Leading market research firm, Roy Morgan, has released its Superannuation Satisfaction report that indicates a decline in overall satisfaction with the super fund in February 2023. The results are based on findings from in-depth interviews with over 60,000 Australians. Satisfaction with super funds was found to have dipped by 5.4% from January 2022 figures of 72.0% to 66%. This is the lowest result since December 2020 when satisfaction was found to be at 64.8%. It is however still much higher than the long-term average from 2007 to 2023 of 57.9%.
The decline in satisfaction has been linked to the five interest rate increases recorded from September 2022 to February 2023 period. Volatility in the ASX 200 was also considered a contributing factor. The index has dropped by over 330 points by February 2023, from a high of 7,592.8 points in April 2022.
Concerns over some funds merging or announcing the intention to merge are also believed to have stirred dissatisfaction. Michele Levine, CEO of Roy Morgan, said that when it came to mergers, communication and a smooth transition process for members throughout were important. She added that as more mergers and acquisitions were likely to take place in the coming years, there was an increased need to ensure a high level of customer satisfaction and deliver better investment returns.
While industry and retail fund satisfaction ratings were low, Levine noted that SMSFs were a top choice. Industry funds dropped in satisfaction ratings by 6.3% from January 2022 figures to 67.9% in February 2023, while retail funds dipped by 5.6% to 61.3%. Industry funds declined by the largest margin of all the super fund categories. SMSFs declined by 5.3% to 74.7%, while public sector funds fell by 5.7% to 73.4%.
Of the industry funds researched, the report found that Unisuper and HESTA had the highest satisfaction ratings. Amongst retail super funds, Macquarie, MLC, and OnePath were the highest ranked. Macquarie stands out for being the only retail fund to buck the trend by raising its satisfaction ratings by 3.5% since January 2022.
Levine noted that with inflation at a 32-year high and the RBA having repeatedly increased the official interest rates to 3.6%, the market was likely to remain challenging. She also highlighted the emerging instability in the US and Europe financial sectors in recent weeks, as characterized by the collapse of the Silicon Valley Bank and the bailout of Credit Suisse.
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