How to choose a pension fund

If you’re in the market for a super pension it’s tempting to stick with what you know and open an account with your existing super fund, but you could be short-changing yourself.

After 30 years of focusing on the needs of members accumulating savings, super funds are finally shifting gears to give the retirement phase the attention it deserves.

The retirement income covenant has compelled the industry to look at how members can be assisted to balance their retirement income needs. Funds are also recognising that the proportion of people retiring with sufficient savings to provide meaningful lifetime income is increasing.

Both these factors require funds to respond with the right products and services to meet their members’ needs after they become eligible to access super. Product development is still in its infancy but there are already some interesting offerings.

Of course, low fees and good investment returns are as important for a pension account as they were when you were accumulating super savings, but there is a lot more to selecting the right retirement product.

The following tips are designed to help you make a choice that could set you on the right track for life.

The investment menu

Consider what you want and need from the investments in your pension. Are you a highly engaged and educated investor who wants the option to invest directly in listed shares and exchange traded funds (ETFs)? Or are you happy to leave selecting individual investments to the experts and looking to choose a fund that will offer a suite of premixed options? Wherever you sit on the spectrum, there should be a pension product offering what you’re looking for.

If you’re considering a bucket strategy to draw income from more stable assets while the remainder of your pension is invested more aggressively, there are even products available that can manage it for you, so you’re not required to continue making active investment decisions throughout your retirement. Our research uncovered EquipSuper and VisionSuper as funds offering this service.