Super fund change needs financial planner ?

So I have a fairly high fee super fund with AMP and want to move it to a simple ASX equities fund or tracker with less than 1% total fees and no entry or exit fees. Email inquiries to AMP result in a contracted out financial planner wanting to help me do it... even though it is possible to switch funds with AMP online but I just cant find any with low fees.

Whats the catch with the financial planner insisting on skype calls and personal service ? Is it only them that can negotiate low fee fund switches within AMP ? Will I get caught paying trailing commissions forever ? Anyone recommend any other low fee equity super funds? Thanks.

 

Planners cannot get trails anymore.

 

Perhaps AMP is the problem. No need to speak with financial planners.

I just switched and now pay $300 p.a. regardless of the amount in my super.

 

Is that a private industry fund or something open to the public ?

 

ING living super. There are four options, shares costs 300 p.a plus trading costs. Can have 80% capital in shares you pick and 20% in one stock, Can buy VAS, IOZ and maybe two LICs if you just want to index the Aussie share market or near enough. 20% can be put in there fee free find which is 50% shares and 50% cash giving 90% total in shares.

Cheapest option I have found. Takes 10 mins to sign up online.

 

One word springs to mind "Insurance" and how much he can sell you!!

 

Hey Casteller. I work in the Superannuation Industry and have PM'd you. I'm not a financial planner, don't worry

 

Do you find it's worth the hassle of buying stocks vs a super fund that offers index options?

 

All I'm buying is a couple of ETFs and specific LICs. Log in once a quarter and top up in 5 mins. Eliminates fees of about 0.66% p.a. over the 30 years to retirement so that would be about 21% of my super gone in fees.

So yeah worth the 5 mins a quarter.

 

When I did the sums against SunSuper's index options the difference in fees was $273/yr cheaper in favor of ING for a super balance of $300k. For a super balance of $100k they were identical.

Assumptions: 4 trades/yr with ING, average MER for ETFs/LICs 0.12%, average MER for SunSupers index options 0.17%

But I take your point about the 5 minutes of work a quarter. Just need to weigh up the benefits of having LICs in the portfolio versus simplicity of index only (no manual intervention) in exchange for slightly higher fees.

 

That's some low super fees, mine were almost 4x as much at 0.66% total.
ING you can only invest 80% yourself and the fee free option is 50/50 cash and shares so you have 10% earning interest which throws things out if you are indexing the lot.

My criteria was low fees and flexibility to pick my own stocks, planning to follow the Peter thornhill industries approach with some international exposure added in. Couldn't find anything cheaper than ING, though I'm certainly no guru on super.

 

Would you happen to know what happens from a CGT perspective when converting from a super account to an account based pension account? In know there's in specie transfers but I don't know how it gets treated tax-wise. Ideally I want to pay $0 tax for the LICs/ETFs I've held for 30 years.

 

No idea. Rules will be different by the time I have to deal with them. @Shawn might be able to add some insight

 

HI @CatCafe

Very interesting question. This depends on which fund your in and how they handle your assets.

QSuper recently launched the Income account transfer bonus - which is very similar to what your talking about for Managed Investment options within the fund.

Income account transfer bonus | QSuper

I am aware that a few platforms will also allow you to transfer the ETFs/LICs via in-specie transfer. Not sure who they are specifically though

 

Thanks Hodor for the information. Are you saying with ING, you;re only paying a total of 300 pa excluding trading costs? I currently have 2 superannuation funds from switching jobs, now just need to consolidate into 1.

May I ask for the ING super, where does it put the initial money that is coming from my employer? Is it just cash by default? or I can select which share to allocate e.g. 50% on VAS and 50% on AFI.

Thanks again. IBP

 

Yes, 300pa plus trading costs.

80% balance in direct shares (max allowed) and 20% in the fee free option (which is 50 50 shares and cash, selected by ING)

You can select which option the cash goes to automatically by % of contribution. Unfortunately it can't automatically buy the shares, it just sits in the "cash hub" which is where it draws from to fund share purchases. I plan to log in 2 to 4 times a year and to up.

 

Just found this

Self Managed Super Funds | SMSF - Esuperfund

Haven't looked too closely at it, those looking at a cheap SMSF option might be interested appears to cost $799 a year and lots of flexibility at a glance.

If I hadn't opened ING living super I would have looked closely at it.

 

They've been around for quite awhile now. I've looked into them a number of times but you had to use their broker etc and the fees were a bit high in the past. Just looking now the fees are more competitive. They get a commission from the broker, trading CMA and other products which enables them to offer the cheap annual fee.

It's also a great site to learn all about SMSFs.

The feedback I have seen is generally good but you need to have a bit of an idea of what you're doing. They are basically an administrative service provider hence you may not get much in the way of advice. But their online knowledgebase in excellent.

My accountants fee is fair so due to loyalty I stick with them. However if fees got too high Esuperfund is the administrator I would likely consider moving to.

Do a Google search on it to seek out some more recent feedback on them. It's been awhile since I last did this but as stated on average it was positive.

Unlike some other options mentioned here there shouldn't be any restrictions on LIC SPP participation etc. Flexibilty and choice is excellent.

In summary, for self-directed investors willing to learn a bit about SMSFs (available on their website) it's an excellent option worth considering.

Not advice, general info only.

 

Interesting.

Correct me if I have not understood correctly.

Say my super balance is $100K and I open ING living super account with Shares option.

- So I can invest $80K into shares with no more than $16k (20%) into any one share.
- $20K sits in fee free option (Do I earn any interest??) where it is split 50-50 between cash and shares. So in our case $10K in cash and $10K in shares which sits in cash hub. Does the cash hub earn any interest? Are you allowed to later invest $10K in shares into shares of your choice?

My main interest is finding out how much as a percentage of your super balance you cannot invest in shares directly and need to keep aside in things like cash.

Cheers,
Oracle.

 

The fee free option is actually a "balanced" unitised investment which consists of 50% cash 50% shares. Like any other unitised option, earnings will be credited as additional units. The cash hub sits outside of this. The cash hub earns a tiny bit of interest.

Your personal/SG contributions and dividends from direct shares will add to the cash hub balance which can then be used to purchase additional shares, but remember only 80% of your overall portfolio can be in direct shares.