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