The independent analyst SuperRatings has named a major corporate fund, Telstra Super, as the best value for money fund in the Australia’s $1.8 trillion retirement funds business.
It is unusual to have a corporate fund on the top of the rankings because industry super funds generally perform better for members because of lower fees and a better focus on members.
The investment community thinking is that corporate super funds generally don’t give members more than baseline requirements.
However, for the financial year just ended Telstra at 15.8% beat the average 12.7% return for the 12 months.
All the other funds with top returns are industry funds.
In this new rating, SuperRatings says it spent five months looking for a fund with the strongest end-to-end solution, covering both the accumulation and pension phases.
Areas getting in-depth analysis included investments, fees, insurance, administration, advice and governance.
Adam Gee, CEO of SuperRatings, says Telstra Super has had an amazing year, performing consistently well across all key assessment criteria.
Telstra Super also has invested heavily in administration, member education and advice services, all of which are areas which have proven challenging for some funds.
“Whilst the fund is only open to employees of Telstra and their immediate families, we had to recognise its performance as a clear standout of the industry,” Gee says.
Overall, SuperRatings says the majority of funds across have been improving products, services and value for money.
“Despite comments to the contrary, our analysis shows that retirement adequacy continues to improve for members, albeit at a gradual pace,” SuperRatings says.
The research is the most comprehensive undertaken every year and covers more than 100 MySuper, 320 accumulation, and 170 retirement products in 2014 across all major mainstream super funds.
The top 10 funds (out of 320) for the accumulation phase:
The top 10 funds (out of 170) for the retirement/pension phase: