After more than a decade boosting consumer awareness about what to look for when choosing a super fund, the “Compare the Pair” campaign has been updated.
The “Compare the Pair” model – commissioned by Industry Super Australia and prepared by ratings, research and consultancy company SuperRatings – has been expanded to include three, ten and fifteen year outcomes, allowing consumers to make comparisons over the short, medium and long term – not just one time period.
SuperRatings compare the average main balanced investment option performance of the average Industry SuperFund against that of the average retail fund. The comparison is made on a net-benefit basis, that is after fees and costs have been deducted from any investment returns.
The changes mean that consumers are now able to see super fund performance over additional time periods – including that of some bank-owned retail funds with only a limited performance history.
The updated model shows that, on average, a person who switched to the average Industry SuperFund three, ten or fifteen years ago would have been better off.
For example, a sales representative on an average salary with $74,600 in super who switched from a retail fund to the average Industry SuperFund would have been:
· Over $5,000 better off if they switched 3 years ago;
· Over $20,000 better off if they switched 10 years ago; and
· Over $54,000 better off if they switched 15 years ago. (*see table over)
Industry Super chief executive, David Whiteley, says that while super is a long-term investment, consumers should be able to easily compare funds over short and medium terms to test whether their savings are on track or could be working harder.
“We know that many people don’t spend much time thinking about their super. The Compare the Pair campaign helps people do the maths simply and quickly,” Whiteley said.
Whiteley said the updated model reinforced how big an impact choosing the right super fund could have on a person’s retirement.
“By putting members’ interests first, Industry SuperFunds deliver more each year. And with compounding interest that can make a huge difference to a member’s income during retirement”.
The famous “Compare the Pair” advertisements – which first aired in early 2005 – have been revised to reflect the updated model and will appear nationally from 20 March 2018.
Watch the Industry SuperFund “Compare the Pair” advertisements Moving Trucks and Shopping Centre
Balance after fees over the last 15 years
HR Mgr $90,000
The difference: $3,965
The difference: $18,458
The difference: $49,406
Sales Rep $59,100
The difference: $5,268
The difference: $20,871
The difference: $54,821
Source: Modelled outcome shows average difference in the net benefit of 16 Industry Superfunds and the retail super funds tracked by SuperRatings with a three (147 funds), ten (77 funds) & fifteen (45 funds) year performance history to 30 June 2017, taking into account historical earnings and fees of main balanced options. For details visit https://www.industrysuper.com/footer/assumptions/