Public offer funds
Advantages:
- Uses an approved trustee.
- Diverse range of investment options which are professionally managed.
- Some Master Funds have access to direct shares within a portfolio.
- Many Public offer funds offer life insurance cover as apart of the many services they provide to members.
Disadvantages
- Members have limited opportunity to select specific investments they would like to include in their portfolio.
- Investors have no control over the timing of investment decisions made by the underlying fund managers that, in turn, may have an impact on the taxation of the fund.
- Public offer funds can be expensive, and generally can charge an entry fee between 0% and 5%, and an ongoing management fee that can range from 0.0% to 3% per annum.
- Upon time of payment of a benefit, a public offer fund may only offer limited choices in terms of the manner in which a benefit is paid.
Employer Sponsored Superannuation Funds
Advantages:
- Uses an approved trustee.
- Diverse range of investment options which are professionally managed.
- Some Master Funds have access to direct shares within a portfolio.
- Many Public offer funds offer life insurance cover as apart of the many services they provide to members.
- Some Plans have Automatic Acceptance of Life Cover without the need to be underwritten.
- Some Plans may offer fee discounts.
Disadvantages
- Members have limited opportunity to select specific investments they would like to include in their portfolio.
- Investors have no control over the timing of investment decisions made by the underlying fund managers that, in turn, may have an impact on the taxation of the fund.
- Public offer funds can be expensive, and generally can charge an entry fee between 0% and 5%, and an ongoing management fee that can range from 0.0% to 3% p.a.
- Upon time of payment of a benefit, a public offer fund may only offer limited choices in terms of the manner in which a benefit is paid.
- You will only remain a member of the employer plan whist employed by that company. Upon cessation of employment, your plan will automatically roll over into a personal plan.
Industry funds
Advantages:
- Publish low administration fees.
- Run only to profit members.
- Simple to use.
Disadvantages:
- Potentially lower level of service.
- Generally no financial adviser attached to Industry Funds, when compared to Public.
- Public Offer and Employer Sponsored Plans.
- Generally a smaller range of investment options available.
- Can have hidden fees.
- May not be able to purchase direct shares.
Retirement Savings Account (RSA)
Advantages:
- Capital Guaranteed products generally offered by banks.
- Fully Portable, owned and controlled by the member.
- Simple, low cost, low risk products.
Disadvantages:
- Does not offer member investment choice.
- May conflict with your investment objective of maintaining the real value of your portfolio and combating the effects of inflation over the medium to long term.
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