Superannuation: CANSTAR 2016 Ratings Released

CANSTAR releases annual Superannuation Star Ratings report today, assessing 68 public offer superannuation funds.

CANSTAR’s analysis of more than 100,000 visitors that have actively searched for specific superannuation funds on the canstar.com.au website over the past 12 months has uncovered some insights into what consumers are looking for with regards to their superannuation.

“Getting workers engaged with and interested in their superannuation still remains a challenge but it’s great to see that more than 100,000 individuals have researched their superannuation options on CANSTAR’s website alone over the past year,” said CANSTAR General Manager, Wealth, Josh Callaghan.

“In particular there are certain superannuation topics that have enduring appeal, attracting thousands of readers each month. Top of the list is the difference between retail and industry funds, which is a distinction that seems to confuse many people. Superannuation fees are also a hot topic, and life insurance within superannuation rounds out the top three most popularly-searched topics.”

Looking for low fees

CANSTAR has collated the data on the minimum, maximum and average fees across the 68 superannuation products included in its 2016 Star Ratings and has calculated the annual cost of those fees across various account balance scenarios.

“Reassuringly our research found that most providers are offering competitive fees and premiums; certainly there is plenty of competition in the market,” said Mr Callaghan.

“Even small differences in fees can have a significant impact on an investor’s end balance though, unless that fee is offset with a correspondingly higher return.”

Based on the growth asset allocation funds assessed by CANSTAR, the range of annual fees was as follows:

 

Super Balance ($) Average Fees ($) Min Fees ($) Max Fees ($)
$25,000 $275 $133 $678
$80,000 $838 $449 $2,321
$140,000 $1,405 $727 $3,966
$200,000 $1,966 $997 $5,609
$500,000 4,669 $2,249 $13,830

Fees include Administration Fees and Indirect Cost Ratio (including Investment Fee, Performance Fee and other indirect costs). Fees are calculated based on the average super balance specified, based on growth portfolio funds assessed for CANSTAR Superannuation Star Ratings 2016.

Insurance costs

Life insurance within super is a popular topic, both in terms of CANSTAR visitors reading articles about the issue and visitors actively searching for superannuation funds that include the option for income protection.

“More than one-quarter (26%) of the more than 100,000 visitors using our online filtering tools over the past twelve months are specifically looking for a super fund that includes income protection,” said Mr Callaghan.

“Anecdotally, many funds have been telling us that there is a far greater awareness of insurance cover through super now, compared to several years ago.”

The table below provides the average cost of insurance across the different ages and cover amounts. Note that the sum insured amounts specified below differ between age groups; these sum insureds are based on industry feedback as to the typical level of default life cover at different ages.

  Age (Years) Amount of Life & TPD Cover ($) Average Fees ($)
Starter 25 50,000 48.61
Builder 35 200,000 228.49
Established 45 200,000 504.95
Pre-Retiree 55 100,000 765.44
Wealth Accumulator 45 200,000 504.95

Source: www.canstar.com.au
Premiums listed are based on the specified level of Death and TPD cover and age, for a non-smoking white collar and light blue collar male and female.
These figures are reflective of the rates collected for the CANSTAR Superannuation Star Ratings 2016.

Which Funds offer Outstanding Value?

CANSTAR’s 2016 ratings rates 68 superannuation products that are directly available for individuals to purchase without an intermediary (e.g. a financial planner), and only those Funds which are available to the public.

  Profile Recipient
Outstanding Value Superannuation Starter Award Starter EISS Super

ING DIRECT – Living Super

ANZ Smart Choice Super

Bendigo SmartStart Super

Sunsuper for life

First State Personal Super

 Outstanding Value Superannuation Builder Award Builder Bendigo SmartStart Super

ANZ Smart Choice Super

EISS Super

Sunsuper for life

ING DIRECT – Living Super

First State Personal Super

AustralianSuper Personal Super Plan

Outstanding Value Superannuation Established Award Established Bendigo SmartStart Super

ANZ Smart Choice Super

AustralianSuper Personal Super Plan

Sunsuper for life

First State Personal Super

EISS Super

Outstanding Value Superannuation Pre-retiree Pre-Retiree Bendigo SmartStart Super

ANZ Smart Choice Super

AustralianSuper Personal Super Plan

Sunsuper for life

IOOF Employer Personal Super

EISS Super

 Outstanding Value Superannuation Wealth Accumulator Wealth Accumulator ING DIRECT – Living Super

Bendigo SmartStart Super

ANZ Smart Choice Super

AustralianSuper Personal Super Plan

Sunsuper for life

Club Plus Super Personal Division

AMP Flexible Super Choice

CANSTAR congratulates all winning Funds in the 2016 Superannuation Star Ratings. Read more about CANSTAR’s 2016 superannuation research.

 

For further information:

Justine Davies

Editor in Chief

Ph. (07) 3837 4151  |  0400 127733

justine.davies@canstar.com.au

 

About CANSTAR

CANSTAR provides Australia’s interactive online research service in consumer and business finance. Founded in 1992, CANSTAR Pty Limited is Australia’s researcher of retail finance information for over 250 institutions such as Banks, Building Societies, Credit Unions, Finance Companies, Brokers, Mortgage Originators, Life Companies and finance related Internet Portals. CANSTAR customers use the extensive database for competitor analysis as well as a means of disseminating their product range. CANSTAR also distributes this information to print and electronic media for publication and to Agents, Accountants, Brokers and Internet Portals for use in advising their clients.

What are the CANSTAR star ratings?

CANSTAR researches, compares and rates the suite of banking and insurance products listed below. Results are freely available to consumers who use the star ratings as a guide to product excellence. The use of similar star ratings logos also builds consumer recognition of quality products across all categories. Please access the CANSTAR website at www.canstar.com.au if you would like to view the latest star ratings reports of interest.

Account based pensions Managed investments
Agribusiness Margin lending
Business banking Online banking
Business life insurance Online share trading
Car insurance Package banking
Credit cards Personal loans
Deposit accounts Reward programs
Direct life insurance Superannuation
First home buyer Term deposits
Health insurance Travel insurance
Home & Contents Travel money card
Home loans Youth banking
Life insurance

COMPLIANCE DISCLOSURE and LIABILITY DISCLAIMER

To the extent that the information in this report constitutes general advice, this advice has been prepared by CANSTAR Research Pty Ltd A.C.N. 114 422 909 AFSL and ACL 437917 (“CANSTAR”).  The information has been prepared without taking into account your individual investment objectives, financial circumstances or needs.   Before you decide whether or not to acquire a particular financial product you should assess whether it is appropriate for you in the light of your own personal circumstances, having regard to your own objectives, financial situation and needs.  You may wish to obtain financial advice from a suitably qualified adviser before making any decision to acquire a financial product.  CANSTAR provides information about credit products. It is not a credit provider and in giving you information it is not making any suggestion or recommendation to you about a particular credit product.  Please refer to Canstar’s FSG for more information.

The information in this report must not be copied or otherwise reproduced, repackaged, further transmitted, transferred, disseminated, redistributed or resold, or stored for subsequent use for any purpose, in whole or in part, in any form or manner or by means whatsoever, by any person without CANSTAR’s prior written consent. All information obtained by CANSTAR from external sources is believed to be accurate and reliable. Under no circumstances shall CANSTAR have any liability to any person or entity due to error (negligence or otherwise) or other circumstances or contingency within or outside the control of CANSTAR or any of its directors, officers, employees or agents in connection with the procurement, collection, compilation, analysis, interpretation, communication, publication, or delivery of any such information. Copyright 2014 CANSTAR Research Pty Ltd A.C.N. 114 422 909

The word “CANSTAR”, the gold star in a circle logo (with or without surmounting stars), are trademarks or registered trademarks of CANSTAR Pty Ltd.   Reference to third party products, services or other information by trade name, trademark or otherwise does not constitute or imply endorsement, sponsorship or recommendation of CANSTAR by the respective trademark owner.

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