What is MySuper
3.1 What is MySuper
MySuper is a government initiative aimed at providing a simple, cost-effective product for Australians who are invested in the default option of their superannuation fund. From 1 July 2017, all member accounts in default investment options are required to be invested in a MySuper product. Superannuation funds must apply to APRA for authorisation to offer MySuper products.
MySuper products offer either one diversified, investment option, or a life cycle strategy in which allocation to growth assets decreases as the member ages. A MySuper product can be a stand-alone product or it can be offered as one of the choices contained in a regular super fund.
Features of MySuper products:
- they offer a single investment strategy
- they are low cost and easy to compare
- there are restrictions on the fees that can be charged
- they typically provide a basic level of life insurance and total & permanent disability (TPD) insurance on an opt-out basis
Since December 2019, APRA has published the MySuper product heatmap which aims to assist members to compare investment performance, fees, and sustainability of member outcomes.
From 1 July 2021, MySuper products will be subject to an annual performance test. Any MySuper products that fail the new APRA-administered annual test twice in a row will not be allowed to receive any new members until they improve their performance.
This technical resource is intended for the use of financial advisers only. It is current as at the date of publication but may be subject to change. This publication has been prepared without taking into account a potential investor's objectives, financial situation, needs or objectives. Before making a recommendation based on this material, you should consider its appropriateness based on the client's objectives, financial situation and needs. Rainmaker Group is not a registered tax agent under the Tax Agent Services Act 2009. Your client should refer to a registered tax agent before relying on information published herein that may impact their tax obligations, liabilities or entitlements.
Last modified: Thursday, May 6, 2021