In this guide
This month we look at the US investment giant setting its sights on Australian super, the launch of AFCA’s comparative reporting tool, ASIC flagging potential downsides of SMSFs, the risk of cyberattack for Australian financial institutions and the SMSF couples that are tracking well against lifestyle goals.
Vanguard could shake up Australia’s super sector
US funds management giant Vanguard has its sights set on Australia’s superannuation industry.
The US investment company that pioneered low-cost, low-risk index investing in the 70s, Vanguard is now the world’s biggest provider of mutual/managed funds and second largest provider of exchange traded funds (ETFs).
According to a recent report in the Australian Financial Review, Vanguard is “drawing up plans” to enter the superannuation side of asset management in Australia.
The report quotes Vanguard Australia’s Head of Market Strategy and Communications Robin Bowerman as saying, “It is an important strategic direction we are taking but it’s about repositioning Vanguard to be closer to the end investor.”
Australia’s superannuation industry is estimated to be worth around $3 trillion since compulsory contributions became law in 1992, making it the fourth largest pension market in the world.
If Vanguard brings its low-cost ETFs and managed funds into Australia’s super sector, financial analysts say it’s likely to result in a pricing competition between industry funds, which have recently benefited from positive coverage of their returns in the financial Royal Commission.
Vanguard’s total assets under management are currently estimated to be $6.8 trillion, but what makes the company so special is that it runs on a not-for-profit basis, with earnings typically being reinvested back into lower fees for its customers so it can maintain its reputation as a low-cost, high-quality provider.
AFCA’s new online tool compares consumer complaints
A new online tool lets consumers compare financial institutions side by side to see how they are handling complaints.
Launched this month by Australian Financial Complaints Authority (AFCA), the comparative reporting tool Datacube shares information about the number of complaints AFCA receives, how long it takes each member firm to resolve its issues, and the number of times financial firms don’t respond to complaints.
