Superannuation fund cuts fees

An ethical superannuation disruptor is the latest to adjust its fees before the Protecting Your Superannuation legislation hits.

Future Super is cutting fees for low balance members.

From July 1, the $400 million fund will remove the set dollar administration fee it normally charges for members with balances lower than $6000. Future Super members with balances below $1000 are already not charged the set dollar admin fee.

The move will see more low balance members save over $95 a year, and founder Adam Verwey believes it demonstrates the difference between Future Super and the wider super sector.

"The PYS reforms are meant to be sending a strong signal to the superannuation industry that they need to do more to protect the savings of younger and lower balance members," Verwey told Financial Standard.

"Yet, Future Super seems to be one of the very few super funds who are responding by further reducing fees and costs. In fact, most big industry funds seem to be increasing their fees in response to the reforms."

Rainmaker analysis of APRA data shows more than 60% of Future Super's members had an account balance lower than $25,000 in 2018, while over a quarter had an account balance below $1000.

For Verwey, the move highlights Future Super's wider ethical remit, which isn't limited to the investments it holds.

"Future Super aims to be an ethical fund, not just in how we invest the savings of our members but also in how we operate," he says.

"While the super industry has previously lobbied against member protection rules, Future Super has always worked to protect the savings of its younger and lower balance members."

Read more: Future SuperSuperannuationAdam VerweyFinancial Standard
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