QSuper is leveraging its scale as one of the country's largest superannuation funds to offer accumulation members a bonus should they keep post-retirement savings at the $60 billion industry fund.
As thousands of its members near retirement, Queensland's largest super fund has offered what could be viewed as both a fee holiday and a play to slow accumulation savings shifting out to banks, self-managed super funds (SMSFs) or being paid out as a lump sum.
Reported as an industry first, the bonus comes into effect on 6 June, and QSuper chief executive Michael Pennisi said it was further evidence of the fund's focus on individual members and supporting them throughout a lifetime of financial decisions.
QSuper said the transfer bonus is made possible due to the fund's asset structure. In 2014, custodian State Street segregated $44 billion of QSuper assets into income and accumulation, allowing a more equitable allocation of tax. By splitting the assets, QSuper can take advantage of tax concessions that apply to an Allocated Pension Plan.
Pennisi said the innovation was made possible by returning funds which had been set aside for future tax payable, to members as they enter the income phase of their retirement.
"We're always looking for ways to improve our members' retirement outcomes and by applying some smart thinking, we're able to achieve something that no other industry or retail fund has done," Pennisi said.
"While the transfer bonus amount will vary, depending on a few things like a member's super balance, investment options, the fund's tax position and the time of the transfer, every dollar helps."
"Eligible members won't need to apply for the Transfer Bonus, we'll work out the amount automatically and the bonus will be included in the money we move across to their income account."
Pennisi said with the number of Australians aged 65 and over expected to double by 2055, helping members through their post-retirement phase was a key priority of the fund.
QSuper data scientist Helen Johnson told the ASFA conference in November that about 30% of the fund's members, over a one year period, are converting into a pension account. At the time QSuper had about 36,000 pension members and Johnson said every year the fund gets about 6000 new pension members. Of the 6000 members that started a pension account last financial year, about 50% chose either the legislated minimum or a nominated amount to withdraw.