SMSF Insights FSC/UBS SMSF Report December 2015

Transcription

1 SMSF Insights FSC/UBS SMSF Report December 2015 SMSF Average Exchange owners 15 fund size 16 Traded Funds 18 59% of SMSFs set up their fund for greater control and choice 45% of SMSF funds are worth $200,000 to $1 million 20% of SMSFs are investing in ETFs

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3 Contents 04 Foreword 07 Report highlights 08 SMSFs in Australia 12 Key findings 14 National survey results 24 Research methodology 25 Survey sample profile 26 About this report 3

4 Foreword Financial Services Council Sally Loane Chief Executive Officer Financial Services Council Now 23 years old, Australia s $2 trillion superannuation system is rightly a point of national pride. Superannuation accounts for 80% of the $2.6 trillion of funds under management in Australia and it will continue to grow from strength to strength as the system matures. Deloitte has forecast that super funds under management will grow to $9.5 trillion by 2035 just two decades from now. It will be the second largest asset that most Australians will have outside of the family home. SMSFs have an important role in our superannuation system and in helping Australians self-fund their retirement. This report a survey of more than 600 SMSF owners shows they are engaged with their super which is great news. More than half of the retirees in the survey 53% are entirely or mostly dependent on their SMSF to fully fund their lifestyle while 46% of future retirees expect to depend on their SMSF to fully or mostly fund their retirement. It is also encouraging to see that professional advice plays a key role in SMSF planning across all fund sizes. The majority of SMSF owners 69% have formal arrangements for the management of their investments with financial advisers and accountants. As Australians live longer and super fund sizes continue to grow, financial advice will continue to play an important role in the SMSF market and in helping people to grow their wealth. We hope you enjoy reading this report. 4

5 Foreword UBS Asset Management Australia remains in a unique global position. Despite our small population of only 24 million people, Australia continues to be the fourth largest superannuation market globally with more than $2 trillion worth of assets held in superannuation funds (as at the end of June 2015). Self-managed superannuation funds (SMSFs) are one of the fastest growing components of this asset pool, with more than $589.9 billion of Australia s superannuation being currently held in a SMSF. As such, the growth of the SMSF subsector makes it an integral component of Australia s unique market. The financial services industry has a responsibility to educate and enable Australians to save for a comfortable and dignified retirement. The need to reduce the dependence of Australian retirees on government welfare has never been greater. There is an obligation and an opportunity for the funds management industry to develop innovative products that provide access to attractive investment opportunities. We are pleased to partner with the Financial Services Council (FSC) for the second year to commission this report. The report includes an analysis of the rapid growth of the SMSF sector, profiles SMSF investors and explores their views on investing, as well as their investment allocation decisions. Bryce Doherty Head of Australia and New Zealand UBS Asset Management 5

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7 Report highlights Why SMSFs? Changes in key investment choices for SMSFs 59% wanted more control and choice over their investments 48% followed the recommendation of their financial adviser/accountant Deposits/cash 67% 85% Managed funds 49% 40% Domestic equities 46% 53% Softer growth in Exchange Traded Funds a growing trend in SMSFs 20% 10% currently use plan future use Industry-wide rate of return SMSFs grew more than 10% SMSFs grew up to 10% % 11.6% 7% 17% 67% 67% Dependency on SMSFs for income in retirement SMSFs frequently monitored but strategy evaluated over longer term Check portfolio Change portfolio 53% of retirees are entirely or mostly dependent on their SMSF Monthly or more 63% 25% Quarterly 23% 29% Annually 14% 47% 46% of future retirees expect to be entirely or mostly dependent on their SMSF 7

8 SMSFs in Australia 8

9 Australian superannuation assets increased by 9.9% over , totalling $2.0 trillion at the end of the June 2015 quarter. 1 This included $589.9 billion in Self- Managed Super Funds (SMSFs), leading the other major fund categories of Retail ($535.9b), Industry ($432.8b), and Public Sector ($219.3b). SMSFs recorded a solid 6.1% increase in the year This important study, commissioned by the Financial Services Council and UBS Asset Management, is now in its second year of profiling and exploring the views of Australians with SMSFs. This report details the findings from the 2015 national telephone/online survey of 601 SMSF holders, and draws comparisons to 2014 results on key questions. Australian SMSF holders The largest group of SMSF holders are those currently transitioning from their final years of full-time employment into retirement year olds make up 30% of SMSF members, with men and women evenly represented among this group. 2 Those transitioning into retirement are likely to remain a key group for SMSFs into the future. The latest Deloitte Dynamics of the Australian Superannuation System report 3 predicts SMSFs will continue to grow for pre-retirement assets but will come to dominate the post-retirement assets market over the next 20 years. 1 Quarterly Superannuation Performance (APRA, June 2015) 2 Self-managed super fund Statistical Report (ATO, June 2015) 3 Dynamics of the Australian Superannuation System: The next 20 years (Deloitte, November 2015) 9

10 The transition years Amongst the members we spoke to this year, those in the year age group typically came to SMSFs from industry (40%) and retail (28%) funds, seeking more control and choice (60%), and via a professional recommendation from their financial adviser or accountant (54%). They were generally well placed in terms of receiving formal financial advice (67%) and having a set retirement plan (50%), and they felt empowered by the level of engagement and control offered by SMSFs. I prefer to take charge of my own future. I feel connected to my super and future. I like the excitement of researching and making my own decisions. I am able to make decisions from day-today, I have become more informed. The men in this age group were particularly engaged with their SMSF 40% checking their portfolio daily/weekly compared to only 25% of their female counterparts. Men in this group also saw the tax benefits during this key transition period as an advantage of SMSFs... Control over my investments with good tax breaks.... while practical concerns such as flexibility, ease of use, and cost were valued by their female counterparts: The charges for managing the fund are low and it gives me the ability to manage the fund myself online so I can move the amounts myself. It has done very well and I have no stress in operating it. We have invested in property which we have the option to live in when we retire. It enables more concrete retirement planning. Once we finish making contributions it is not to say we wouldn t change our investment mix. 10

11 Taking a more cautious approach at this life stage, year olds had concentrated their SMSF investments in deposits/cash, managed funds, domestic equities: I am getting ready to retire and am sitting on everything as it is. I just stick to what I know and understand equities. However, despite their conservative approach, most enjoyed up to 10% growth in their SMSF this year (70%), some even exceeding this level (8%): It is performing reasonably well, I am getting good dividends which I am reinvesting. I have realised over 10% on my principal regardless of withdrawals.... and while many 55 64s were (or will be) mostly or entirely reliant on their SMSF for income in retirement (53%), their fund sizes were relatively large (41% at $0.5m+), with one retiree commenting: I live a great life supported by my super fund. I ve outperformed most of the major funds. survey size=188 % SMSFs have any investment in... Average % invested in... Deposits/cash 68% 24% Managed funds 48% 26% Domestic equities 45% 20% Overseas equities 22% 4% Exchange traded funds 17% 5% Domestic bonds 17% 4% Listed property 16% 5% Direct commercial property 4% Direct residential property 6% Overseas bonds 9% 1% 11

12 Key findings 12

13 Australians crave control and choice in Super investments Achieving greater control and choice of investments (59%) is still the key driver for setting up an SMSF and a source of satisfaction among those who have made the switch I have complete control, costs are low and performance has been good. SMSFs move away from deposits/cash in favour of managed funds Many SMSFs have moved out of deposits/cash in the last 12 months in favour of managed funds. Despite this shift, deposits/cash (67%), managed funds (49%) and domestic equities (46%) remained the top choices for SMSFs and, within managed funds, deposits/cash (52%) and domestic equities (50%) also dominated overseas products and property. International markets appeal to ETF users Exchange Traded Funds (ETFs) were used by 20% of fund holders this year, with a further 10% intent on incorporating them into their future SMSF strategy. International markets are an important point of difference with 42% of users citing access to these as a reason they use ETFs, and 41% using ETFs to invest in global equities. Closing the awareness/ knowledge gap among SMSF holders will be important to growing future take-up of ETFs, with 27% of non-users citing this as a current barrier I am just not up on ETFs. Professional financial advice behind many SMSFs from establishment Professional advice plays a key role in SMSF planning across all fund sizes, with 69% of SMSF members in a formal arrangement to receive advice from financial advisers, accountants and/or banks. Professional recommendations figured prominently as a reason for setting up an SMSF (48% members) and influenced the ongoing profile of the fund. Those in formal arrangements with financial advisers and banks were more likely than other groups to be invested in managed funds, ETFs, overseas equities and bonds, and listed property and to be leveraged for property or equity through their SMSF. They were also more likely to consider diversifying into international shares, bonds and property and, in retirement, buying a product that provides an income stream from their SMSF. Pre-retirement caution begins from age 45 The influence of life stage on accepted level of risk continues to play out in the SMSF strategies pursued by adults aged under 45, versus their older counterparts. A higher proportion of retirees were in safer options such as managed funds and domestic equities. In contrast, more than twice as many 18 44s were leveraged for property or equities (46%), or considering diversifying into international investments (shares, bonds, property) (38%), compared with older adults (17%,16%). An SMSF holder in their pre-retirement years summarised their cautious approach as: At this stage I am close to retirement, in low risk and I don t want to jeopardise what I have. Despite lower rate of returns for Super, some SMSFs still enjoy above average growth A majority of SMSF holders, 74%, enjoyed growth in their fund over the financial year. This included 7% who recorded more than 10% growth. However, overall, growth was somewhat weaker than in , when 84% of SMSF fund holders experienced growth, and the overall industry-wide rate of return (ROR) was 11.6%. 13

14 National survey results Detailed findings from the survey 14

15 Other comments from members about their experience, since setting up their SMSF, included: Setting up an SMSF The vast majority of respondents had Superannuation funds prior to setting up their SMSF mainly in Industry (38%) and Retail (31%) funds and a desire for more choice and control over their investments (59%) was the key driver for change. Also important in this decision were professional recommendations from financial advisers and/or accountants almost half (48%) of the SMSF holders we spoke to set up their fund as a result of this advice. In fact, the number of respondents setting up an SMSF on the advice of a financial adviser (32%) has increased since our 2014 survey (28%). The best thing I ever did. I was losing so much money when my super was in someone else s hands but now, since I am making the decisions, I am making money and lots of it. I have complete control, costs are low and performance has been good. I listened to non-professionals and made some very poor financial decisions before finding a really good financial adviser. His advice had been very sound, so I accepted his advice regarding my super fund. After four years of retirement and four years of meeting living costs and unforeseen costs, I still have the initial starting capital I retired on. It has allowed me to retire early and gives me a reasonable return to maintain a steady income during retirement. 15

16 SMSF fund profile Trustees Most of the SMSF holders interviewed were either the sole trustee or member (39%) or one of only two (53%). Only 8% of respondents were part of an SMSF with a larger membership. Size of fund Fund size varied widely with approximately one third holding below $200,000 (32%), a quarter between $200,000 and $499,999 (25%), and another third at $0.5m or more (34%). Most of those unsure of their fund size were receiving formal advice from a financial adviser, accountant or bank. Feedback from SMSF holders indicates some have a low level of personal involvement in their superannuation arrangements because they rely on their advisers to do the job. Q. What is the approximate size of your current self-managed super fund? (survey size=601) $0 to $99,999 19% $100,000 to $199,999 13% $200,000 to $499,999 25% $500,000 to $999,999 20% $1,000,000 or more Don t know 9% I m paying someone to do this, so I don t interfere with it and if any changes are needed they ring me. Managed funds Similar to the 2014 survey, managed funds continued to be a popular investment vehicle for SMSFs and, while their asset profile was quite diverse, there was a clear leaning toward deposits/cash and domestic assets over international investments and property. Half of respondents reported their managed fund invested in deposits/ cash (52%), and domestic equities (50%), while around 3 in 10 were in overseas equities (32%) and/or domestic bonds (29%). While a large proportion were unsure of the investments made by their managed fund (31%), the majority of this group had a formal arrangement to receive financial advice and appeared to be leaving the details of their SMSF investments to these advisers. Q. Which of the following types of assets does your managed fund invest in? (survey size=298,239 SMSF in managed funds) 52% 51% 50% 51% Deposits/cash Domestic equities 32% 36% 29% 31% 26% 28% Overseas equities Domestic bonds Listed property Overseas bonds 19% 24% Direct commercial property Direct residential property 14% 16% 11% 11% Don t know 31% 27% 16

17 Investment mix In 2015, SMSF investment remained concentrated in deposits/cash, managed funds and domestic equities. Overall, these were the most popular asset types/investment vehicles. Twothirds of members had at least part of their SMSF in deposits/cash (67%), and almost half had some in managed funds (49%) and/or domestic equities (46%). Among the fund holders we spoke to, on average, around a quarter of their SMSF investment was in deposits/cash (24%) and managed funds (25%), and 19% was in domestic equities. Compared to our 2014 survey, fewer members were in deposits/cash or domestic equities in 2015 and the proportion of their SMSF invested in these assets was smaller. In contrast, more members were using managed funds in 2015 and investing a greater proportion of their SMSF through these funds. Q. Approximately what percentage of your self-managed super fund investment is in..? (survey size=601,600) %SMSFs have any investment in.. Average % invested in... Deposits/cash 67% 85% 24% 35% Managed funds Domestic equities 49% 40% 46% 53% 25% 19% 23% Overseas equities Exchange traded funds* 23% 20% 26% 5% 4% 5% Domestic bonds Direct residential property 19% 23% 19% 19% 4% 5% 8% 7% Listed property Direct commercial property 18% 22% 5% 4% 4% 4% Overseas bonds 9% 13% 2% 2% * Exchange Traded Funds not asked in

18 Exchange Traded Funds Exchange Traded Funds (ETFs) have been one of the fastest growing categories of investment products in recent years, offering flexibility, low costs and transparency. ETFs played a role in the SMSFs of one in five (20%) respondents in with portfolio diversification (54%), low costs (44%) and access to international markets (42%) being key reasons for embracing ETFs. While a majority used ETFs to invest in Australian equities (77%), the interest in international markets was evident in the sizeable number who used ETFs to invest in global equities (41%). Q. Which of the following types of asset classes do you use exchange traded funds, or ETFs, to invest in? (survey size=120 used ETFs) Q. Which of the following best describes why you use ETFs? (survey size=120 used ETFs) 77% Diversification of portfolio 54% Low costs 44% 41% Access to international markets 42% Australian equities Global equities Commodities 26% Currency Fixed income 16% 16% Don t know Better ease of access/liquidity than managed funds Some other reason Don t know 3% 13% 21% While use of ETFs among SMSF holders has been limited so far, there is potential for short term growth with a further 10% of respondents intending to use ETFs in the future (5% within the next 12 months). In addition, despite their growing popularity, lack of awareness and understanding of ETFs was a key barrier for non-users, 27% felt they didn t know enough about ETFs to incorporate them into their SMSF strategy. As this awareness gap closes, more may be encouraged to embrace ETFs. Q. Approximately what percentage of your self-managed super fund investment is in exchange traded funds? / Q16a. Which one of the following best describes your likely use of exchange traded funds, or ETFs, in your future SMSF strategy?(survey size=601) 5% Intend to use > 12 months 5% Intend to use next 12 months 20% Current ETF user 34% Unsure 37% Will not use ETFs Comments from SMSF members on why they are not currently using ETFs: I am just not up on ETFs. I did not understand how they worked until recently. I ve read articles by Etrade, CommSec and the ASX website and now have a proper understanding. Q. For what particular reasons do you not currently / intend to use ETFs in your SMSF strategy? (survey size=481 not used ETFs) Don t know enough about ETFs 27% At this stage I am close to retirement, in low risk and I don t want to jeopardise what I have. Dislike ETFs Professional/other family is decision maker 14% 13% I have a financial adviser to take care of my fund. Not suitable/appropriate for strategy Prefer other investment types Other 4% 6% 12% Not what our financial planner has suggested. Don t know 26% 18

19 Diversification and leverage With SMSF and managed funds concentrated in a small set of asset types, some respondents were considering diversifying their portfolio through direct investments in infrastructure companies (10%), or in international shares (16%), bonds (6%), or properties (5%). Interest in these international options was much stronger among younger adults (38%) than the more risk averse older groups contrasting infrastructure companies, which were fairly equally favoured, by about one in ten in each age group. Q. Are you currently considering diversifying your self-managed super fund portfolio into any of the following? (survey size=601) Total years years years 65+ years % of SMSF members survey size= Total consider any International: 19% 38% 19% 16% 14% International shares 16% 26% 17% 13% 13% International bonds 6% 23% 5% 3% 2% International property 5% 21% 4% 3% 1% Consider shares in infrastructure companies 10% 13% 11% 9% 9% None of the above 41% 25% 35% 41% 52% Not sure 35% 35% 41% 38% 30% Similarly, a total of 22% were leveraged for property (), equities (11%), or other assets (1%) through their SMSF, with younger adults much more likely to be leveraged than those closer to, or already in, retirement. Q. Are you leveraged for any of the following through your self-managed super fund? (survey size=601) Total years years years 65+ years % of SMSF members survey size= Total leveraged for: 22% 46% 28% 12% Property 38% 21% 11% 5% Equities 11% 28% 12% 7% 8% Other assets 1% 1% 0% 1% 2% Not leveraged 51% 29% 42% 52% 67% Not sure 27% 25% 30% 33% 21% Life Insurance 13% of SMSF holders have life insurance through their SMSF. (A further 14% have life insurance through other means.) 19

20 Using professional financial advice Formal arrangements to receive financial advice are common among SMSF holders, with a majority (69%) receiving advice from Financial Advisers (46%), Accountants (25%), and/or Banks (11%). Professional financial advice is not something limited to higher value funds. Thirty per cent of those using a financial adviser have less than $200,000 in their SMSF ( have less than $100,000) and usage peaks for funds with $200,000 $499,999 (30%). Those using an accountant tend to have higher value funds with close to half (46%) holding $0.5m or above. The opposite is true of those receiving formal advice from banks, who tend to have smaller funds (49% are under $200,000). Q. What is the approximate size of your current self-managed super fund? (survey size=601) by Do you have a formal arrangement to receive financial advice from any of the following? (survey size=601) 35% 30% 25% 20% 28% 19% 21% 30% 26% 25% 23% 24% 20% 22% 10% 13% 19% 10% 9% 5% 3% 0% <$100k $100-$199k $200-$499k $500-$999k $1m+ Advised by Financial Adviser Advised by Bank Advised by Accountant Total SMSF holders The fund profile of SMSF holders also varies depending on whether professional financial advice is received, and from whom. Those in formal arrangements with financial advisers and banks were more likely to have their SMSF invested in managed funds, ETFs, overseas equities and bonds, and listed property and to be leveraged for property or equity through their SMSF. They were also more likely to consider diversifying into international shares, bonds and property and, in retirement, buying a product that provides an income stream from their SMSF. Those being advised by banks or accountants were more likely to favour direct residential property. Formal financial advice can be powerful. When asked why they are not using ETFs, one member commented: Not a priority, my broker and adviser have not suggested it. 20

21 SMSF activity Overall 47% of respondents did not make any contribution to their SMSF last financial year (similar to 44% for ) among retirees this was a majority (73%). Among those not yet retired, about a third (32%) were unable or chose not to contribute to their fund this year, and few of these non-contributors (20%) said they were likely to add to their SMSF next year. Q. Approximately how much did you contribute into your self-managed super fund in the last financial year (ending 30 June 2015)? (survey size=601) 72% Concessional Non-Concessional 55% Total 47% 11% 9% 12% 7% 10% 7% 13% 5% 2% 8% 3% 2% 5% $0 $100,000 or more $1 to $999 $30,000 to $99,999 $1,000 to $9,999 $10,000 to $29,999 Among those who did make a contribution to their SMSF in , a majority (75%) said they were likely to maintain (45%) or increase (30%) their level of contributions next year. For those not yet retired, this was 82% (including 36% who will contribute more) with only 7% likely to reduce their contributions next year, and 11% undecided. Q. Are you likely to contribute more or less into your self-managed super fund during this financial year (ending 30 June 2016) or will it be about the same as last year? (survey size=313 contributed to super in ) Likely to contribute more Likely to contribute about the same Likely to contribute less Not sure/undecided 12% 13% 30% 45% Annual draw down Similar to , a majority of retired SMSF holders drew down less than $50,0000 on their superannuation last financial year. Almost half (48%) drew down less than $25,000. This suggests a large proportion of these retirees were accessing additional income from other sources or living on a modest retirement income. Q. How much did you draw down on your superannuation in the last financial year (ending 30 June 2015)? (survey size=236 retirees) $0 to $24,999 $25,000 to $49,999 $50,000 to $74,999 $75,000 to $99,999 6% 12% 21% 48% $100,000 or more 4% Don t know 9% 21

22 Growth A majority of respondents, 74%, experienced growth in their fund over the financial year, however this compares with 84% in our 2014 survey. This drop is partially due to an increase in those recording zero growth (10%), or unsure of their fund s performance (). However, the largest decrease in growth was at the upper end, with only 7% enjoying more than 10% growth in their SMSF this year (down from 17%). Importantly, this 7% enjoyed growth above the industry-wide ROR for entities with more than four members, which was 8.9%, down from 11.6% in Q. How much did your superannuation fund grow by in the last 12 months? (survey size=601) 0% 7% 10% Greater than 0% and less than 5% 31% 33% Between 5% and 10% 34% 36% More than 10% 7% 17% Don t know 9% Engagement with portfolio Member engagement with SMSFs was high, with 63% checking their portfolio at least once a month 35% at least weekly. Weekly checking was even higher among retirees (42%). While some SMSF holders also made frequent changes to their portfolio, the majority were only doing so on a quarterly (29%) or annual (47%) basis. Non-retirees tended to make changes a little more frequently than retirees (28% vs 20% at least monthly). This indicates that, overall, while most members like to closely monitor their investments, they tend to evaluate and change their strategy over a longer period. Q. How often do you check or make changes to your self-managed super fund portfolio? (survey size=601) Daily 2% Weekly 20% 6% Monthly 29% 17% Quarterly 23% 29% Annually 14% 47% Check Make changes 4 Quarterly Superannuation Performance (APRA, June 2015) 22

23 Retirement Planning for retirement A majority of SMSF holders have at least started thinking about planning for retirement but only 38% have already made a plan (16% have a detailed plan). Again, this is driven by age with most younger adults (18 44 years) either yet to plan at all (38%), or just starting to think about it (40%). Q. To what extent have you planned your finances for retirement? (survey size=365 not yet retired) Have a detailed plan Have a plan already 16% 22% Started planning it 16% Started thinking about it 24% Yet to plan 22% Interest in annuities from SMSFs Among SMSF holders not yet retired, there is sizeable demand for annuities and allocated pension products with 40% claiming they would be likely to buy a product that provides an income stream (e.g. annuity or allocated pension) from their SMSF. Q. How likely would you be to buy a product that provides an income stream (e.g. annuity or allocated pension) from your self-managed super fund? (survey size=365 not yet retired) 34% Unsure 14% Very likely 26% Quite likely 11% Quite unlikely 16% Very unlikely Dependency on SMSF Almost half (49%) of respondents felt they were, or will be, entirely or mostly dependent on their SMSF fund for income in retirement. Among retirees, 24% said they are entirely dependent on it. For most of those entirely/mostly dependent on their SMSF, the current size of their fund was more than $200,000 (71%), including 49% who have at least $500,000 to put toward a comfortable retirement. Q. To what extent is/will your disposable income in retirement be dependent on your self-managed super fund? (survey size=601) 3% Not at all 7% Slightly 11% Unsure 17% Entirely 31% Partially 31% Mostly 23

24 Research methodology A national online and telephone survey amongst a survey size of 601 SMSF holders was conducted between 15 October and 5 November The aim of the survey was to quantify the attitudes and behaviours of the SMSF market. Sampling approach Target audience: a nationally representative sample of SMSF holders; Respondents were sourced from leading qualityassured online and telephone panel provider, AFS; Quotas set in line with SMSF member age and gender profiles from the ATO s Self-managed super fund statistical report June 2015; A sample size of 601 (501 online and 100 via phone); Margin of error : +/- 4.0% at the 95% confidence level for a 50% result (i.e. if we obtain a result of 50% from a particular question in the survey, this figure could be as low as 46% or as high as 54% at the 95% confidence level); The survey sample profile contains a breakdown of the sample by key demographics. Questionnaire Weighting and analysis The survey was designed to understand the following about SMSF holders: Demographic profile; Fund profile; Reasons behind their decision to start an SMSF; Contribution and draw down activity; Future planning. The final sample was weighted back to the ATO SMSF holder profile by age and gender. The survey data were analysed using Q software. The relationships between questions were drawn using basic tables and were tested using statistical significance testing at the P<0.05 (5% significance) level. 24

25 Survey sample profile Gender Male 53% Female 47% Age 18 to 44 years 45 to 54 years 22% 55 to 64 years 30% 65 years and over 33% State of residence NSW/ACT VIC 25% 34% QLD 20% WA 11% SA/NT 8% TAS 2% Employment Retired 39% Employed full-time 33% Employed part-time/casually 18% Home duties 5% Unemployed Student 3% 1% Other 2% Personal annual income <$50,000 $50,000 $99,999 31% 37% $100,000 $199,999 $200,000+ 3% Refused 14% 25

26 About this report The Self Managed Super Funds National Survey was conducted by KREAB Research, a division of KREAB, advisers on corporate, financial and public affairs worldwide. This report presents the findings from the current 2015 study and compares these results to the 2014 survey on some key measures. For some questions, percentages will sometimes not add to 100% due to rounding. In preparing this report, we have presented and interpreted information that we believe to be relevant for completing the agreed task in a professional manner. It is important to understand that while we have sought to ensure the accuracy of all the information incorporated into this report, information has been gathered through a sample based survey of the population and qualitative discussion and is therefore an estimate of community sentiment. All significant differences reported are significant at the 95% confidence level. Where we have made assumptions as a part of interpreting the data incorporated in this report, we have sought to make those assumptions clear. Similarly, we have sought to make clear where we are expressing our professional opinion rather than reporting findings. Please ensure that you take these assumptions into account when using our report as the basis for your decision-making. We are more than happy to discuss this analysis. This project was conducted in compliance with AS: ISO20252:2012 guidelines. 26

27 Financial Services Council The Financial Services Council (FSC) has over 115 members representing Australia s retail and wholesale funds management businesses, superannuation funds, life insurers, financial advisory networks, licensed trustee companies and public trustees. The industry is responsible for investing more than $2.6 trillion on behalf of 11.5 million Australians. The pool of funds under management is larger than Australia s GDP and the capitalisation of the Australian Securities Exchange and is the third largest pool of managed funds in the world. The Financial Services Council promotes best practice for the financial services industry by setting mandatory Standards for its members and providing Guidance Notes to assist in operational efficiency. Financial Services Council Lvl 24, 44 Market Street Sydney NSW 2000 T E info@fsc.org.au W UBS Asset Management (Australia) Limited UBS Asset Management Australia offers a range of investment styles and strategies, including a range of equities, fixed income and multi-asset capabilities to institutional investors, intermediaries and retail investors. Drawing on its 30-year heritage, UBS Asset Management strives to deliver outcome-oriented investment solutions for our clients, underpinned by a team-based approach and disciplined risk management. With $43 billion of invested assets in Australia (as at 30 September 2015) and approximately 90 employees located locally, UBS is one of the largest asset management businesses in the Australian market. Globally, with approximately $928 billion of invested assets under management (as at 30 September 2015) and approximately 2,500 employees located in 24 countries, UBS Asset Management is a truly global investment manager. UBS Asset Management (Australia) Limited Level 16, 2 Chifley Square Sydney NSW 2000 T E ClientServices-UBSAM@ubs.com W Disclaimer This document provides information only and is based on the views of surveyed respondents. You should seek independent, professional advice before making any decision based on this information. Information in this report is believed to be accurate, however, subject to any contrary provision in any applicable law, neither UBS Asset Management, the Financial Services Council, nor any related parties, their employees or directors, provide any warranty of accuracy or reliability in relation to such information or accept any liability to any person who relies on it.