Why GESB Super Members are leaving after March 30, 2012

Posted on:  16 Mar 2012    Posted in:  News, Superannuation

GESB Super members are queuing up to leave the fund after 30 March, 2012. Are you one of them?

From 30 March, 2012, GESB’s 320,000 members will have choice of super fund – a right that other Australians have had since 2005. Howard Rosario, Chief Executive of the fund, has been quoted as saying he isn’t concerned about members leaving the fund, once they get the choice. See:

http://www.afr.com/p/business/financial_services/no_fear_of_big_super_switch_in_wa_HRPaEK3jFmx8zhP4cJWpBK

However over many years at JustInvest we have had many clients of GESB want to leave, who are now looking forward to 30 March. Why? The reasons depend on the individual, but some of them are as follows:

Lower Fees. Some Super funds don’t charge administration fees on Term Deposits or Cash investments. Compare the Pair – some funds are offering 5.75% interest for 6 month Term Deposit, with interest at maturity, with no administration fees (rates current as at 16.03.12). Match this to the fees you’re currently paying with GESB.

 See: http://www.gesb.com.au/index_investmentreturns.html

Greater choice of investments. GESB has about 11 investment options. Many other Super funds have 200-400 options. But do you really need these extra options? It depends if you’re interested in the following areas:

  • Term Deposits and Guaranteed Income funds
  • A wide range of Responsible and Ethical Investments
  • Specialist Fund Managers in areas such as Resources, Asian markets, Bonds, Index funds, and many more
  • Transparency of Investments

 See: http://www.gesb.com.au/index_2280.html

Shares. GESB doesn’t offer direct share investment. Many other Super funds offer shares – generally ASX 300 listed stocks

Estate Planning. Unlike other funds, GESB doesn’t accept beneficiary nominations. All proceeds are paid to your Estate. This is different to most other Super funds, who allow Binding Death Benefit Nominations – which, as the name suggests, make it binding on the Super Trustee to pay to your nominated beneficiary, bypassing your Estate. This is an important Estate Planning tool.

It is essential to seek professional advice before making any changes to your Super fund (particularly if you are a member of West State or Gold State, which operate under different structures – do not consider closing these funds until you have sought professional advice).

Please contact JustInvest for a no obligation discussion – ph: 08 9322 1110