Vision Super has seen the amount of retirement funds retained to a pension product jump from $87 million in the 2013 financial year (49 per cent) to $226 million in the financial year to date (67 per cent).
The $7.6 billion super fund is projecting it will have retained $301 million by the end of the 2016 financial year.
Interestingly, while the dollar figures have increased dramatically, the number of members taking a pension product rather than a lump sum has not had the same increase, suggesting the take-up is from members with larger balances.
In 2013 the proportion of members taking pension products was 12 per cent. In 2015 this proportion had risen to 20 per cent.
Stephen Rowe, chief executive of Vision Super, said he was happy with this as pension products, including annuities, were not typically appropriate for those on low balances.
He attributed the rise in numbers to the financial advice the fund had been offering. Last year, Vision Super recorded a 70 per cent increase in the number of financial advice meetings with members compared with the previous year.
“The financial planning efforts, the retirement seminar efforts, the open-day efforts which have all been on foot for about 18 months now are really starting to have an impact,” Rowe said.
“We’ve also introduced an out-call function. So in addition to the basic welcome calls, we target certain areas of the membership and can call them directly – we don’t wait for them to come to us. And that’s also generating literally millions every month in contributions of various kinds.”
Rowe said the results should give the federal government food for thought when considering changes to superannuation taxation arrangements.
“We believe there is a clear link between the provision of advice that is in the best interest of members, and members making more responsible decisions about their retirement.
“This includes a better understanding of transition-to-retirement taxation arrangements.
“Rather than doing away with the taxation treatment of these and other superannuation arrangements, the government could achieve its budget savings by targeting unreformed areas of the system and corporations who don’t pay their fair share.”
He called on the government to rethink targeting working people’s super for budget savings, which have been the subject of over 20 major changes in three decades, and focus on areas that have been unreformed or made more generous – such as capital gains tax, negative gearing, company tax and family trust tax concessions.
Popular across Investment Magazine