of the lying hands of politicians and their mates, including politicians past, who should just quietly fade away and suck deeply on their huge 'superannuation' and leave the rest of us alone.
    MICK
    27th Jul 2018
    2:43pm
    You wouldn't OM because you are in the LNP corner.
    The facts are clear. Industry Funds are slaughtering Retail Funds. Only the most blatant liars amongst the trolls would ever deny that. It is an irrefutable FACT!
    Old Man
    27th Jul 2018
    3:02pm
    Are you related to Old Geezer MICK? He is usually the one who generalises. Yes, some industry funds are achieving a higher rate than some retail funds but not all industry funds are better than all retail funds.

    But MICK, this article is not about returns, it is about the cost to clients of the fee structure and the lack of transparency in the superannuation industry as a whole. If there is nothing to hide then the Royal Commission will find nothing but I'll bet parts of my anatomy that all sections of the industry will need to change.
    TREBOR
    27th Jul 2018
    6:06pm
    **laugh** Mick related to OG....

    Yes - not all industry funds are at the top - just more than retail .....

    And yes the fee structure in any super fund is excessive and a money-making scheme - not a genuine for-the-contributor scheme at all.... unless you are covered under the Future Fund or State government super schemes or Big Boy super schemes for the bosses in industry - all of which are subsidised enormously.

    The government, on the other hand, failed to guarantee a certain level of return for all schemes - unlike its own highly favourable one.

    Too many different rules.... and clear distinctions between the 'lifters' and the 'leaners' - forgetting that the 'leaners' do all the hard work....
    LieDetector
    27th Jul 2018
    12:57pm
    When Financial Sevices & Revenue Minister Kelly O'Dwyer announced that she will legislate to have 3 or more "independent" members added to Super boards because unions are over represented and block access to money that retail funds and banks could employ more efficiently. O'Dwyer's fixation on this remains despite having her claim that retail funds outperform industry totally discredited. She persisted with this lie and her unstinting stand that the Royal Commission was a waste of money and nothing to see here. Given what has been exposed at the RC of banks and AMP fund management would make her want to drop it at speed. Now James Shipton from ASIC is getting in on the act and in his statement implies ALL sper funds have been exploiting members and not being transparent. Industry funds ARE transparent and their fees and charges are out there and reasonable. My super churned 4 times as the insurance companies were taken over or sold with the top end taking golden handshakes out of the super. I finally gave it the flick when the whole premium was swallowed up to pay for planners I had never met. What was there to 'plan ' when I can't access it for 35 years? All there was for them to do was getting the money to where it would return and show growth and accumulate. Mine went backward and releti es went ahead by factors. Trailer comissions and life insurance even after the rep died was still leaking to him. Now K. O'Dwyer has a boss, PM Trumble (trumpism) and the bods in the LibNats. Is she the dummy and PM the organ grinder? Why would ASIC blanket ALL super funds when Industry wipes the floor with retail, bak and insurances? Our only hope is to pre-empt O'Dwyer in the next general election and send the whole bunch off to collect their super and Parliamentary pensions and to the back bench in Opposition. To bookend this, the extra members to the board from bank and political backgrounds will want to be renumerated not at the peppercorn rates the current i dustry boards pay. We will be up for hundreds of thousands across the sector and by the time the battlers get to collect they will be hundreds of millions out of pocket especially after some of their influences crash out. Peter Costello wants to collapse ALL funds into one and use it to dole out subsistence pensions and end governments pension transfers. Alarmist? I wish.
    TREBOR
    27th Jul 2018
    1:27pm
    Just a blatant takeover of industry funds so the banks can get their hands on the money.

    The answer is no O'Dwyer... now go back to kindergarten - the public aren't that stupid.

    Are there to be three 'independent' people on all retail funds as well, including Union hacks and maybe a pensioner or two?

    I doubt it.... typical of the lying Liberals to imagine they have some divine right to dictate to everyone they want to - but not equally across the board.
    TREBOR
    27th Jul 2018
    1:30pm
    While the Trebor Scheme is similar to that of Don Pedro Castella (of El grande Republica da San Austrador, por favor) - by no means would pensions be 'subsistence' level - but would adequately reflect living costs and allow additional superannuation top-up to a specified limit and no more.

    All your savings and investments outside of that then become subject to taxation review and possible taxation - including the freebies your 'past' company gives you into the millions...

    That way everybody gets a basic and can save for extra within limits - but no more rorts to favour the fat cats... and that includes the Future Fund and all 'superannuation' derived from it....
    Old Geezer
    27th Jul 2018
    2:25pm
    I don't like your scheme at all Trebor as it lacks incentive to do better. It is just so limiting and would force people off shore into tax havens real fast.
    TREBOR
    27th Jul 2018
    2:42pm
    You can do better, OG - just not by taking unfair advantage of concessions and privileges involved in providing a universal retirement package...

    You are always welcome to put your investments elsewhere and pay your dues, while reserving a basic Pension + ceilinged super contribution as the base for your retirement.

    When you invest, it should be treated as a business ... not permitted all kinds of freebies and loop holes to pay no tax.
    MICK
    27th Jul 2018
    2:48pm
    Correct LieDetector. The more you look at it the more Turnbull and his cutthroat government are trying to take over Industry Funds like they have Retail Funds and turn them into the next big end of town cash cow. Members need to resist this.
    Use the ballot box. That what it was always intended for.

    You wouldn't like TREBOR's view OG. It is fair and sensible. As for offshore tax shelters these should have been closed years ago as they are a fraudulent instrument put in place for the rich to avoid paying fair tax in their country. Perhaps they need to be shown the door. Starting with our own PM.
    TREBOR
    27th Jul 2018
    6:10pm
    Anyone resident of Australia with an offshore account pays $30% on any transfer offshore or back onshore.....

    We have our exits and our entrances..... and one man in his time pays many taxes....

    ALL 'first world' nations that are suffering from 'tax havenitis' are moving to close those doors...... most of them just haven't had the balls to decide what to do and then do it.... that kind of rapid forward movement requires a Castro - and he gets labeled a
    Communist for putting Cubans first....

    Get out and about - see how the world really works.... then we'll talk....
    Rae
    28th Jul 2018
    9:18am
    O'Dwyer is correct. The banks can utilise the worker's money better providing long term funding to prop up their dodgy books and over indulgent lending over the past two decades.

    Someone has to cop the losses and it won't be LNP mates. It will be the workers again.

    The biggest mistake is thinking they give a damn about you other than you being a money milking machine. Once that's over you're a liability.

    Especially all the ones who insist on Fix interest "safe" investments haha. I'll bet a lot of advisers have clients in those positions making money for the banks, paying fees and earning under 2%.
    Old Geezer
    27th Jul 2018
    1:27pm
    With super funds their are lots of mouths to feed. You put money in and get charged a fee. Your advisor gets a fee. The person deciding where your money goes gets paid a fee. The person investing you money gets paid a fee. The person making sure and changing your investments gets paid a fee. The person reinvesting your money gets paid a fee. The person doing all the book work and accounting gets paid a fee. OH I forgot the person sending out your statements by email or snail mail also gets paid a fee.

    No wonder you have nothing left when you retire.
    TREBOR
    27th Jul 2018
    1:32pm
    So a one-stop shop would be ideal?

    Thanks, OG...... like privatised roads and power etc, once the one-stop government shop was cheaper and more efficient and required far fewer 'staff', board members and overpaid executives to feed.... and NO gluttonous shareholders and opportunities to rort taxation due via franked credits on which nobody pays tax.

    Worked wonders....
    Old Geezer
    27th Jul 2018
    1:45pm
    Ha aha Trebor showing your ignorance of what franked credits are once again I see. Get your facts right man.
    MICK
    27th Jul 2018
    2:52pm
    Actually OG YOU are showing your ignorance.
    Example: I earn $1000 and employ somebody to do some work for me. With the payment that person employs somebody to do some work for them.
    Please tell me where I get a franking credit because all 3 of us are paying tax on our income? Please don't start with the GST as this is not income tax!
    You are right TREBOR. I use the imputation credit system but it is a special RULE which only exists in Australia and was once again.....wait for it.....put there for the top end of town to suck suck on the system. It should go!
    Anonymous
    27th Jul 2018
    2:54pm
    Blatantly obvious that Trebor and Mick are rusted on labor who do nothing but criticize the LNP government
    Been reading all your post the last few days and it’s clear that you 2 are labor trolls
    Sad
    TREBOR
    27th Jul 2018
    2:59pm
    Nah - I just set you up - "franked credits on which nobody pays tax." is a part, not the whole - and you fell for it hook line and sinker.

    I note you didn't deny that this occurs - I've read the blurbs - and it seems that a company may voluntarily pay tax on franked credits......... and we all know there is murk in this practice - or it would not even be there in the first place, just like trust funds.
    TREBOR
    27th Jul 2018
    3:00pm
    Not at all, olbie - I stick it to all political parties equally - and vote for none - I don;t hide behind any Mr Pike - "Moi Politicks is Moi own concern!"
    Old Geezer
    27th Jul 2018
    3:07pm
    Trebor franking credits are tax paid by a company and are not created out of thin air.
    TREBOR
    27th Jul 2018
    5:45pm
    I am aware of what they are, OG - the theory is that the company pays 30% to the ATO in advance against the shareholders future tax - just like company tax - and it is supposed to ensure that the 30% is safeguarded so the ATO can collect it if necessary, and it is supposed to be included in all income for the shareholder for tax purposes, and a possible refund given if required in the reviewing of overall tax burden.

    Once again - it seems that in too many cases this is not what is occurring and it has become an automatic refund of that 30% - meaning nobody is paying tax on those shares.

    The whole issue needs looking into very closely - and if there are too many problems - let everyone just pay their own tax and see how they find that.

    Theoretically if the company pays tax as part of its taxation liability, and uses share payments as a deduction, there is no reason for a shareholder to not pay tax on that money.

    Somewhere along the way - some of this is being rorted - and if you are one of the honest taxpayers operating with a honest share-paying company- you will not be caught up in any changes at all.

    Dividend imputation is not and should never be an automatic return of 30% to the shareholder.... and it appears some of 'the big boys' - from whom your kind are excluded - are basically cheating.
    TREBOR
    27th Jul 2018
    5:47pm
    If you like it this way - dividend imputation on shares paid is the same as tax withheld on behalf a PAYE worker - it is part of gross income and not a separate figure at all.

    If it is being treated as a separate figure from gross income - it is a rort.
    TREBOR
    27th Jul 2018
    5:47pm
    The mere fact that many bodies suggest it as a 'tax minimisation strategy' is enough to indicate it is being rorted.... same as trust funds.
    Rae
    28th Jul 2018
    9:27am
    While dividends have been popular and lucrative OG they may not be so great going forward.

    I only hold that one direct share in Origin and they stopped dividends two years ago. I'm switching to solar panels. More reliable after all.

    Cutting losses is part of it as you know.

    I've made 23% on foreign indexes just straight old fashioned sharemarkets last financial year.

    Mostly capital gain which may be something you consider.The halving of that tax was a gift to investors.

    Dividend plays in Australia may be losing gloss with added sovereign risk. The ASX isn't so terrific now either.

    It's getting harder to know which banks are in strife. Holding a lot of bank shares is a pretty big gamble at debt levels of 200% GDP.

    There should be no entry or exit fees at all for superannuation. At least let those sucked in get out with a bit of capital left is my opinion.
    ex PS
    30th Jul 2018
    10:49am
    olbaid, disagreeing with someone makes a person neither a troll nor a supporter of one particular party. A mature and reasoned argument is more productive than mindless name-calling.

    27th Jul 2018
    1:47pm
    At the end of the day the only thing that matters is nett returns
    So long as my retail funds continues to average returns of over 10% I’m happy
    But I would like to see all funds made to publish exactly how those returns are made up for each individual asset class
    ex PS
    30th Jul 2018
    10:59am
    I am in an Industry Fund that does exactly that and includes the fixed annual charge as a percentage of the fund value. I converted my Industry Super Fund into an income fund 5 years ago and have drawn a good income with the balance increasing every year since the conversion. Having Union input on the board has done no harm in my case.
    LieDetector
    27th Jul 2018
    1:53pm
    To Jackie and Old Geezer...Unless you are or were in an Industry Fund AND in a retail fund you have no basis for your opinion on Industry performance. Industry has employee AND employer representatives keeping a close eye on where the money is parked and the monthly review to see what was missed and what was a winner. Movement in the stock market, property market, money market and foreign markets are all watched and responded to through careful calibration of computer systems. A locking mechanism is employed to prevent rogue transactions and alerts are triggered to put transactions on hold until they are fully scrutinised. Industry Fund managers and their workers do not have their income tied to dubiously earned bonuses. It is a co-operative and client/employee-focused with board members being voted into their positions by members. No such operation in retail.Look at how banks have treated super where their employees who worked as advisers and who, in some instances and maybe in many instances were subjected to performance indicators that had to show clients taking up "bank run" super and not better performing competitors' funds. Some advisers quit in disgust and others complied enthusiastically and got to go on all expenses paid holidays and drive fast cars. There is no armor against logic like ignorance.
    Old Geezer
    27th Jul 2018
    2:23pm
    I had both retail and industry super funds and was not happy with any of them. Yes I read the report and as a statistician I crunched the numbers as well. I didn't like the performance or the numbers of any of them. So I set up my own SMSF and even tough I invest in similar assets my performance leaves the rest for dead. The only explanation I can give for this is fees or something else. I just don't understand how pension funds and accumulation funds can have the same returns especially those with lots of equities. Something is very fishy going on in both retail and industry funds.

    Please explain how a lackie like me can out perform both industry and retail funds by such a wide margin year after year.
    inextratime
    27th Jul 2018
    2:44pm
    Sheer Brilliance OG, sheer brilliance.
    MICK
    27th Jul 2018
    2:53pm
    So Industry Funds earning > 10% pa are not good enough? What are you investing in? Drugs?
    Old Geezer
    27th Jul 2018
    3:09pm
    I would not be happy with their returns Mick.
    Old Geezer
    27th Jul 2018
    3:12pm
    Mick I merely pointed out why I have a SMSF and don't use other funds instead.
    TREBOR
    27th Jul 2018
    5:49pm
    Mafia Insurance Enforcement and Short Term Loan Recoupment - invest today and 50% return guaranteed....
    Anonymous
    27th Jul 2018
    6:04pm
    Old Geezer - you are obviously not investing in the industry funds “cookie-cutter” options
    Their offerings are bland and formulaic
    Boutique fund options offered by some retail funds or choosing your own mix within the retail funds is a better way to go if you don’t want the bother of an smsf
    TREBOR
    27th Jul 2018
    6:16pm
    There are high risk and there are low risk investments..... if the industry or other super funds are paying out 10-12% you can guarantee they are making as much as OG etc claim - at least - but some of it is being sidevented for 'fees' to advisors and investment agents and administration costs - apart from the regular costs to the basic contributor.

    I wouldn't hold any SMFR who claims 20% in high regard - no more cunning than the funds themselves - it's just that the funds take some of the profits earned before it reaches the contributors - just like companies do with shareholders...

    If shares were based entirely on annual profit percentage - many would be minus at the moment.... companies that claim an honest operating loss and then pay dividends is like a householder operating at less than meeting bills income and then giving a gift to friends and family.

    Frankly bizarre.

    Come on, OG - tell me ow I have no idea how companies work...
    TREBOR
    27th Jul 2018
    6:19pm
    Oh - 'industry funds' are a Union business.... (hello) - they return a share to the Union.... it's part of their financial /revenue structuring...

    This is one reason why I am uneasy about Unions running super funds..... and other things - they become the very enemy they are supposed to be opposing.....

    What was it they say? A good copper eventually becomes the same as those he pursues for crime.... which was the theme of Cruising with Al Pacino.... went undercover to catch a gay killer and ended up being sexuality challenged and killing the gay killer the same way as the gay killer killed....

    Truly the bind moggles....
    TREBOR
    28th Jul 2018
    12:13am
    "Please explain how a lackie like me can out perform both industry and retail funds by such a wide margin year after year. "

    ... because you don't have shareholders to pay out every damned day..... only a CEO and sole beneficiary .... capisce?

    Why is it so hard for a few here to understand that the net market return by a fund is not the same as what it gives out to its 'members''?

    A fund could buy shares in Mafia Insurance Collections Inc and get 50% return a week - and still only pay 10% to its 'members'..... capisce? Like running a business....... capisce?

    I thought you knew the ropes, OG.....

    Also for your portfolio, OG - you've had cancer twice or more as a result of chemicals in your work - so you were a contractor of some sort = not a wage earner..... maybe ran a panel beater shop or whatever for yourself to suck in chemicals .. I knew one such who suffered dreadfully ...... you have no idea of the position of the ordinary worker.

    You don't get chemical issues = cancer from being a whiz kid in advising how to set up a retirement fund.
    VeryCaringBigBear
    28th Jul 2018
    7:49am
    Agree some cancers maybe the result of toxic working conditions but many are not. Many women get breast cancer and most don't work in toxic industries. Many men get prostate cancer and work in office jobs.
    TREBOR
    29th Jul 2018
    12:05am
    OG's tale is that it was the result of chemicals with which he worked...... 'nuff said..... it's his story...
    Old Geezer
    30th Jul 2018
    4:03pm
    Trebor I have never worked with chemicals. I was an accountant and computer specialist so other than maybe a bit of cock roach spray I was not exposed to any other chemicals.
    floss
    27th Jul 2018
    2:50pm
    O.G. if your nose gets any longer it will fall off.The garbage that falls out of your mouth astounds most people .
    Old Geezer
    27th Jul 2018
    2:53pm
    Ha ha Floss. Unfortunately I can't be worried about your ignorance myself.
    MICK
    27th Jul 2018
    2:54pm
    Ha, ha, ha. Yeah...OG is full of BS. Sorry OG but it's true. Go to Party HQ and complain!
    Old Geezer
    27th Jul 2018
    3:08pm
    Why Mick I am not one for lodging complains. I stick up for myself instead.
    Anonymous
    27th Jul 2018
    5:34pm
    my smsf nett return for 2017/2018 13.37%, the year before 14.5%, still not a bad return when banks pay less then 3%
    TREBOR
    27th Jul 2018
    6:20pm
    Chicken feed - an industry fund that pays 12% as mine did earns more than that.....
    Anonymous
    27th Jul 2018
    7:55pm
    tremor your answer just sums up the mental capacity so sorrowful lacking by thinking 12% is more then the 13.37% nett gain I received, however how great it is to see the likes of tremor being granted access to these columns, may it be under the alias of dumber and dumber, it just shows up the stupidity of his comments and I expect labor mickey to come to his rescue, #agree tremor, you are right Labor mickey etc" as I have said before, some people, the likes of tremor/labor mickey, must have appreciated and celebrated to be last in line when brains were allocated, ah well, sorry but brains don't grow on trees even less on rusted on labor stoogies!
    TREBOR
    27th Jul 2018
    9:52pm
    DUH - 12% after costs and fees have already been skimmed = more than your 13.37% you claim......

    English not your first language? Don't read or write too well for someone with such a magic touch with money.... let alone apply reason and comprehension of what is written.

    Makes you wonder, eh? No wonder this society is failing when people who have no understanding of what is written in front of them and cannot even use capital letters are 'self-funded retirees'.......
    TREBOR
    27th Jul 2018
    9:55pm
    I honestly pity you, heemie.... such limited horizons coupled with a nasty and self-promoting temperament.

    You and OG should get together and organise a super fund - you'd rake in billions for yourselves and your clients....
    TREBOR
    27th Jul 2018
    10:03pm
    Let me try to liberate your thought a little, heemie - OG .... all superannuation funds, including industry ones, are 'businesses' - they have ';shareholders' and such to satisfy.

    In the case of industry funds - the shareholders are (as I said elsewhere on this page - a matter that gives me concern) 'shareholders and receive benefit.

    Easy enough to see that if a person such as yourself and OG could see a 'good thing' in the market - they would also - but their actual return to members does not have to be the actual return on their investments on behalf of those members - capisce? Like any other business - THEY determine the level of their 'dividend'.... so it stands so reason that if a fund pays 12% it is actually making more on the 'market'... same as you.

    So no need to crow about your expertise and cunning skills - others do it too - the ISSUE here in amongst all your hyperbole is the fees and management charges that currently accrue to superannuation funds...... precisely my point.

    Do try to keep up.

    " mental capacity" - hilarious to have you even mention such a term.

    Not that hard, eh?
    TREBOR
    27th Jul 2018
    11:56pm
    Sorry - that was 'unions and receive benefit'...
    Knows-a-lot
    27th Jul 2018
    5:10pm
    Anything involving money is bound to involve corruption and exploitation.
    Anonymous
    27th Jul 2018
    5:16pm
    Correct Knows-A-Lot
    The union reps on industry funds are just as capable of corruption and exploitation as those running retail funds

    There’s ample evidence of the former - many should be behind bars
    TREBOR
    27th Jul 2018
    5:54pm
    I agree olbaid..... where there is corruption it should be punished.... the Union movement says so.... the Labor Party maybe not - but the Union movement says so...but then, Labor has semi-divorced itself from the Union movement now....

    BTW - if businesses could be relied upon to do right and play by the rules - there would be no need for Unions and government regulation.. however, since the company store and the robber barons of yesteryear went out of fashion 150 years ago - let's not hear any continued ranting for a free market capitalism again....

    It's long dead.. and even in FDR's time, companies paid 50% tax and executives were limited to ten times the pay of a worker and nobody failed to prosper.....

    All dead arguments based on self-greed support huge remuneration of what are essentially either failures or vandals of industry, and only a fool advocates unrestricted market force capitalism as the only law of the land.
    Not a Bludger
    27th Jul 2018
    5:26pm
    Every good reason to have one’s own SMSF - costs are limited to stockbroker, accountant and audit fees.
    Anonymous
    27th Jul 2018
    5:36pm
    never a truer word spoken
    TREBOR
    27th Jul 2018
    5:55pm
    Works well for those with sufficient capital to make it work - like most such things it doesn't work for the majority...... even the money advisors say you must have a minimum to even start up.... and like every market - if everybody did it, there'd be no market....
    Not a Bludger
    27th Jul 2018
    8:05pm
    OMG Trebor - you really listen to so-called advisors - rent seekers all.
    TREBOR
    27th Jul 2018
    9:46pm
    So ... er... you started yours on an income of $45k or so?
    TREBOR
    28th Jul 2018
    12:00am
    (ahem) with no other assets?

    So you are recommending that all the kids who work at MacFries part-time etc should become SMF handlers?

    While I agree with the principle that it seems to those with sufficient that an SMF is the way to go - very few actually have that option....

    Unless you are a business operator, you have no choice but to be part of the PAYG system.
    TREBOR
    29th Jul 2018
    12:07am
    Maybe the Macca's kids should all develop share portfolios out of their discretionary income.......... surely that'd help them all to become SFRs.......
    Rae
    30th Jul 2018
    7:59am
    Yes it would TREBOR. Maybe if they just saved up and started to buy shares. My youngest did exactly that while at uni, working security and stacking shelves at Target.

    All I did was pay his union fees which aren't compulsory now.

    No he didn't live at home but in a share house in the suburbs.

    He bought into cochlear back at the beginning and made enough for a deposit on an apartment.

    He didn't get his hands on his PAYG superannuation which has all disappeared into the fees and charges. He may be 70 before he sees any of that if it still exists by then. He's 36 now.

    He used discretionary money and saved bit by bit.

    Apparently a $10 000 investment in index shares left to run over the last 50 years is now worth millions. Money invested early beats money poured in late every time.

    All that money wasted on private schools and fancy sports might be better off just growing so the child ends up having a prosperous retirement. Or builds up a deposit for housing.

    Not in Superannuation though. It's too fraught with sovereign risk and gouging by the FIRE industry. Most young people don't expect to see much of it left at the end from their experiences with it while working those student jobs.
    Chooky
    27th Jul 2018
    6:03pm
    As the banks have proven they are completely corrupt, the pressure on industry funds from the LNP federal government led by Banker Turnbull may ease.
    The banks want to get their grubby hands on industry super and the head banker PM ???? is all for it. Industry super funds perform way better than retail funds.
    PM ???? might just back off helping his banker mates now.
    Chooky
    27th Jul 2018
    6:03pm
    As the banks have proven they are completely corrupt, the pressure on industry funds from the LNP federal government led by Banker Turnbull may ease.
    The banks want to get their grubby hands on industry super and the head banker PM ???? is all for it. Industry super funds perform way better than retail funds.
    PM ???? might just back off helping his banker mates now.
    Anonymous
    27th Jul 2018
    6:08pm
    INdustry super funds perform better than retail funds - incorrect Chooky
    GrayComputing
    27th Jul 2018
    7:04pm
    A few years ago I was losing well over half of my super which was then with MLC.
    MLC were still charging me thousands of dollars each year whilst losing over $100,000 of my superannuation fund.
    My financial adviser closely tied with MLC did nothing.
    A lot of funds were locked in and could not be extracted till many years later at a huge loss.
    I consider that the whole private superannuation scheme started by Keating has been a massive loss to all working Australians not just me.
    Of course the money was not really lost but ended up making some other companies and share traders even richer
    I dare and challenge the committee to calculate and publically declare the total money loss to all the Australian superannuation contributors over the last 10 years.
    I strongly suggest superannuation be allowed to go into the Australian Future fund which has done so much better than any and all of that bunch of merchants pirates who lied and called themselves good superannuation companies on TV whilst I and other were losing billions.
    Anonymous
    27th Jul 2018
    8:14pm
    as they say " a fool is soon parted of his/her money"
    Rae
    28th Jul 2018
    10:18am
    Funds within superannuation should not be locked in. Part of investment strategy is to be able to retrieve capital efficiently. It's why traders set stop loss on positions. Any investment where capital is locked in is risky.

    Hindsight is wonderful. We all make mistakes and it is part of the learning curve. I wouldn't call you foolish Gray just badly advised.

    MLC was once a respectable firm our parents recommended. I had insurance with them for years and they were terrific when my husband was killed.

    We learn to check the details and I get my solicitor to read the contracts now as it's worth the fee.

    Superannuation should never have exit fees in my opinion.

    She of the instruments being sold prior to the GFC were not fit for purpose. Even the big firms didn't see the risk coming.

    I found one product I held for decades with MLC only returned 25% of the promised pay out.

    It's why I learned to invest for myself and to keep it out of superannuation with the huge risks and government rules. I'd rather pay tax. At least you know where you stand with the ATO.

    27th Jul 2018
    8:12pm
    tremor all you can come up with is excuses, excuses, we all know you have been able in the past to get rid of posts detrimental to yourself or labor mickey/tremor, just for once become a person who can prove to be able to stand on his/her own feet without being a slave to the labor party or having to be guided by our labor mickey who by the way will desert you as quick as the opportunity arises of stabbing you in the back
    TREBOR
    27th Jul 2018
    9:49pm
    Totally wrong, heemie - as usual. I offer a solution to the current failing superannuation system which destroys smaller accounts with fees and such.

    Are you finding it hard to follow the discussion of fees and charges costing superannuants a fortune?

    Your paranoia about being trashed by YLC management goes beyond all reckoning..... no individual can get rid of your comments - only those who run the show. Virtually everything you say above is paranoid nonsense....

    Where do you get these ideas about people and organisations such as unions?
    TREBOR
    28th Jul 2018
    12:18am
    AND I've stated many times and posted contrary views to Labor many times... I hold no brief for ANY party - I am merely an honest broker seeking to find a path through all the bulldust that surrounds government and governance in this nation - and part of governance is the current failing and woefully inadequate and falsely handled superannuation system.

    You seriously need to get out more......
    MD
    27th Jul 2018
    8:22pm
    Very interesting - the (third last) para re BT Financial that is. BT is linked to Westpac and the Westpac Group's other shop fronts.
    Yesterday - 26th inst, in a phone conversation with a BT Financial Advisor I was quoted $2300 for (presumably, and I quote) "10 hours of research to look into (our) affairs and draft an investment plan to suit your needs". Furthermore, when questioned relative to ongoing annual cost, we were quoted a similar amount. The initial 'consultation' (meet and greet) is gratis.

    How then am I to make sense of the .15% asset admin fee and the $540 pa flat account fee?

    Unlike certain others that regularly crow about their financial and investment prowess, comparatively speaking, some few of us may be considered naive in wealth matters so maybe those financially wise and learned can enlighten us in this matter.

    "O, what a a tangled web we weave when first we practice to deceive" - Walter Scott.
    TREBOR
    28th Jul 2018
    12:05am
    By George! I do believe he's got it!!! 100% correct - most don't know the ropes and often have little to no time to learn them in between earning enough to eat etc... so perhaps our learned quorum could give out a few secrets - no fees of course..... (snuckles).... the only 'choice' a wage earner gets is to choose which fund......... not whether or not to opt out and become an SMF character.

    Was that Walter Scott? Sort of sounds like Rabbi Burns without the Heelandt verbiage... as in 'gang oft aglay'...
    Rae
    28th Jul 2018
    10:56am
    I wouldn't touch it with a barge pole. That is $230 an hour which I'm sure you can better with an independent advisor. Ask your accountant to recommend one. Then check them out. Find out hourly fees and if they receive commissions.

    The .15% asset admin would be the cost of the platform BT uses to access index funds and products. Which you can do yourself or any advisor can do for you.

    If you just want plain vanilla share and bond indexes then paying huge amounts to BT seems unnecessary. Also research BT Financial carefully. They did not do well in a correction from my recall.

    $540 seems harsh. My platform accounting fee was less than $300 for the year. Everything was done for that including fees for my taking profits out and the preparing annual tax statements and quarterly return statements.

    Make sure you can get out to transfer if you need to without heavy exit fees or locked in positions.

    A lot of the Industry Funds offer free initial investment plans and an annual free assessment.

    A good solicitor and an independent advisor you can trust . A good accounting firm often have their own advisor right there and so that research is easy and cheaper perhaps.

    Check out Vanguard. A low cost index fund manager set up by Warren Buffett's partner Bogle to cater for the small folk and allow then cheap access to index funds for passive investment.

    Ask the adviser you choose about BT, Vanguard or any other fund they may recommend.

    Just make sure you don't get locked in and no advantage is made of your risk profile.

    Regardless of beliefs you can lose capital in fixed interest ( Bonds) and it isn't cash in a bank deposit account. Receiving 2% odd because you think it is really safe when it actually isn't is something people are waking up to now.

    Debt markets are quite risky after all these years of excess.

    I'm still investing in Bond indexes but my eyes are wide open and I'm checking movements daily now.

    You need a manager who is on the job for you and their firms reputation.

    Remember to diversify. And the first and second rule of investing. Don't lose Capital.

    Go check out the economics section of your library too. There are plenty of books explaining how superannuation and how different markets work.
    And read Benjamin Graham.
    MD
    28th Jul 2018
    3:31pm
    Thanks for that Rae, very informative and whether or not it's obvious I am not considered a big time investor (or a small time one for that matter). As it is, I'm barely motivated by the almighty $, just so long as sufficient exists for the basics.
    The BT 'sell' fell on deaf ears...literally!

    I wish you a happy retirement.
    MD
    28th Jul 2018
    3:40pm
    Mmmmmaybe the SMSF fraternity could be in for a rough ride Trebor, oh and btw it's "gang aft agley" if you'll forgive my pedantics.
    Maybe just another case of the mouse that roared.
    TREBOR
    29th Jul 2018
    12:13am
    Yes - the SFRs could be in for a rough time... there is no stoning that a government will leave unturned.

    What amazes me constantly is how they can even consider some of the moves they do, knowing full well it will impact adversely on many.

    That's why I'm here, basically - to try to elucidate problems and generate answers - and the first answer is to divest ourselves as a nation of this Government of Two Parties bent on their selfish ideology and paid to pursue it by us.

    I didn't say I was always right - I learn from what people say... but I demolish ad hominems that some here thrive on as their only means of discussion.

    'gang aft agley' - sounds right....
    VeryCaringBigBear
    28th Jul 2018
    7:51am
    Thank goodness I cashed in all my super years ago and it paid for the houses of my Grand kids. Best thing I ever did now with the talk of death duties as they have the full benefit of my wealth without paying any taxes on it.
    TREBOR
    29th Jul 2018
    12:16am
    Well done - I guaranteed my kid's future many years ago too.... I felt the movement in The Force after placing my ear to the rail of political direction... and divested myself of assets including private superannuation... now I have nothing.... but I do well and so do my kids....


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