CANSTAR’s analysis of more than 100,000 visitors that have actively searched for specific superannuation funds on the canstar.com.au website over the past 12 months has uncovered some insights into what consumers are looking for with regards to their superannuation.
“Getting workers engaged with and interested in their superannuation still remains a challenge but it’s great to see that more than 100,000 individuals have researched their superannuation options on CANSTAR’s website alone over the past year,” said CANSTAR General Manager, Wealth, Josh Callaghan.
“In particular there are certain superannuation topics that have enduring appeal, attracting thousands of readers each month. Top of the list is the difference between retail and industry funds, which is a distinction that seems to confuse many people. Superannuation fees are also a hot topic, and life insurance within superannuation rounds out the top three most popularly-searched topics.”
Looking for low fees
CANSTAR has collated the data on the minimum, maximum and average fees across the 68 superannuation products included in its 2016 Star Ratings and has calculated the annual cost of those fees across various account balance scenarios.
“Reassuringly our research found that most providers are offering competitive fees and premiums; certainly there is plenty of competition in the market,” said Mr Callaghan.
“Even small differences in fees can have a significant impact on an investor’s end balance though, unless that fee is offset with a correspondingly higher return.”
Based on the growth asset allocation funds assessed by CANSTAR, the range of annual fees was as follows:
| Super Balance ($) | Average Fees ($) | Min Fees ($) | Max Fees ($) |
| $25,000 | $275 | $133 | $678 |
| $80,000 | $838 | $449 | $2,321 |
| $140,000 | $1,405 | $727 | $3,966 |
| $200,000 | $1,966 | $997 | $5,609 |
| $500,000 | 4,669 | $2,249 | $13,830 |
Fees include Administration Fees and Indirect Cost Ratio (including Investment Fee, Performance Fee and other indirect costs). Fees are calculated based on the average super balance specified, based on growth portfolio funds assessed for CANSTAR Superannuation Star Ratings 2016.
Insurance costs
Life insurance within super is a popular topic, both in terms of CANSTAR visitors reading articles about the issue and visitors actively searching for superannuation funds that include the option for income protection.
“More than one-quarter (26%) of the more than 100,000 visitors using our online filtering tools over the past twelve months are specifically looking for a super fund that includes income protection,” said Mr Callaghan.
“Anecdotally, many funds have been telling us that there is a far greater awareness of insurance cover through super now, compared to several years ago.”
The table below provides the average cost of insurance across the different ages and cover amounts. Note that the sum insured amounts specified below differ between age groups; these sum insureds are based on industry feedback as to the typical level of default life cover at different ages.
| Age (Years) | Amount of Life & TPD Cover ($) | Average Fees ($) | |
| Starter | 25 | 50,000 | 48.61 |
| Builder | 35 | 200,000 | 228.49 |
| Established | 45 | 200,000 | 504.95 |
| Pre-Retiree | 55 | 100,000 | 765.44 |
| Wealth Accumulator | 45 | 200,000 | 504.95 |
| Source: www.canstar.com.au
Premiums listed are based on the specified level of Death and TPD cover and age, for a non-smoking white collar and light blue collar male and female. These figures are reflective of the rates collected for the CANSTAR Superannuation Star Ratings 2016. |
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Which Funds offer Outstanding Value?
CANSTAR’s 2016 ratings rates 68 superannuation products that are directly available for individuals to purchase without an intermediary (e.g. a financial planner), and only those Funds which are available to the public.
The winners of the Superannuation Star Ratings are:
| Profile | Recipient | |
 |
Starter | ANZ Smart Choice Super |
 |
Builder | ANZ Smart Choice Super |
 |
Established | ANZ Smart Choice Super |
 |
Pre-Retiree | ANZ Smart Choice Super |
 |
Wealth Accumulator | AMP Flexible Super Choice
AustralianSuper Personal Super Plan |
CANSTAR congratulates all winning Funds in the 2016 Superannuation Star Ratings. Read more about CANSTAR’s 2016 superannuation research.
