Only 35.4 per cent of Australians sought the advice of a professional, such as an accountant or financial planner, when deciding to change superannuation providers.
The Superannuation and Wealth Management in Australia report released by Roy Morgan Research found that 2014 saw most of those switching superannuation providers ask for some sort of advice. 18.7 per cent asked their employer, 12.2 per cent asked friends/family, and 9.3 per cent went to their financial institution directly.
The report, using the results from over 250,000 interviews over the last five years, revealed a rise in the number of those seeking advice when switching funds. The current level stands at 72.0 per cent, a 1.2 per cent rise from what was registered in 2010.
“While it is a positive trend that more people are seeking advice when switching their superannuation fund manager, there are still some issues regarding where people get advice — not to mention the 28 per cent who don’t get any advice,” Roy Morgan Research Industry Communications Director Norman Morris said.
“With only around a third of those who switch their superannuation getting professional advice, combined with the considerable lack of engagement and understanding by many in superannuation, it is of some concern that they may miss out on appropriate advice for their particular needs.”
The findings revealed a median amount in superannuation of $102,000 for those seeking professional advisors, while those not seeking advice were found to have a median of only $44,000.
Of those seeking advice, 82.9 per cent were most likely to be switching to self-managed super funds. Major retail funds (76.2 per cent) and industry funds (62.7 per cent) followed.
“This research shows that people with high superannuation balances are more likely to seek professional advice than those with less funds,” Mr Morris said.
“Besides cost, the potential reasons for this include a lack of trust in financial advisers, low financial literacy, and lack of availability of scaled advice.”