Consumers want to make it easier to consolidate their accounts and read their superannuation statements, according to new research from the Association of Superannuation Funds of Australia (ASFA) released today.
A survey of 1,023 respondents, conducted by CoreData and commissioned by ASFA found while around half of respondents said they are likely to consolidate funds in the next two years, at least one in five (19.2 per cent) don't know how to consolidate their super fund accounts.
Excessive paper work, exit fees and differing rules and requirements were the greatest challenges people identified when it came to consolidating their accounts.
When it comes to reading superannuation statements, only one in four (24.5 per cent) respondents claimed to have a 'very good' understanding of the information provided, with many people struggling with terminology, how fees are calculated, and understanding investment returns. Tables, graphs, and figures were also identified as areas where consumer understanding was low.
Consumers also indicated they would like to see more information in their statements, such as a thorough breakdown of administration fees, tax deductions and dividends and a chart of the projected income or overall performance.
When it comes to insurance through super, 41.3 per cent said they have a poor understanding of their options, with two in five respondents stating they don't know how to choose or change their insurance option through their fund.
ASFA CEO Pauline Vamos said: "Over the last few years, the level and quality of information provided by individual funds to members has increased markedly, but clearly we need to think of different approaches as there are some significant gaps when it comes to fund members understanding how their super works.
"While it's encouraging to see that members are thinking about consolidating their accounts, and want to know more about their fees and insurance, they still do not appreciate that help is often just a phone call or web click away. These findings are a call to the funds to connect more deeply into the general community to really get the messages across, raise awareness and educate fund members so they can make better-informed decisions regarding their superannuation accounts and their retirement.
"In response to these findings, ASFA, as the peak body for the industry, will also run a series of campaigns directed at addressing the knowledge and awareness gaps identified regarding consumers understanding superannuation. We look forward to sharing further details regarding these campaigns in due course," Ms Vamos said.
"We also realise that, at present, funds are quite restricted in terms of the information they can provide to members and how it can be presented. Therefore, it's time we seek the regulatory changes necessary to ensure information can be delivered to fund members in a way that helps them make decisions to plan for their retirement."
The survey also found that an increasing proportion of respondents prefer using an online portal to monitor their super balance (44.4 per cent), as opposed to hard copy statements (31.3 per cent).
"In this digital age, it's unsurprising that fund members are showing an increased preference for online information about their superannuation. This presents a great opportunity for funds to create innovative and interactive platforms for members to better engage with their super, and provide them with a greater number of tools and information they need to achieve the best retirement outcomes," Ms Vamos concluded.
The research report is available at www.superannuation.asn.au/policy/reports.
For further information, please contact:
Lisa Chikarovski, Media Manager, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia's superannuation industry. It is a not-for-profit, sector-neutral, and non-party political national organisation whose aim is to advance effective retirement outcomes for members of funds through research, advocacy and the development of policy and industry best practice.