Super satisfaction survey

Nearly a quarter of retail super fund members we surveyed are considering switching to another option.
Learn more

01 .Introduction


CHOICE’s survey of more than 1400 members reveals dramatic variations in customer satisfaction with the different types of super funds. Perhaps most striking is the degree to which members of “retail” funds – those typically owned by banks, fund managers and insurance companies – are less satisfied than others; see the results table for more.

In a nutshell

  • Customer satisfaction is highest with public sector (government) funds.
  • Corporate and industry funds rate next highest overall.
  • Retail funds lag on most of the criteria we measured, but particularly noticeable was dissatisfaction with fees, investment performance, customer service and, ironically, financial advice provided by the fund.
  • About one in 10 of all respondents are considering switching their super fund, with the potential for churn highest among retail fund members, at 23%.

Super choices

Public sector funds: Defined benefits are more often paid to members of public sector funds than other types. This means retirement income is based on a percentage of your final salary, years of service or some other formula, and not subject to the vagaries of investment market performance. And some public sector employers contribute more than the compulsory 9% minimum – 15% to 25% of salary is not uncommon. While most defined benefit funds are closed to new members, some public sector accumulation funds, such as the very low-cost First State Superannuation Scheme, have open membership and aren’t restricted to government employees.

Corporate and industry funds. Like public sector funds, both are considered not for-profits. As their name implies, corporate funds are arranged by companies for their employees, invariably using the same fund managers as retail funds, but often with more competitive fee structures. Industry funds are also known for their relatively low fees.

Self-managed super  (SMSFs) is the fastest-growing sector, and is now worth more than the corporate, industry, public sector or retail categories, with about one-third of total superannuation assets. For some, DIY super can be costly and time-consuming, but it’s rewarding for others. We found satisfaction with SMSFs is higher than for all public offer funds, and 20% of respondents expecting to switch from other types of funds plan to take the DIY route.

Retirement uncertainty

Almost half of all respondents feel they’re on track for a comfortable retirement – but 25% do not. Confidence about the future is greatly influenced by the type of super fund people contribute to; 57% of corporate fund members feel on track, which is not surprising given these funds often have low fees, good performance and on average, wealthier members. Almost half of all public sector fund members feel on track, but the number drops to 39% and 37% for members of industry and retail funds. Industry fund members tend to have below-average balances, while confidence in retail funds is lacking for the reasons already identified.


Sign up to our free

Receive FREE email updates of our latest tests, consumer news and CHOICE marketing promotions.

Superannuation results
Super funds compared Satisfaction scores
Fund (in order of overall satisfaction score; number of responde Overall satisfaction score (%) Investment performance score (%) Range of investment options score (%) Fees and charges score (%) Customer service score (%) Call centre score (%) Website score (%)
State super (34) 81.2 na na 78.7 82.5 na na
Commonwealth Superannuation Scheme (CSS) (48) 78.5 66.8 60.0 77.6 69.5 69.3 73.0
QSuper (50) 77.4 72.4 69.3 82.0 79.1 79.7 80.7
Telstra Superannuation Scheme (30) 75.7 na na na na na na
UniSuper (89) 74.2 73.2 70.8 75.1 68.3 65.3 76.1
Public Sector Superannuation Scheme (78) 74 72.1 59.3 77.8 73.8 74.1 73.0
Average public sector/government fund (424) 72.9 66.7 64.2 75.3 74.9 74.0 73.3
AustralianSuper (97) 69.3 61.8 69.8 70.9 66.1 62.6 70.8
Average industry fund (488) 68.7 64.1 66.2 69.6 68.8 68.6 72.7
Average corporate fund (109) 68.4 68.4 66.3 72.2 72.4 69.9 73.2
Health Employees Superannuation Trust Australia (HESTA) (49) 66.7 62.0 64.0 68.0 70.3 71.3 72.8
Average all funds (1402) 66.4 62.0 63.9 64.9 69.2 68.7 71.7
First State Superannuation Scheme (81) 64.1 58.7 60.0 65.5 71.3 70.4 69.1
Colonial First State (47) 59.6 56.7 61.2 51.8 63.7 na 71.9
BT (46) 56.5 50.9 59.8 46.7 61.8 na 65.0
Average retail fund (380) 55.6 53.2 60.1 47.1 62.8 61.6 67.7
AMP (60) 51.2 49.5 58.7 45.7 58.7 na 71.0

Superannuation results
Super funds compared Satisfaction scores General information
Fund (in order of overall satisfaction score; number of responde online account score (%) Insurance productsscore (%) Retirement products fees and charges score (%)na Financial advice provided score (%)na Fund typePublic sector / Govt Benefit structure Available to anyone
State Super (34) na na na na Public sector / Govt Hybrid No
Commonwealth Superannuation Scheme (CSS) (48) 70.0 na 73.9 na Public sector / Govt Hybrid No
QSuper (50) 82.0 na na na Public sector / Govt Hybrid No
Telstra Superannuation Scheme (30) na na na na Corporate Hybrid No
UniSuper (89) 77.6 69.0 74.7 na Industry Hybrid No
Public Sector Superannuation Scheme (78) 73.2 72.3 77 na Public sector / Govt Defined benefits (A) No
Average public sector/government fund (424) 74.3 69.1 72.9 69.6 Group na na
AustralianSuper (97) 73.5 68.0 55.3 na Industry Hybrid (B) Yes
Average industry fund (488) 75.3 65.3 60.1 71.4 Group na na
Average corporate fund (109) 74.9 69.7 61.8 69.2 Group na na
Health Employees Superannuation Trust Australia (HESTA) (49) 76.8 61.7 na na Industry Accumulation Yes
Average all funds (1402) 73.9 66.1 60.5 67 Group na na
First State Superannuation Scheme (81) 72.8 59.4 65 na Public sector / Govt Accumulation Yes
Colonial first state (47) 73.9 na 51.2 na Retail Accumulation Yes
BT (46) 72.9 na na na Retail Accumulation Yes
Average retail fund (380) 71.2 62.7 48.4 58.8 Retail na na
AMP (60) 72.3 na na na Retail Accumulation Yes


na Not available – there was an insufficient number of responses to report on. All scores are respondents’ rankings, including overall score, which is not calculated from other scores.

(A) The administrator also offers the Public Sector Superannuation Accumulation Plan. We didn’t receive enough responses to report on that fund individually.

(B) AustralianSuper’s main workplace division is an accumulation fund. The corporate division offers a hybrid (accumulation and defined benefits) fund.

Thanks to the 1402 CHOICE members who completed our online survey in June 2010. We only report the results for individual super funds and questions where at least 30 responses were collected, and recommend caution in interpreting findings derived from smaller samples. Responses for individual institutions are included in aggregated group figures, such as “average industry fund”.

About one in 10 of all respondents is considering switching their super fund, but the potential for churn is highest among retail fund members at 23%. This compares with just 7% of industry fund respondents, 4% of those in public sector funds and 9% of corporate fund members.

So what is influencing this dissatisfaction with big-name funds such as AMP, BT and Colonial First State? Retail funds lag on most of the criteria we measured, but particularly noticeable was dissatisfaction with fees, investment performance, customer service and, ironically, financial advice provided by the fund. One respondent expressed disappointment with his retail fund and adviser’s “guarded approach to advice for members, unless it follows from an extensive fee; their commission-earnings basis; uncertainty over whose interests they are primarily managing (their own business or their members’), and advice being ‘off the shelf’ rather than truly tailored for the member”.

Another said: “I think the retail super industry offers poor service, average returns and an excessive amount of fees deducted. I am very unhappy with my fund, and only a lack of time at present stops me from changing.”

Of course, satisfaction surveys gauge perceptions of performance and are influenced by customers’ expectations. Actual performance and fee levels, for example, may differ.

Retail funds rank worst

Retail fund respondents are 28 times more likely than those in industry funds to have been introduced to their super fund by a financial adviser. Half of retail fund members use advisers as their primary source of financial advice, with a fairly even split between those using corporately “aligned” and independent planners. This is a much higher reliance on advisers than respondents with industry (16%), public sector (28%) or corporate (31%) funds.

Many advisers are likely to recommend retail funds, as their higher fees are often paid as a sales or advice commission. Funds that do not pay adviser commissions, such as industry funds, are far less likely to be recommended by most advisers.

Another major factor influencing recommendations is ownership. Up to 85% of advice companies are owned by the financial institutions behind retail funds, and many advisers tend to steer people towards their parent company.

There are signs that retail funds are getting the message about customer dissatisfaction. In July 2010, AMP moved to a fee-for-service advice model ahead of an upcoming regulatory ban on commissions from mid-2012 (see Financial advice minefield). AMP also recently launched a simple low-cost super fund it claims is cheaper than industry funds.

Government safety net 

Some of the problems identified in relation to superannuation fees, performance and adequacy are addressed in the Super System ('Cooper') Review, a major government report released in July. It recommends the introduction of simple, low-cost default funds (“MySuper”) for people who don’t make a choice. According to Treasury estimates, this proposal, if implemented along with other efficiency improvements, would cut the average member’s fees by about 40%, lifting their final super balance by about 7% (or $40,000) after 37 years in the workforce.

Most rely on super

The pie chart below shows 68% of respondents consider superannuation their main savings vehicle for retirement. The remaining responses were fairly evenly divided between investment property, the family home and other non-superannuation savings and financial investments. “Property is the main vehicle to fund my retirement and other life goals,” said one CHOICE member. “My super fund will provide a buffer and life insurance services.”


Roy Morgan Research

In May 2010 Roy Morgan Research released its report Superannuation and Wealth Management in Australia, based on interviews with over 50,000 consumers per annum. The report analysed the proportion of investors that were very” or “fairly” satisfied with the financial performance of their work-based or personal superannuation, on a five point scale. The conclusions are broadly consistent with our survey: satisfaction was highest with self-managed super funds, followed by (in this order) public sector, industry and retail fund managers. AMP had the second lowest retail fund satisfaction score, just ahead of AXA.

There are steps you can take if you’re not satisfied with your super fund. The links below guide you to to information on how to:

Switching super

You may also want to switch funds: 

Check that choice of fund is open to you. Some people covered by industrial employment agreements, as well as members of defined benefit funds, cannot (and often should not) switch.

Work out the risks and costs of closing your existing fund or funds: This may include exit fees or the loss of life or income protection insurance (or a requirement for a medical check with your new fund). 

Calculate the costs (fees) and benefits with the new fund. 

If you decide to switch, complete a Standard Choice of Fund form, available from the Australian Taxation Office. Provide the completed form to your employer.

Complete transfer form(s) (also available from the ATO and your super fund), as money from other super accounts does not automatically get transferred into the new fund. The transfer process is somewhat arduous, requiring proof of identity documents certified by an individual approved to do so, such as a Justice of the Peace. A number of survey respondents complained about the difficulty of consolidating funds. 

Consider getting licensed financial advice While many advisers have been rightly criticised in the past, good advice can be an invaluable investment. “My financial planner thoroughly investigated my circumstances and goals, and then made recommendations to set me up for a retirement with dignity,” said one CHOICE member. “His recommendations covered all aspects of my financial situation and were like a life plan. We meet regularly where any changes in my circumstances are uncovered and my plan is reviewed. I couldn’t have done this without him.”

When CHOICE member and survey respondent Andrew Maloney contacted AMP to open a super fund 16 years ago, he was told he needed to go through an adviser. During those subsequent 16 years, despite four of his eight chosen investment funds losing about half their value during that time, Andrew’s allocated adviser never once contacted him, yet continued to collect commissions and fees.

“I’ve slowly learnt that Australia’s biggest super provider doesn’t do much,” Andrew says. “Neither does the agent they force you to use. In the end, everyone is by default selfmanaging their super, so you may as well set up a self-managed fund. Compared with AMP, if my self-managed investment strategy was to bury my super in the backyard, I’d still be better off.”

Based on Andrew’s original instructions, each year AMP “rebalanced” his investments, transferring money from the performing funds to the losing ones. “It may have been hard to predict performance, but after watching four funds lose money year after year, why didn’t AMP stop using these managers and recommend its customers take money out of them? I don’t understand what the financial adviser is getting paid for.”

Andrew contacted AMP in June to confirm the total contributions he’d made and their long-term investment performance, but was told records only went back seven years, of which just five could be disclosed to customers. AMP couldn’t even tell him his total contributions. When Andrew questioned his fees, which are 3.5% of the value of each contribution and management fees of about 2% per annum of his fund’s total value, he was told he could negotiate them with his adviser – until the customer service representative told him he no longer had one.

“The lesson is, you need to manage your own super,” says Andrew. “Start by doing it properly and open a self-managed fund. I’ll put the money into an index fund, or start digging holes in the backyard.”

AMP told CHOICE it cannot “un-choose” the auto-rebalancing option without the client’s instruction. It clarified that Andrew was provided with incorrect information, and has an adviser working at Horizons Financial Planning, which is part of AMP. “It’s unfortunate that the adviser was not in contact with Andrew,” an AMP spokesperson said. “We can understand his frustration, and we would like to contact Andrew to help him out if he agrees.”

AMP no longer pays commissions to advisers for new super products arranged; however, this does not apply to clients' existing products.

Your say - Choice voice

Make a Comment

Members – Sign in on the top right to contribute to comments