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Industry super satisfaction creates fiduciary headache

A superior satisfaction rating from industry fund members creates a fiduciary headache from planners who are usually more inclined to recommend retail funds, according to Roy Morgan Research.

The Roy Morgan Research Superannuation Satisfaction report found the satisfaction level of industry super fund members was 50.8 per cent, while the figure for retail superannuation funds was 45.5 per cent.

The gap had diverged significantly since around 2007, with the sectors fairly close prior to that. SMSFs were well ahead of both sectors at a rating of 71.6 per cent.

Norman Morris, industry communications director at Roy Morgan, said the retail sector would increasingly have to depend on its adviser network to retain customers due to the ease of switching super funds and the increased rate of people using SMSFs.

“The relatively poor long-term performance of the retail funds, however, is of concern, as there is a very clear fiduciary responsibility for financial planners to act in the best interests of their clients, and yet financial planners are more likely to direct their clients to retail funds,” said Mr Morris.

The report is based on interviews with 50,000 people per year, 30,000 of whom have superannuation, for 10 years.