MySuper: A New Landscape for Default Superannuation Funds

Chant, Warren; Mohankumar, Mano; Warren, Geoff

doi:10.2139/ssrn.2442663

Cited by 16 publications

(23 citation statements)

References 3 publications

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“…In an examination of the strategic asset allocation of MySuper products, the survey of Chant et al. (:8) shows that most MySuper providers allocate over 70 per cent of their portfolios to growth assets, which is consistent with Weaver's () study (as mentioned previously). Within the growth assets, equity investments are weighted approximately fifty‐two per cent (consisting of 27 per cent domestic shares and 25 per cent international shares) of the total asset allocations.…”

Section: The Mysuper Initiativesupporting

confidence: 68%

“…A survey conducted by Chant et al. (:7) reports that as of March 2014, there were 120 superannuation fund entities registered for MySuper products and two thirds of these were in the industry and corporate sectors. Despite the fact that most retail providers have become trustees for the majority of corporate funds in terms of investment management, only a few of the larger retail providers have been permitted to offer multiple MySuper products.…”

Section: The Mysuper Initiativementioning

confidence: 99%

“…Global growth properties (both listed and unlisted), international inflation‐linked bonds, currency hedging, and other alternative securities are also included in MySuper investment strategies (Chant et al. ).…”

Section: The Mysuper Initiativementioning

confidence: 99%

“…A lifecycle approach aims to reduce sequencing risks, particularly concerning the possibility that members may suffer a great loss in their savings when it matters most (that is, near retirement) (Chant et al. ). An underpinning assumption is that members become more risk‐averse with respect to their investment performance as retirement approaches.…”

Section: The Mysuper Initiativementioning

confidence: 99%

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Retirement policy: a review of the role, characteristics, and contribution of the Australian superannuation system

2015

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With a market capitalisation of over $1.84 trillion dollars and large annual flows, the Superannuation Guarantee has been regarded as the backbone of Australia's retirement policy scheme and a primary driver of economic growth. However, losses encountered in the aftermath of the global financial crisis led to a major review of superannuation, mainly in response to the lack of accountability, comparability, and transparency discovered within ‘default’ investment options. An outcome of this review was the MySuper initiative, which imposes obligations on fund providers to reconfigure their default investment strategies in accordance with new regulatory requirements. Despite these policy reforms, other challenges remain, such as gender inequality, excessive superannuation fees, low financial literacy, and lack of member participation in growing retirement savings. The paper provides a review of literature pertaining to the background, significant policy changes, and ongoing development of the Australian superannuation system. We emphasise the role of superannuation in the economy; characteristics of the industry, plans, and funds on offer; recent policy initiatives; and perceived inadequacies of the system. The paper concludes with possibilities for further empirical research.

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Section: The Mysuper Initiativesupporting

confidence: 68%

Section: The Mysuper Initiativementioning

confidence: 99%

Section: The Mysuper Initiativementioning

confidence: 99%

Section: The Mysuper Initiativementioning

confidence: 99%

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Retirement policy: a review of the role, characteristics, and contribution of the Australian superannuation system

2015

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“…at the 90th percentile. The persistence of this variation even after MySuper reforms led some to conclude that ‘[h]opes that MySuper might lead to a range of simple, low cost, easy‐to‐compare default products have not been realized…’ (p.21) (Chant et al ., ).…”

Section: The Superannuation Industrymentioning

confidence: 97%

Superannuation in Australia: A Survey of the Literature

Kingston

Thorp

2018

Economic Record

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In 2017 Australian superannuation assets stood at 148 per cent of GDP, or $2.5 trillion in absolute terms. This was the world's fourth largest pool of retirement savings, a remarkable outcome over 25 years of the operation of the Superannuation Guarantee. We survey the local academic, industry and policy literature on the economics of superannuation during the last quarter of a century. Topics include the policy debate, the positive, normative and behavioural economics of household interaction with superannuation, and the structure, conduct and performance of the superannuation industry. We encourage further research into effective tax rates, the need to hedge human capital and the automation of financial advice.

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