New research has been released suggesting members of retail superannuation funds are happier than their counterparts who are members of industry funds, but only if they have lower account balances.
In a finding that runs counter to commonly-held beliefs, the latest Roy Morgan survey found that in the six months to March 2017, satisfaction with retail superannuation funds was 60 per cent compared to industry funds with 57.3 per cent.
The survey analysis noted that this was the second consecutive month that retail fund satisfaction had been higher than industry funds, which up to now had held the lead for over a decade.
The Roy Morgan survey covers over 50,000 consumers a year and includes coverage of 30,000 superannuation fund members.
It found that over 12 months to March 2017, retail superannuation fund satisfaction increased by 3.0 percentage points to 60 per cent, followed by self- managed funds up 2.6 percentage points (to 76.2 per cent), public sector funds up 1.7 per entage points ( to 68.6 per cent) and industry funds down 3.2 per cent (to 57.3 per cent).
It said the strong improvement in satisfaction for retail funds put them ahead of industry funds for the first time since 2003, when the survey began.
Commenting on the survey result, Roy Morgan communications director, Norman Morris said that although satisfaction with retail superannuation funds was now higher than industry funds for the first time in over a decade, it was important to recognise that this had mainly been as a result of gains among lower value clients
“This is possibly due in part to the introduction of the no-frills, low-cost MySuper products over recent years which appears to be mainly impacting on the less engaged, lower value customers who didn’t actively select an investment option but are now more satisfied with their returns,” he said.
“The relative satisfaction levels across competitors in the $250,000 plus group needs to be closely monitored because they hold 58.3 per cent of all superannuation funds and yet only account for 17.3 per cent of members,” he said.
Morris pointed out that currently, self-managed super funds led in satisfaction among this group with 78.2 per cent, followed by industry funds on 70.2 per cent and retail funds on 69.2 per cent.
“It appears from this that retail funds with balances of $250,000 or more remain under threat from both industry and self-managed funds,” he said.