Most wholesale, retail, employer and industry super funds charge one or a combination of the following fees:
- Management expense ratio (MER) – Charged as a percentage of your total funds.
- Annual Administration Fee – Charged as a fixed fee or as a percentage of your total funds.
- Annual Member Fee – Usual charged as a fixed fee for being a member of the fund.
- Entry or Contribution fee – Charged on rollovers and some or all contributions into the fund. The fee is usually set as a percentage.
- Exit fee – Charged when a member wants to exit the fund and can be charged as a fixed fee or a percentage of the total fund.
- Withdrawal fees – A fee may apply every time a member wishes to withdraw their money from the fund. The fee is usually a fixed dollar amount.
- Investment switching fee – Charged for switching your investments. The fee is usually a percentage of your total fund.
Fund value: $500,000
Annual Administration Fee: 2.05%
Management expense ratio: 2.5%
Entry fee: 4%
Cost to enter the fund: $20,000
- Annual Administration Fee: 10,250
- Management expense ratio: 12,500
A self managed superannuation fund can be operated at a much more cost effective level. The fees charged above are for each individual fund; in a SMSF you can have up to four members in the one fund.
On average, the cost to maintain an SMSF with a balance of $500,000 per member is fixed at approximately $3300 in total. This offers great value in comparison to some general and industry super funds.