The SMSF Association (SMSFA) has declared its support for the government’s proposal to extend choice of superannuation fund, arguing it will give employees the opportunity to be more engaged with their super.
SMSF Adviser first reported on the draft legislation of the proposal in December last year.
SMSFA chief executive Andrea Slattery said superannuation guarantee contributions are foregone income by employees and as such, each individual member should have the right to choose which fund should save and invest on their behalf.
“Giving people the right to choose where their superannuation contributions are made will give them the opportunity to become more engaged and informed about their retirement savings,” she said.
“It will allow them to select a superannuation fund that they believe best suits their circumstances and retirement savings goals.”
The association firmly believes choice of fund will improve the system’s efficiency because of the likely drop in the number of superannuation accounts people will hold, Ms Slattery said.
“At present, it is believed that most individuals have at least three accounts,” she said.
“This will help reduce the amount of fees and insurance premiums deducted from an individual’s superannuation, boosting their retirement income over the long term.”
Allowing all employees choice will reduce the need for people to transfer funds from their default fund account to their account of choice – such as an SMSF, retail fund or another industry fund – minimising costs and complexity, according to Ms Slattery.
“Choice of fund will also ensure that all funds are on a level playing field in acquiring and retaining members, ensuring healthy competition in the marketplace that will drive better outcomes for members,” she said.
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
27 Feb 2017Newer SMSF investment products facing APL constraintsBy Miranda Brownlee
27 Feb 2017Government slammed over actuarial certificate plansBy Miranda Brownlee
27 Feb 2017High-level departures at AMP’s SMSF licensing armBy Aleks Vickovich
24 Feb 2017Government urged to rectify ‘legislative shortcoming’ with CGT reliefBy Miranda Brownlee
24 Feb 2017Actuaries Institute highlights further legacy pension issuesBy Miranda Brownlee
24 Feb 2017Fintech company launches online client management toolBy Staff Reporter
- view all
Newer SMSF investment products facing APL constraints
Newer investment products entering the market may provide SMSF practitioners associated with smaller independent dealer groups an opportunit...read more
Government slammed over actuarial certificate plans
Several industry bodies have raised concerns regarding the government’s proposals to implement an exemption to obtain an actuary certifica...read more
Government urged to rectify ‘legislative shortcoming’ with CGT relief
The Tax Institute has called for an extension of the deadline for applying the CGT relief in respect to the segregated approach, amid conce...read more
- view all