Industry super fund First State Super has refuted claims that its merger with VicSuper next month will see advice fees jump for fund members, stating that costs will be “consistent with the industry average”.
A spokesperson for First State Super, which purchased financial advice group StatePlus in 2016, said claims first reported in Nine/Fairfax Media that advice fees across the merged group would jump more than 30 per cent were incorrect, and that VicSuper members would still have the option to access intra-fund advice at no cost.
“Following the merger, comprehensive advice will also be available for all members in-house on a user-pays basis at an average cost of $2,500, which is consistent with the industry average,” the spokesperson said.
“In addition, members will have access to a broad range of in-house advice and support services to assist them with their more complex financial needs, including estate planning and aged care advice.”
ifa understands VicSuper members currently access comprehensive advice through external referral, a service that will be facilitated in-house through StatePlus following the merger. Costs under the new service structure could range from between $600 to $3,500 per client, depending on the complexity of advice provided.
It is understood that around 5,000 of the fund’s members get advice each year, representing about 2 per cent of the VicSuper membership base.
First State Super said with an increased focus on user-pays advice following the merger, overall fees for many of the fund’s members would go down.
“Following the merger, administration and investment fees will in fact decrease by 20 per cent for over 225,000 VicSuper accumulation members,” the spokesperson said.
ifa understands StatePlus advisers also currently receive bonuses, and that these are tied to a number of metrics including performance and compliance.
VicSuper and First State Super are due to merge on 1 July.
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