Where there’s political will, there’s a way

Nic Szuster

The party that emerges the victor at the Federal Election will need to change the rules to allow people to use their accumulated superannuation savings to pay for financial advice that extends beyond superannuation.

That was a key finding from a round-table conducted by MoneyManagement’s sister publication Super Review during last week’s Association of SuperannuationFunds of Australia national conference on the Gold Coast.

The round-table finding came as industry research conducted by ANOP surprised many superannuation fund executives by revealing that financial planners were becoming an increasingly important part of the superannuation industry, being used by as many as 26 per cent of fund members.

The ANOP data said financial planners were “making significant inroads in the super industry”, with more than one in four Australians reporting they currently consult a financial planner about their super.

At the same time, senior superannuation fund chief executive Nick Szuster of the South Australian and Northern Territory public sector fund Local Super said there was a need to find a way for people in their 30s and 40s carrying heavy mortgages to access much-needed financial advice.

“Where we really do need to have financial planning services provided is for 30-year-olds with large mortgages, no money but [wanting] to have a million dollars when they’re 50,” he said.

“Now they need a plan.

“But where are they going to get that plan? Because if they go to a financial planner he is going to ask, ‘How are you going to pay for my services?’,” Szuster said.

“So there has got to be some way they can use their accumulated superannuation benefits to assist them beyond superannuation, to address their mortgage problem and to have a plan for the future,” he said.

“What we need is the political will to get the Government to change the policy to give them that access,” Szuster said.

Russell’s Stephen Roberts said he agreed with Szuster’s basic contention, but argued that if the money to pay for the advice simply came out of accumulated savings, there would be a tendency to see it as “free advice”.

He said that if the client had to write a cheque they would recognise the value of the advice.

The head of BNY Mellon in Australia, James Gruver, said he believed being able to access superannuation savings to obtain advice was important, but that people would need to be given options as to how they ultimately paid for the advice.