Retail super funds have kept a lead in terms of consumer satisfaction compared to industry super funds, after lagging behind for over a decade.
Roy Morgan Research found that in July 2017 satisfaction with retail super funds was at 58.7%, compared to 58.2% for industry funds. This follows from the March 2017 survey, which also found retail funds had slightly higher satisfaction that retail funds. Prior to this industry super funds had been in the lead since the survey started in March 2003.
Though individual industry super funds still have higher satisfaction, with no retail super fund in the top five funds ranked by satisfaction with financial performance.
SMSFs have higher satisfaction that either retail or industry funds, at 73.8%, though this could be due to their higher balances.
“The overall lead in satisfaction among SMSFs is a result of the fact that they really only operate with larger balance accounts, where satisfaction for all super types is higher. By contrast, industry and retail funds also operate with lower balance accounts such as the under $5,000, where satisfaction is less than 50%,” said Roy Morgan Research.
“Although SMSFs are the clear satisfaction leaders in the $700,000+ segment, they are not so dominant in the $250,000 to $699,999 segment where competition is very close among the three major fund types. In this segment, industry funds lead with 72.6% satisfaction, followed by SMSFs (71.8%) and retail funds (68.9%).”
Norman Morris, Industry Communications Director for Roy Morgan Research, said: “This research has highlighted the need to measure members satisfaction by account balance, because for example the $700,000 and over group although only accounting for only 3.9% of fund members holds 23.8% of all superannuation funds. It is in this segment that SMSFs are having major success against industry and retail funds.”
“Although industry funds have held a lead in satisfaction over retail funds for a decade or more, it now appears that retail funds have closed the gap and in fact taken a narrow lead mainly as a result of gains where fund balances are $250,000 or more but also showed some improvement in the $5,000 to $100,000 range. Industry funds have lost some ground in satisfaction over the last year in all segments under $700,000 but made some minor gains over that amount.”