Greeting Fellow Super Enthusiasts!

This week we have a guest blog from the multi-talented Melissa Birks, Superpartners’ Customer Experience Implementation Manager. Melissa has been in the industry almost as long as I have … well, not quite considering she is much younger….but she is certainly as knowledgeable in all things Super. I’m sure you will enjoy her wise ranting this week while I put my feet up.

Yours in Super

Hans

You vs James Packer

Picture this – you buy a new home and need to take out a mortgage of $400,000.  On the same day James Packer buys another waterfront mansion in Sydney for $4.5 million dollars.

Both of you head off to the bank to negotiate your mortgage rate (well, to be honest the bank would probably come to James).  Who do you reckon will get the better rate on their mortgage, you or James?

Or imagine you’re buying a new car and it’s you vs. James again, you’re getting a nice, reliable Toyota Corolla and he’s buying a top of the range BMW.  Will you or James get a bigger percentage discount?

I think we can agree that unless you’re a master negotiator James is going to get a bigger discount and lower rate than you because the banks and car dealers see the potential for lots more big deals in the future.

The same outcome occurs when you’re investing your money.  You’ll get a better rate of return with lower fees when you’re negotiating to invest $10 million than $10,000.

The bottom line is that for most Australians the ‘mates rates’ deal is out of reach…or is it?

One of the main reasons Industry Super Funds were formed was to allow Australian workers, earning a working wage, to have access to the same deals that the richest and most powerful Australian does.   The average balance for a member in an Industry Super Fund is $20,000 – not much negotiating power there.   But, when it’s combined with thousands of other accounts in a collective investment; the playing field changes.  The top four funds that Superpartners administers have a collective $76 billion to invest.  Compare this to James Packer’s net worth of $5 billion and you can see the Industry Super Funds are in a very strong position to negotiate the best deals for their members.

This means that working Australians get access to the lowest fees, the best rates and the most favourable terms for their second biggest financial asset; their super.  A better deal means a better outcome for their retirement and that’s got to be a good thing for everyone.

Your thoughts?

Melissa Birks