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Superannuation switching intentions highest among retail funds

Source: Roy Morgan Research “Superannuation and Wealth Management in Australia” report, 12 months to June 2013, n = 36,796. “Very Likely” to switch superannuation fund manager within next 12 months. “Very Likely” is one point on a five point scale also included “Fairly Likely”, “Neither Likely nor Unlikely”, “Fairly Unlikely” and “Very Unlikely”.
On average 5.1% of superannuation products are “Very Likely” to be switched in the next 12 months (up marginally from 5.0% a year ago). For Retail Funds, the figure is higher at 6.7%, compared to Industry Funds with 4.8%. The major contributors to the high level of retail superannuation fund switching intentions are the AMP Group, with 7.8% intending to switch, followed by the ANZ Group (7.5%) and NAB Group at 7.2%. These are the latest findings from the “Superannuation and Wealth Management in Australia” report.

Intended switching from Industry Funds overall is below the industry average, with 4.8% considering it “Very Likely” that they would do so. Of the various Industry Funds, HOSTPLUS has the highest proportion of its products “Very Likely” to be switched at 7.0%, followed by CARE Super (6.5%) and REST Super (6.3%). Intended switching from AustralianSuper, the largest Industry Fund in Australia, is comparatively low at 3.5%. Self-Managed funds are amongst the least likely to switch, with only 1.9% considering it “Very Likely” to switch in the next 12 months.

Intending to switch superannuation fund manager in next 12 months

Super switching intentions

Source: Roy Morgan Research “Superannuation and Wealth Management in Australia” report, 12 months to June 2013, n = 36,796.  “Very Likely” to switch superannuation fund manager within next 12 months. “Very Likely” is one point on a five point scale also included “Fairly Likely”, “Neither Likely nor Unlikely”, “Fairly Unlikely” and “Very Unlikely”.

Norman Morris, Industry Communications Director says:

“Overall intention for switching superannuation products has remained fairly steady over the last few years. However at a fund level, all three of the top retail funds with the highest intended switching have reported a higher proportion compared to a year ago (AMP Group: +1.2%, ANZ: +0.5%, NAB Group: +0.7%).

Apart from a change in jobs, the main reasons people give for switching their superannuation products to another fund is investment performance, as well as fees and associated charges. These monetary related reasons appear to be more common than reasons relating to brand or service.”

The report also highlights the fact that industry fund members are less involved than those with other superannuation funds in planning for their financial future, however most of them agree that they should do something about it. The key to retaining these members is not only performance but a detailed understanding on how to communicate and educate the different segments within the funds customer base.

Click here to learn more about “Superannuation and Wealth Management in Australia” report. The report ranks the top superannuation fund managers in Australia, potential financial planner bias, satisfaction, switching, intention to switch, reasons for switching, attitudes to retirement planning and financial confidence. The report looks at superannuation in the context of total Australian household wealth in detail.

For comments or more information please contact:

Norman Morris, Industry Communications Director
Telephone: +61 (3) 9224 5172
Mobile: +61 402 014 474
Norman. Morris@roymorgan.com

About Roy Morgan Consumer Single Source

Roy Morgan Single Source is based on over 50,000 interviews each year and has been designed and engineered to represent the ideal source model. It provides an integrated understanding of consumers; what they are like, what they consume, what they buy, what they think, what they want, what they watch, read and listen to. The overriding benefit of Roy Morgan Single Source is the strategic insights it offers in the ability to link many aspects. Not only can an organisation’s profitable customers be delineated by what they think, do, watch, but so can non customers. Hence brand positioning, product differentiation, merchandising, efficient media planning, market expansion and line extension opportunities can all be considered in the light of the correct understanding of the marketplace.

About Roy Morgan Research

Roy Morgan Research is the largest independent Australian research company, with offices in each state of Australia, as well as in New Zealand, the United States and the United Kingdom. A full service research organisation specialising in omnibus and syndicated data, Roy Morgan Research has over 70 years’ experience in collecting objective, independent information on consumers.

In Australia, Roy Morgan Research is considered to be the authoritative source of information on financial behaviour, readership, voting intentions and consumer confidence. Roy Morgan Research is a specialist in recontact customised surveys which provide invaluable and effective qualitative and quantitative information regarding customers and target markets.

Margin of Error

The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.

Sample Size

Percentage Estimate

40%-60%

25% or 75%

10% or 90%

5% or 95%

5,000

±1.4

±1.2

±0.8

±0.6

20,000

±0.7

±0.6

±0.4

±0.3

50,000

±0.4

±0.4

±0.3

±0.2