Retired clients: 5 ways to keep them

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The main reason for setting up an SMSF is to have more control over investments, but retirees have indicated that over time, their SMSF will become a burden, and some are likely to move their super to an industry fund. This may not be the only move, and in order to keep your clients happy, CoreData conducted research into what is most important to post-retirees.

While retirees still want direct investment options, this is not a deciding factor on whether they will stay or go. Only 13.7% of respondents said a super fund should offer direct shares if they want to keep their business. A further 18.8% said their super fund should offer a term deposit; but the most popular option was lower fees at 77.8%. Respondents also chose good customer service as important (63.9%) and competitive returns (62.1%).

CoreData’s head of advice, Wealth & Super, Salvador Saiz said it was a multi-choice question and respondents could have chosen all options if they wanted to. “While they want those [direct investment] options, it’s not on the priority list in terms of what’s going to keep them in the fund,” he said.

More than three quarters of respondents want investments that focus on sustainable income, capital preservation and low volatility. Saiz said that some members “simply aren’t aware of their super funds’ services; not just in regards to advice services, but also with regards to investment options available etc.”

“Super funds are doing a good job in focusing on member engagement, but they have some way to go yet for example in segmenting and targeting members with relevant communications and messaging.”

Other findings:

  • Two in five (38%) of pre-retirees were not sure which super funds provided the best overall solutions
  • Almost 30% of post-retirees were also unsure
  • SMSFs proved the most popular option with post-retirees – 27.1% chose them as the best retirement solution
  • Industry funds were at 19%, and public sector funds at 19.3%