A study commissioned by Australian Retirement Trust (ART) has revealed that while almost three in four Australians don’t know the current super guarantee (SG) rate, advised individuals were more likely to identify the correct figure.
The study of more than 2,000 Australians undertaken by YouGov found that 36 per cent of advised Aussies were aware of the SG rate compared to 28 per cent of those who don’t have an adviser and 26 per cent of those who have never seen an adviser.
In March, ART announced that it was planning to introduce a new advice offering to members, with the aim to help democratise advice.
This announcement comes amid discussion about the potential for super funds to amplify their role in advice. Namely, in the final report of the Quality of Advice Review (QAR), lead reviewer Michelle Levy proposed that banks, superannuation funds, and insurers should be permitted to offer limited advice without being bound by the best interest duty.
Instead, the QAR lead proposed the introduction of a good advice duty that would attach to personalised financial advice offered by the institutions, and greater flexibility in intra-fund advice.
“There are 16,000 licensed financial advisers in the country, so the numbers don’t square. So, we’ve got to find a way to deliver information and advice to members who are approaching retirement,” he told an Industry Super Australia event.
Minister Jones also noted that 5 million Australians were at or approaching retirement, who he said needed to be provided with access to information and advice.
While ART confirmed it did not plan to position itself in the comprehensive advice market, head of advice Anne Fuchs said in March that the fund would play a key role in ensuring more Australians get access to advice.
“We believe in open architecture advice. We believe advice is a very individual experience,” Ms Fuchs told ifa at the time.
“Superannuation has had traditionally a very paternalistic approach to advice. You can only come to us and it’s comprehensive advice and we think actually, the way of the future, with that spirit of democratisation is we just give them [consumers] options, so they can consume it how they want to consume it.”
Ms Fuchs indicated that ART was planning to announce its “end-to-end digital advice platform” — encompassing calculators, DIY advice, and human-led intra-fund advice — with an aim to launch it in the market by the end of next year.
Interestingly, in a recent opinion piece for ifa, licensed Australian financial planner and author Luke Smith suggested that super funds weren’t doing enough to educate their clients about their super. Mr Smith suggested that in order to fill that knowledge gap, advisers needed to step in and act as “the next line of defence” in helping super fund holders understand their options.
“If super funds won’t educate their members, then we as an advice profession should — from their first superannuation account, right through to their retirement and beyond. Like many financial planners, I just wish some of my clients had come to seek advice sooner,” Mr Smith wrote.
To read more from Mr Smith, click here.
