Industry fund reveals paying up to $500,000 a year fee to outsource advice

industry super ISA superannuation mtaa super

18 May 2020
| By Mike |
image
image
expand image

Yet another major industry superannuation fund has revealed that the per member cost of providing financial advice is around $2 to $2.50 per member.

The latest fund to disclose this cost is MTAA Super which acknowledged that it did not directly employ financial advisers.

Answering questions on notice from the House of Representatives Standing Committee on Economics, the big fund said that it did not employ financial planners.

“Financial planning is outsourced. The cost of providing this service to members is approximately $400,000 to $500,000 per annum which is approximately $2-$2.50 per member per annum,” it said.

“MTAA Super outsources comprehensive advice activity to Industry Fund Services (IFS), with members able to access advice from qualified planners who are dedicated to MTAA Super members.

“Members pay IFS directly for advice received, with those payments offset against the outsourced service fee,” it said. “To have this service available to members, MTAA Super pays between $400,000 and $500,000 each year.”

The MTAA Super answer said that members were not charged specifically for intrafund/scaled advice and that these costs formed part of the Fund’s operating expenses which were funded from the administration fee to members.

It said that General Advice formed a part of a broad administration activity, including call centre and field staff.

“In addition, publications (product disclosure statements, factsheets), online calculators and workshops/seminars form a part of the general advice offer. As such we are unable to identify the specific costs overall or per member for this activity.”

 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

This verdict highlights something deeply wrong and rotten at the heart of the FSCP. We are witnessing a heavy-handed, op...

6 hours 59 minutes ago

Interesting. Would be good to know the details of the StrategyOne deal....

4 days 12 hours ago

It’s astonishing to see the FAAA now pushing for more advisers by courting "career changers" and international recruits,...

3 weeks 2 days ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

2 weeks 4 days ago

A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments ...

3 days 10 hours ago

Pinnacle Investment Management has announced it will acquire strategic interests in two international fund managers for $142 million....

2 days 13 hours ago