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Rice Warner has developed a range of new calculators for Vanguard Investments which allow investors to compare fees between superannuation funds as well as managed funds. The superannuation fund fee calculator projects investors’ superannuation balance over a future period, and allows users to compare fees for up to two products. The calculator can be used to compare the fees of Vanguard’s Personal Superannuation Plan against other industry, retail or corporate super funds, and also allows users to compare super funds that are not offered by Vanguard. A second superannuation calculator projects both the superannuation balance to retirement and the income post retirement, including Age Pension payments.
For older users it calculates the affect on retirement income when adopting a transition to retirement strategy (TTR). A third calculator allows investors to compare the impact of managed fund fees on their future balance, producing a projected investment balance and allowing investors to adjust for a longer investment time horizon. Andrew McRae, senior analyst at Rice Warner, said all figures are discounted back to today’s dollars, with inflation set at 3 per cent. McRae said super funds are starting to demand technology that gives members a better idea of not only their likely balance at retirement but the impact that will have on their lifestyle in retirement.
“Eighteen months ago the super funds wanted a calculator that told members their projected super balance at retirement and how long the super will last,” he says. “Now, they want to know: what does that mean?” Colin Bold, senior consultant at Rice Warner, said the current environment had put a spotlight on the fees being charged by fund managers. “A lot of fund managers want to be more transparent,” he says. “It’s obviously in Vanguard’s interest because they’re low cost.
They’re making it more transparent for consumers to understand what fees they’re paying and compare [those fees].” AXA recently commissioned Rice Warner to develop a range of calculators for AXA Financial Planning, Charter and Genesys to support advisers during the advice process. The actuarial firm has developed calculators for Vision Super, Auscoal, Oamps Super, Local Government Superannuation, Local Super SA, Asset Super, and IFSA. In a treatise on appropriate asset valuations for super funds published last month, Rice Warner said any fund performance comparisons over less than three years were misleading and called for greater disclosure on unlisted valuation methods.