A concerted effort by Vision Super to ramp up the financial advice it provides has coincided with an increase in positive cash flows, roll-ins and retention rates.
The number of financial advice meetings with fund members jumped from 1,431 in 2014 to 2,422 in 2015 – an increase of almost 70 per cent.
In addition to these meetings with financial planners, the fund has seen an increase of 34 per cent in salary sacrifice and an increase of 18 per cent in roll-ins from other funds.
There has also been a 45 per cent increase in retention rates in pension accounts.
“Members have developed some great benefits with Vision over the years, it is quite a generous benefit arrangement, we don’t want them cashing it out and paying tax for the rest of their life if it’s not in their best interest to do so,” Stephen Rowe, chief executive of Vision Super, said.
Since he started as chief executive in 2014, Rowe has been implementing a cultural and structural transformation of the fund.
“On the cultural side I saw the real need to introduce a high touch personal service on financial planning and advice generally, trying to go to the nth degree to assist members in understanding what product they were in and what sort of product they might go into as they approached retirement,” he said.
In the last 12 months the fund has held 13 expos at council buildings in metro and regional Victoria, meeting with around 3000 members. It has also held 248 employer seminars at workplaces.
“A lot of the leads and opportunities are generated here. If we see 250 people at an expo we might get 60 or 70 people having a financial planning meeting at a later date,” Rowe said.
General advice is provided to members for free. For more complex advice, the first meeting is free. Vision Super advisers then discuss a fee up front with members so they can decide before signing up to the advice – $875 covers a basic statement of advice (SOA) with around 3 strategies. $1,750 covers a complex plan with multiple strategies.
“This is well below the market place, but we are covering our costs in doing that. As we get people through the system we will then be in a position to review that pricing structure,” Rowe said.
He said the fund plans to increase its financial advice by a further 40 per cent over the next year, adding that while it was ambition he felt the fund could build on the momentum it has developed.
As part of that strategy the current team of 12 people offering financial advice is due to expand, as Rowe is yet to be convinced by the offerings of robo-advice.
A fund with a different perspective is Equip Super, which announced a partnership with clover.com.au, a fintech startup focused on the development of digital advice and investment management platform.
Equip chief executive, Danielle Press, said: “We believe super funds have no option but to integrate fintech into their service offer. We certainly do not intend to be left sitting on the sidelines as member demand for online enablement makes offering these services essential to surviving and thriving in the financial services sector.”
Clover anticipates that its service, which offers a goals-based approach to advice provision and portfolio construction, will go live by mid-2016.