Your Thoughts on My Super

Discussion in 'Superannuation, SMSF & Personal Insurance' started by Realist35, 15th Jan, 2018.

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  1. Realist35

    Realist35 Well-Known Member

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    Evening all,

    I've got zero clue about super, different investment options available etc. and decided to look into it a bit deeper. Below is my current portfolio with Plum, so called aggressive option:

    - 41% Australian shares,
    - 30% Global shares,
    - 22% Global shares (hedged),
    - 3% Global listed property,
    - 4% Alternatives and other (defensive).

    Other details:
    - Investment management fee 0.52%,
    - Indirect cost ratio 0.23%,
    - Goal is to outperform CPI +4% after investment fees and taxes over a 10yr rolling period,
    - Average return over last 5 years has been 12.3%.

    Would love to hear your thoughts about cheaper/better options out there. And I will view them as just thoughts, not an advice.

    Thanks :)
     
  2. Nodrog

    Nodrog Well-Known Member

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  3. Hodor

    Hodor Well-Known Member

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    There are definitely cheaper products available, so you can improve on this.

    Better is a matter of opinion. Other funds offer investment options with similar asset allocations.
     
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  4. Marg4000

    Marg4000 Well-Known Member

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    Depends on your age.

    Younger people can afford to be more aggressive as they have the time to recover from any downturns. Closer to retirement, preservation of capital becomes more important.
    Marg
     
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  5. Realist35

    Realist35 Well-Known Member

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    Thanks Hodor.

    I just had a quick look at Australian Super. They have something similar called high growth option, with higher fees (0.85%) and marginally higher 5yr growth. I'll keep looking though.

    From what I've seen, the growth of my investment option seems really good.

    What split between Australian and international did you choose for super if you wouldn't mind sharing?
     
  6. Goodison

    Goodison Active Member

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    Hi Realist, keep in mind that the Plum portfolio asset allocation you just posted is 100% listed assets (or appears to be so).

    One of the large differences between this kind of retail fund and an industry fund like Australian Super will be that the allocation in the industry fund will typically have a greater proportion of unlisted/less liquid assets (think direct unlisted property, infrastructure, private equity etc).

    If you have a look around you will probably notice that the industry funds in general are able to/willing to invest a greater proportion of members funds in these unlisted/direct assets and alternatives like private equity compared to retail.

    Now have a think about how listed markets have performed in general over the last 5 years (the time period you are currently comparing). And think how this may influence performance metrics in the period you are looking at.

    Now have a think about the different performance outcomes should listed markets have increased volatility in the next 5 years.

    I guess what I am trying to say is ... sometimes just comparing performance over a particular time ... can mask other things.
     
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  7. pwnitat0r

    pwnitat0r Well-Known Member

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    Can you link me to their performance on their website? I had a look and it's extremely difficult to find - could be a reason for that.
     
  8. ShireBoy

    ShireBoy Well-Known Member

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  9. sash

    sash Well-Known Member

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  10. Realist35

    Realist35 Well-Known Member

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    Hey guys,

    Just spoke to Plum guys to clarify this. Basically they are a corporate super fund used by around 100 companies. It's not a personal fund hence they don't publish the investment options on their general page.
     
  11. Lawrence Barnes

    Lawrence Barnes Well-Known Member

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    Better option than retail funds is to create your own SMSF which you have control over. Not to mention you can use leverage to increase your returns. Many benefits to just sticking your money in these funds and hoping they do well.
     
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  12. Hodor

    Hodor Well-Known Member

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  13. pwnitat0r

    pwnitat0r Well-Known Member

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    Any kind of fund that doesn't have their historical performance easily accessible and viewable gets about 2-5mins of my time before I conclude they want to hide their returns and classify them as rubbish.
     
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  14. sash

    sash Well-Known Member

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  15. Goodison

    Goodison Active Member

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    Hi Sash, AMP CustomSuper is not a wrap facility. It's what a lot of people may typically refer to as a master trust.

    You may notice on the AMP website that AMP CustomSuper is no longer used for new accounts (it is an older product).

    If you go to the AMP website you will note that the current employer super fund is SignatureSuper. Which replaced CustomSuper for new corporate plans.

    Also on their website, you will see that MyNorth is their current wrap platform being offered.

    Have you compared your CustomSuper account against MyNorth or SignatureSuper?
     
  16. sash

    sash Well-Known Member

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    nope...ok... it is still an umbrella fund where you chose the product.

    the fees are hard to understand..from what i can see the only reason i would be there is a subsidized income protecrion and death cover plan. ourside of 5hat i would prefer something less complex

    also the company is reviewing this so changes maybe afoot....

     
  17. Realist35

    Realist35 Well-Known Member

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    My understanding was that SMSF only make sense once my total capital is over 250k. Could be wrong, I remember reading this somewhere..
     
  18. Chris Au

    Chris Au Well-Known Member

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    Question is, you gotta start somewhere, either outside SMSF and if it's an investment that grows, you will have to sell, with CGT, to move that money into the SMSF, or grow the funds inside the SMSF.
    You gotta set up the vehicle first, then carry it through to completion, or at least know the path you're going to travel to the finish line (and what costs that path will cost you).
     
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  19. Goodison

    Goodison Active Member

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    Hi Sash, your right, there all umbrella platforms where you choose the underlying allocation/product. It's also pretty tough to compare the fee structures.

    When it comes to banks and fin service providers like AMP and IOOF. My experience in general is that when they review their product range to make it more competitive and modern compared to competitors. They generally leave their existing book of clients in the older (and sometimes less competitive) products, invent their latest market leading/competitive product but only shift new clients to the newer one, preserving their fat margins on their older wealth book whilst still retaining market share of new business.

    Platforms like CustomSuper and SignatureSuper will typically have one single ICR now for each underying investment option, which should cover 98% of the fees.

    The difference between that and a wrap platform like MyNorth is you get beneficial ownership of the underlying investments in a wrap (transparency of franking credits and distribution of income/capital growth) which you don't get in platforms like CustomSuper and SignatureSuper.

    In addition, the fee structure in a wrap is split between the ICR of the investment options you choose and a % admin fee of FUM. Different to a master trust. There is some difference too between investment options (direct shares/ETFs/LICs/SMAs) are generally accessible on wrap platforms but not on master trusts like CustomSuper/SigSuper.
     
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  20. The Falcon

    The Falcon Well-Known Member

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    Spot on. If one wants to get access to these kind of exposures ; direct interests in real assets,PE, VC, Long-Short funds etc then industry super funds are the cheapest place to access high quality management as they have enough FUM and the team to do it. You can’t replicate this as an individual investor, but you can easily replicate index based strategies. Food for thought.
     
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