“Bridges will also provide financial advice for past HIP members who have moved into SMSFs and are struggling to manage the complexity and cost associated with administration, and would now like to move back to HIP where it is in their best interests,” he says.
The fruits of FoFA
The changing regulatory framework has also provided impetus to the push by industry funds to broaden the opportunities for members to seek advice.
On announcing the trial last year, AustralianSuper chief executive Ian Silk pointed to FoFA reforms as having created an environment in which the funds and planner groups could work together.
The suite of reforms that came out of FoFA, the Cooper Review and the Ripoll Report has provided transparency around fees and commissions, according to Silk.
Industry funds had previously been wary of the financial-planning groups because of fears that advice would push members to exit industry funds.
“AustralianSuper has always been a major supporter of good, sound advice. What we do not support is the commission structure of so many super products that leads to conflicted advice,” Silk said when announcing the trial in April last year.
Silk also saw financial planners as another avenue to increase members’ financial knowledge and engagement.
Research conducted by Rice Warner Actuaries shows that 20 per cent of industry fund members over the age of 65 have account balances in excess of $100,000.
Buttler says that this size of account balance is at the point where members can benefit from advice.
“While $100,000 is hardly enough to provide a comfortable retirement income on its own, it is at the point where retirees need to start considering their options,” he says.
The AustralianSuper board will consider the results of the 12-month trial at an August board meeting.