The elephant in the room ... from today's SMH

[Gabriel Conroy]

Seems industry funds occupy the top 10 spots in the returns lists. However, they are rarely recommended by planners. Interesting! Best, Gabriel

http://www.smh.com.au/news/business/planners-order-up-an-extra-serving/2006/10/27/1161749311830.html

 

[redwing]

which are the Top 10 though

PS- Interesting article

 

[MPmelb]

Let's face it, most financial planners are primarily in that industry because they like making money - for themselves. And secondly it's good if the client does well too. If this is their thinking, there would be no reason to recommend industry super funds who do not pay commissions.

For a listing of the best super funds see www.superratings.com.au
For a listing of industry funds, see www.industryfunds.com

Maybe industry funds should make an effort to promote themselves better.

The flip side is that financial planners deserve to be paid too. Most people do not like paying fee for service, so financial planners receive their payments from commissions from managed funds for recommending their products.

If the consumer does not want fee for service or financial planners to receive commissions, it's up to the consumer to do the necessary homework on investments.

Unfortunately most consumers would rather spend more time researching the best car or shoes to buy than how to best invest their hard earned money. That is the dilemma.

 

[Aceyducey]

Unfortunately most consumers would rather spend more time researching the best car or shoes to buy than how to best invest their hard earned money. That is the dilemma.

Well generally investments don't make you sexier to the opposite agenda....until you have lots of them

Nor do they offer immediate gratification.

Shoes and cars on the other hand....


Financial Planners are doing a J-O-B. They need to earn money. For industry funds to be recommended by most of them (excluding a few people who become planners to help others) they need to offer trailing commissions to Financial Planners.

Of course this way they wouldn't be earning so well....

Cheers,

Aceyducey

 

[superkermit]

Not sure if I buy all those industrial super ads. Afterall, how much are they spending on advertising (at PRIME time)???

I looked into the industrial super vs private funds just last year when I started my own business, and found that although industrial funds do have lower fees, they also have fewer choices.

For example, I was deciding whether to put my money in Australiansuper vs Macquarie and wanted part of my money invested in Australian shares. Australiansuper has one managed fund for Aussie shares whereas Macquarie gave me 20 options.

Also $1 a week = 0.5% of $10,000 as an administrative fee. Macquarie charged me 0.75% administrative fee. So effectively my super portfolio with Macquarie needs to make just 0.25% over the industrial super fund for it to be more worthwhile.

I also found that the insurance option with industrial super funds really crappy. I plan to have a few properties and found that they will not be able to insure me for anything over $500,000 for death & TPD insurance. What's worse is the fact that my insurance premium will INCREASE each year but the sum payable in case of a claim will DECREASE

If you have a look at the definition of the insurance policies available under industrial super you will find that they are so far behind the standalone policies available in any private super funds.

So I think just like anything in life, you pay for what you get ...