OPTIMISATION
Super is a personal asset. To effectively manage super as a wealth creation strategy, you must determine what you want to achieve for yourself (also known as setting goals and objectives). You must also monitor your progress against your stated expectations and adjust your strategy regularly because the value of your super asset can rise or fall, depending on investment markets.
Optimising your super asset requires making regular, informed, timely decisions aligned with your circumstances and market conditions.
The process involves analysing the potential outcomes, benefits and risks associated with available options to determine what best meets your needs and brings you closer to achieving your goals.
Unfortunately, financial literacy among Australians is varied, and research suggests that many people struggle with more complex financial dealings such as investments and superannuation, putting a high proportion of working Australians at a significant disadvantage.
Super optimisation involves an array of skills such as:
- Analysis of current and future product capability.
- Comprehension of rules around contributions, concessional & non-concessional.
- Knowledge of global economics.
- Construction of investment portfolios suitable for expected market conditions.
- Determination of appropriate insurance requirements.
Individuals who try to acquire such skills to manage and optimise super themselves can find it is a full-time job.
The challenge is not only in skills acquisition but in ensuring the maintenance of knowledge as market conditions evolve.
The SuperWiser client portal intends to meet the needs of everyday working Australians requiring access to affordable advice and service to help them avoid making common super mistakes and optimise financial outcomes for themselves over the long term.
Unlike holistic financial advice that includes all facets of an individual’s financial situation and can cost thousands of dollars, SuperWiser focuses on providing advice limited to super and costs between $0 and $220 (inc GST), depending on requirements.
All individuals with a super account are encouraged to use SuperWiser, even if only to complete a free Super Review.
CHOICE
A common and often costly mistake many individuals make with super is assuming that their existing super product will always be appropriate for them.
Remember, your circumstances are never static and constantly evolve. A super product that was appropriate 5 years ago (for example) may no longer be so now, especially if your circumstances involve a change of employer.
With the introduction of choice, more and more individuals often make the choice to stay with their existing super product rather than move their super into their new employer’s corporate superannuation plan.
Individuals who exercise choice and do not elect to join their employer’s corporate super plan, on review, may find they have mistakenly put themselves at a disadvantage.
Medium to large employers can go to market and gain a discounted fee structure and possibly cheaper insurance premiums to the advantage of their employees.
Individuals who exercise choice must conduct an appropriate analysis comparing their existing super fund against their employer’s corporate superannuation plan if they are to make an informed decision.
POLITICS
The federal government has decided it will use the nation’s pool of super assets to fulfil political goals such as solving the housing crisis and funding changes in power generation to meet climate management targets.
While the government has a voice in doing this, it appears that the owners of the asset (i.e. every individual with a super account) are silent on the issue, or their opinion is unreported, as all political parties have adopted the same policy.
Is super really a national as opposed to a personal asset?
Despite the government’s significant interest in using the nation’s pool of super assets to fund political imperatives, most individuals remain somewhat detached from their super, preferring to look at it once each year at statement time.
Perhaps this is due to a lack of knowledge about how super can be better managed and optimised to exceed expectations as a source of income in retirement.
SUPERWISER
The SuperWiser client portal provides access to affordable, expert advice and service specifically focused on assisting you to manage your super towards an optimal outcome.
SuperWiser can help you make informed decisions and avoid common (and often costly) mistakes.
Complete a free Super Review.
From there, you can obtain initial super optimisation advice (including implementation) for a one-off low cost of $220 (inc GST).
Alternatively, to discuss your options directly with an Adviser, book a time online, call 1800 467 467 or email yoursuper@superwiser.com.au
Personal or National Asset?
Super is an important personal asset, but many people fail to take the time to understand it or optimise it.
It seems that our options for managing it are reducing, and that politicians are more often talking about it in a way that is carefully crafted to dilute the idea of super as a personal asset.
Unfortunately, the idea of super as a collective national resource is becoming more widely accepted.
Politics of Super
Discussions between super platforms and the government occur regularly around how to spend/invest the nation’s $3.5 trillion of total super, and current political opinion supports super being available for investment in politically essential infrastructure projects within Australia.
But is this type of investment in the best interest of the individuals who own the asset?
Superannuation products have different ways of investing your money. One important difference is whether they invest in unlisted (not publicly traded) or listed (publicly traded) assets. Some people claim that unlisted assets are less likely to go up and down in value compared to listed assets. However, it’s not yet clear if unlisted assets really bring in higher average returns than listed assets, and the regulator is unlikely to examine this matter.
The government’s super investments are not publicly traded and are only valued from time to time. Some of these investments are considered illiquid, which means they can’t be easily turned into cash, a factor not reported on and understood by the public so far.
To a large extent, the public seems uninterested in the concept of super as a personal or national asset. Subsequently, they suffer the consequences with a suboptimal asset balance at retirement.
SuperWiser
The public needs to become aware of what’s happening with their super and learn how to manage this important personal resource. The first step is to find a reliable source of information and make well-informed decisions. But the challenge is that many individuals can’t or won’t pay a lot of money for comprehensive financial advice. As a result, they end up making decisions based on marketing rather than real facts.
There is a need for a high-quality, low-cost alternative to holistic financial advice and SuperWiser meets this need.
The SuperWiser client portal is a unique offering within the financial services industry. It provides workers in the accumulation phase of their super journey with access to quality information, service and advice to help them understand and cultivate their super as a significant personal asset.
Optimising Super
Optimal super outcomes do not materialise by accident. You must set goals, implement a strategic plan, review regularly and make updates as conditions dictate. The SuperWiser portal helps you easily manage all of this.
The first step is for SuperWiser to review your current super strategy (or lack of) and use this to calculate your baseline projected income in retirement and provide an indication for improvement.
The initial Super Review is free of charge, with no obligation to continue.
Should you decide to continue, you go through a process of confirming product selection, establishing tangible goals and objectives, implementing contribution and investment strategies based on personal advice recommendations and provided with account balance milestone targets.
A one-off cost of $220 (inc GST) is involved with setting up your improved super strategy.
Optimising super is not a set-and-forget exercise. It requires considered and consistent, active management every 12 to 24 months. SuperWiser automatically notifies you to review your super and will recommend updates to your super strategy in alignment with your goals and objectives and as market conditions dictate.
A one-off cost of $110 (inc GST) is involved with updating your super strategy.
Employer Plan or Personal Choice
When you commence work with an employer, you must decide whether to join the employer’s super plan (if they have one) or make a personal choice as to which product you want your super contributions paid into.
It is essential to access relevant information on which to base this decision.
SuperWiser can help you work out if joining an employer plan would benefit you. Choosing to stay with your existing super product (because it’s the easiest thing to do) without first comparing the benefits of joining an employer plan can be a costly mistake.
Have a Look
For younger workers, review your super (at no cost) and see if there is an opportunity to do better than you expected.
For workers with twenty years or less left in the workforce, use SuperWiser to manage your super asset so it is consistently better invested with future market conditions.
The Optimisation of Personal Super
The nation’s balance invested in super amounts to $3.5 trillion and growing.
When Paul Keating introduced the compulsory super in 1992, an industry sprang up to manage the ongoing creation of the asset. However, when you look at its history, it would appear that no one has been able to grasp how to manage this system as there has been an endless stream of controversy, re-regulation and punishments handed down to the super service providers.
The majority of people with a super account do not regularly examine their current plan until retirement. Such an approach leads to negative consequences for their projected income when they retire.
Essential Attention
If you are to optimise your super as a personal asset, you must first understand how your current plan delivers to ensure you have optimised profits:
- Your choice of product.
- The cost of your chosen product, including administration fees, investment fees and insurance premiums.
- Your level of insurance cover, dependent on your occupational classification and your current situation between assets and liabilities.
- What you can afford to contribute in addition to your employer contributions.
- Understanding your chosen investment strategy and what investment returns you can expect.
While the above might seem like a sizeable list, SuperWiser can evaluate your super plan for you and inform you of any new adjustments to your plan.
As a Source of Information
SuperWiser is kept up-to-date across a range of products and provides comparable results between products to ensure accuracy. Updates to the SuperWiser product database are regularly monitored and are also subject to scrutiny by the license holder’s Compliance Manager.
SuperWiser examines the projected income in retirement that might be achieved based on cost, contribution and investment returns. MySuper investment defaults are included for all products along with portfolios that can be constructed by using the products investment choice menu. Cost is a consideration with SuperWiser considering all fees and also insurance premiums.
Depending on government regulation around contribution caps, your future projected income in retirement can be enhanced by a modest salary sacrifice over the long term rather than a salary sacrifice bulked up in the short term.
In particular, one major difference is the active management feature in which the management of every person’s individual asset is in the reconstruction of investment portfolios over a 12-24 month cycle, instead of tthe static asset allocations of every platform’s MySuper investment default.
All of the above personal wealth creation services are offered at a fraction of the price offered by financial planners. The price of the various key services from SuperWiser are $220 to join and an additional $110 for each strategic update but you only pay if you use the actual service/update.
Success or Regrets?
In life, there are successes and regrets. The decisions you make (or not make) when you manage your super fund can end up in success or regrets. Set yourself up for success by managing your superfund well.
Contact Us
Register on SuperWiser or contact us on 1800 467 467 for a chat about how you can manage your super.
SuperWiser is a client portal for personal scaled advice, owned by Super Simpler Pty Ltd, a company started by the owners of AXIS Financial Group.
Both SuperWiser and AXIS Financial Group provide personal advice under Australian Financial Services License No. 233680, as owned by AXIS Financial Group Pty Ltd.
As a provider of personal advisory services to individuals, we have been operating for almost as long as super has existed. Our interest in developing technology began in 2014 and has progressed to our current capability to present our methods through our unique client portal.
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Improved Engagement Common Mistakes Young people starting out in employment have a lot to organise and some miss setting their super account up properly. A key component is providing your tax file number to your product provider. In the past, many people had multiple accounts and even lost contact with some accounts. The Government has been active in reviewing their controls to minimise the number of people with multiple accounts and in particular with insurances in each of these accounts. Many people are not investment specialists and assume their product’s investment default is the place to be. The more you learn about investment defaults the more concerned you might become about the sustainability of their returns and also how it would have been easier to make a decision which would have improved your asset balance noticeably. There is significant publicity about the quality of advice and also the cost of said advice. Indeed the government has tightened controls around advisory fees within super and taken measures to reduce the cost of advice. Many people have endeavoured to provide their own advice, some being successful but others not. Arguably insurance becomes a more significant cost from age fifty onwards but most people do not review their need for insurance. Essentially access to the right advisory service at the right time can increase your projected income in retirement by 10 to 20%, assuming you have a reasonable time horizon. If you are closer to retirement and have already accumulated a sizable asset, it is more about defending the asset you have accumulated and again with the wrong exposure to growth assets you can find you lose 10 to 20% of your asset just when you were thinking of retirement. Client Portal SuperWiser is such a client portal. It is automated and is specifically tailored to provide limited advice to Australian workers and their super asset. SuperWiser has a wide reach in that it can service employer super and also employees exercising choice of fund. The product database within SuperWiser has around 40 products between employer super, personal retail and industry funds. Service Model The fee for initial registration is $220 including GST. The services delivered at this stage would assist you in understanding your asset, the establishment of your goals and objective for your asset, confirming your product and advice around contribution and investment strategies. Your record is then in a secure database and you are part of an ongoing service model. You will be proactively advised if you need to update anything from an advice perspective. Future updates on strategies affecting your balance will be around $110 including GST. Importance of Regular Super Contact If you set a defined goal for anything, you have immediately increased the likelihood of success. SuperWiser assists you in monitoring progress by giving you milestones. What Next? For your information, SuperWiser is owned and funded by Super Simpler Pty Ltd, a private company with 5 individual owners. SuperWiser has no commercial relationship with any product. |