Super funds have opportunity in financial advice: report
More than a quarter of super fund members are looking for help on how to grow their super balances, providing an opportunity for funds to offer financial advice, according to a new Investment Trends report.
The Investment Trends 2016 Member Sentiment and Communications report – which draws on a survey of 20,800 super fund members across Australia – shows that 30 per cent of members are “somewhat confident” they could fund their retirement future from superannuation.
Meanwhile, 25 per cent said they are “not sure”, while 20 per cent are “a bit nervous” and 15 per cent are “not at all confident”, the research found.
“More than a quarter of super fund members are specifically seeking help on how to grow their super balance, an opportunity for super funds to finesse their financial advice offering and assist members with a better sense of direction,” the report states.
The report also confirmed that fund switching activity had decreased to the lowest level in seven years.
An estimated 900,000 members left a super fund in the past 12 months – an 11 per cent decrease on the number of members who left a fund in 2015.
“Super funds are now starting to reap the rewards of their concerted member engagement activities over recent years,” Investment Trends senior analyst King Loong Choi said.
While members’ interest in their superannuation picks up at the age of 40, younger members who do engage with their superannuation want to interact with their fund via a wide range of channels, the survey found.
“Gen Ys who care to engage with their super want to access it the same way they access all the other services they use, including via social media and online chat services,” Mr Choi said.
“The sheer range of engagement channels and approaches that need to be considered to engage younger members present a significant challenge for many super funds, if only on an expense level.
“However, the risk versus reward trade-off of developing these services is worth considering in an environment where competition to attract and retain members has become more and more fierce.”
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