Superannuation fund members are more concerned with paying a lower rate of fees than receiving a wider range of services such as advice and access to information, according to the results of a Mercer survey presented at the Association of Superannuation Funds of Australia (ASFA) conference in Adelaide by Mercer principal Elyssia Silberstein.
Investment performance and competitive fees were ranked as the two most important factors for a super fund, according to the survey of 509 fund members representing a wide range of ages and account balances.
Other services, such as access to face-to-face advice, web-based information and other web-based tools, were also important, but the majority of members surveyed believed they should only have to pay for services that were used infrequently, such as face-to-face advice.
Older members surveyed were more likely to favour greater access to fees in exchange for more services. Older members were also more likely to report a higher awareness of the fees they paid and were also more likely to believe the fees they paid were reasonable.
Half of those surveyed preferred to pay a flat monthly fee while a quarter favoured a fee based on their level of interaction with the fund.
Australian Administration Services (AAS) chief executive John McMurtrie said there was a disconnect between trustees and members, and he also questioned the value of intra-fund advice.
Only a small percentage of calls to AAS related to intra-fund advice, which he said was not very useful as a form of engagement.
“If you can’t talk to a member in the accumulation phase about a retirement product you’re missing an opportunity to guide that member through your own products,” he said.
In terms of a member’s willingness to pay for services, McMurtrie said while they valued services such as advice, [members] were rarely prepared to pay for it. It is a similar story with investment choice and insurance, he said.
Generally, if a fund did not provide Statements of Advice (SoAs) for free then the take up of SoAs fell to virtually nothing, McMurtrie said.