Although most media coverage following release of the Final Report from the Hayne Royal Commission has been about its impact on Australia’s banking system, the fallout for the super and financial advice industries is likely to be every bit as significant.
The three-volume final report from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (FSRC), is likely to result in major change for the super industry – both for super fund members and for trustees and executives managing the large super funds holding most Australian employees’ retirement savings.
Financial advisers are also likely to find their world upended yet again, with the FSRC report containing some significant recommendations in relation to their independence, advice fees and disciplinary system.
To help you understand the implications of the FSRC final report on your super fund and financial advice provider, SuperGuide has prepared an overview of the key points in each area.
FSRC final report: 5 areas that could change your super and financial advice
1. Super fund member accounts
A major change recommended in the FSRC report is that employees should only have one default super account and they should not be defaulted into a new super fund every time they change jobs. To assist with this, the report recommends a new mechanism be developed to ‘staple’ people to a single default super account.
If you have your super savings in a MySuper account, the payment of any fees for financial advice from your account balance will be banned. However, fees for simple intra-fund advice on things like consolidating multiple super accounts, selecting a super fund, or changing your investment option will be permitted.
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Janine has over 25 years’ experience writing about superannuation, including a decade as Managing Editor of the ASFA’s highly respected industry magazine, SuperFunds. She has worked with a range of super funds and leading institutional investment managers.
Her work has appeared in the Australian Financial Review personal finance section and she has been a regular contributor to Money Management and Financial Planning magazines.
IMPORTANT: All information on SuperGuide is general in nature only and does not take into account your personal objectives, financial situation or needs. You should consider whether any information on SuperGuide is appropriate to you before acting on it. If SuperGuide refers to a financial product you should obtain the relevant product disclosure statement (PDS) or seek personal financial advice before making any investment decisions. Comments provided by readers that may include information relating to tax, superannuation or other rules cannot be relied upon as advice. SuperGuide does not verify the information provided within comments from readers. Learn more
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