You may be comparing apples with apples in an industry fund, but some are achieving much higher returns than others, meaning that when one performs the compounding statistics over a working life, the difference between one industry fund and another can make a considerable difference to the retiree, as journalist Christine St Anne reveals this week. While industry funds claim that a planner is an unnecessary cost of administration, these statistics show otherwise.
How is an investor to decide which fund is performing better without the help of a planner? Can an investor easily check the fine details of the insurance policy within industry funds? Without even confusing the issue by adding 'oranges' or retail funds into the debate, there are real differences between funds. Industry funds are still the fastest growing segment of the super industry but retail funds continue to dominate with 32.4 per cent of the market. Anecdotally, more planners are recommending industry funds. But self-managed super funds (SMSF) are the ones to watch.
The SMSF Professionals' Association of Australia conference, scheduled for this week, had 700 delegates registered, far exceeding last year's number (500) and double the number of its inaugural year, 2005. SMSFs now account for 23.1 per cent of total super assets. It is important, therefore, that those people are receiving professional advice of the highest standard, not only from a technical and administrative perspective but also from an investment point of view.
The calibre of the conference speakers showed the importance industry is placing on this market sector, with politicians from both sides, the Australian Taxation Office, ASIC, Treasury, the Investment and Financial Services Association, accounting, insurance, financial planning, actuarial and the legal profession all represented.
