Corporate Super – How do you make it work for employees?

By David Baruffi, Director & Financial Advisor

Corporate Superannuation is often seen by servicing advisors as a relatively passive exercise. However we have found that many employees report being disengaged from their Corporate Superannuation plan and do not understand the various benefits on offer as part of their Corporate Superannuation arrangement.  Engaging employees in a wealth building discussion has proven to be effective at increasing employees’ sense of control around their superannuation and satisfaction with their benefits.

Our engagement with employees who are part of a Corporate Superannuation plan includes education on the wealth building and investment fundamentals plus education on the benefits of a Wealth Protection strategy, things that are often overlooked by employees as part of the employer’s benefits program.

Our experience has shown that when it comes to Corporate Superannuation:

  • Employees have very little understanding about super, how it works and what it can do for them.
  • New and existing employees miss out on the advantages of a Corporate Superannuation fund as they are not told of the benefits of the corporate plan or do not fully understand the unique benefits it provides, including automatic acceptance.
  • Members aged 55 and above are missing out on the advantages of Transitions to Retirement (TTR) as they do not know how it works and how the significant tax breaks can benefit them.
  • Members aged 45 and above are not taking their super seriously enough to ensure they are providing adequately for their retirement, often delaying retirement which may be costly for the employer in the long run.
  • Members are not consolidating their various super policies because it is deemed to be too complex.

We have found that the best way to overcome these problems is by:

  • Contacting every new staff member and explaining to them the advantages of joining the Corporate Superannuation fund.
  • Call every person that leaves and explain what happens to their super when they leave, retaining good will for the company.
  • Call everyone turning or over age 55 and arrange to meet with them to go through the TTR calculations to see if they can take advantage of the tax breaks that are available to them.
  • Contact everyone age 40 and over to go through the importance of super and how they can maximise their retirement savings.
  • Have the Corporate Superannuation provider assist employees to consolidate their super.
  • Run seminars on the Corporate Superannuation plan to inform people of the benefits of the plan and the steps they can implement to take control of their Retirement Planning.
  • Provide employees with Investment Advice aimed at having them take an active interest in the performance of their superannuation account.

By doing these things we have found that we have been able to greatly increase the number of people maximising the benefits of their Corporate Superannuation plan, improve overall satisfaction and vastly improve recognition of company provided benefits.

David Baruffi is a director of Blueprint Wealth and has over fifteen years’ experience as a financial adviser.

Blueprint Planning Pty Ltd (ABN 78 097 264 554) trading as Blueprint Wealth and David Baruffi are Authorised Representatives of AMP Financial Planning Pty Limited

Disclaimer: This article contains general information only. It does not take into account your objectives, financial situation or needs. Please consider the appropriateness of the information in light of your personal circumstances.