Negotiating with the big boys

Hi Scott,

Can you help me negotiate for a better deal with my superannuation provider? I've already asked them to reduce my fees twice, but they seem reluctant. Surely the whole industry cannot be sewn up like this? It seems incredible that they won't work a little harder to keep my business. Please help.

Brendan

Hi Brendan,

I like the way you think.

A US-study by Morningstar found that the best predictor of success didn’t come from a funds past returns, or their investment style, or even Morningstar’s own ‘star ratings’: it all came down to fees.

Over the long-term, the funds with the lowest fees earned the best returns.

However, there’s a better chance of the Reserve Bank Governor rapping his next interest rate announcement “yo, we’re keep’n the cash rate at 2 point ohhh!”, than you do getting your super fund to change their asset based fee. That’s just not how their system are set up.

You have two choices: if you have $500,000, you can open an SMSF, and invest directly in shares, Listed Investment Companies and Exchange Traded Funds (ETF). Or, you can hunt around and find an ultra low cost industry fund.

Scott