Imagine putting up your fees then back-charging your customers for the previous financial year? Hard to believe, but that’s exactly what Australian Super just did.
Tell me any organisation that at the end of the financial year is able to get away with going back to customers and telling them they are putting up their fees retrospectively, because they didn’t make as much money as they wanted?
That’s apparently what Australian Super is doing to its 2.3 million members. A mate of mine sent through a notification he received via email this week where he was informed Australian Super had “updated” their fees on July 9, which would apply retrospectively for the financial year ended June 2022.
Like it or lump it
Basically, “like or lump it… we’re doing it”. These 2.3 million customers had paid the old fees every month over the last financial year and looks like they’ll have the extra fees just deducted from their account as a top-up to the manager.
The reason given was that the fund had to pay stamp duty on some big infrastructure and property investments during the year. So what? Shouldn’t that be covered by existing fees?
Australian Super has over $260 billion under investment. Every member pays administration fees of a flat $2.25 weekly plus 0.04 per cent of their balance. PLUS they pay an investment fee on their balance depending on the investment option they’ve chosen.
Super funds need to be more accountable
As you know, I reckon superannuation funds should be more accountable and transparent to their investors. They manage $3.4 trillion of our money, the money of average Australians who are forced by law to contribute 10.5 per cent of their wage to superannuation.
But these superannuation funds have less governance and transparency than listed companies have to provide to their shareholders. Why shouldn’t they operate under the same rules?
- Listed companies have to declare the remuneration of their top executives… super funds don’t have to. Although the best will bury it in their annual report.
- Shareholders can vote against remuneration packages of executives… super fund investors can’t.
- Shareholders vote for board appointments… super fund members don’t.
- Listed companies have to inform the markets and shareholders of any material changes in their business… super funds don’t.
Super funds need more accountability
Even if you’re not with Australian Super, other funds have form too. If you haven’t checked your superannuation statement in a while, you might be in for a bit of a shock. There are five key reasons why:
- 13 super funds failed the APRA performance test last year. Was yours one of them?
- Almost 3 million works get ripped off through super every year
- If you’re a woman, your balance will almost certainly be lower than your male peers
- If you’re self-employed, your super balance is likely to be well-under average
- Most Australians currently don’t have enough super for a comfortable retirement
If you tick any of the above boxes, it’s time to reassess your super.
Change funds if you need to
If your super fund is underperforming, your best plan is to get out completely.
Find a top performing super fund, join up, then move your money across using the above ‘transfer super’ option. Shop around to find a fund that’s exactly right for you.
It’s always a good idea to compare super funds at least annually. That way you can be sure you’re in a fund that’s working well for you.
And, as demonstrated by Australian Super’s latest money grab, be sure to keep an eye on any fees you’re paying out!
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