MySuper is a low-cost and simple superannuation product that will replace existing default superannuation funds from 1 July 2013. Some of the standards that MySuper products will have to meet include:

• No entry fees, with exit fees limited to cost-recovery;
• A ban on commissions;
• A single investment strategy set by the trustee; and
• New standards around the payment of performance fees to fund managers.

This initiative is likely to be an ideal structure for younger people with moderate superannuation balances as it will ensure their benefits are not eroded by excessive fees and/or adviser commissions.

However one of the drawbacks of MySuper is that the fund will have a single, diversified investments strategy. Unfortunately this places everyone in a one size fits all model. Whilst this may be appropriate for some, it is our belief that as an individual’s superannuation balance increases that control and flexibility is paramount.

As retirement planning becomes a higher priority it is essential that you have the capacity to construct an investment strategy that is specifically tailored to meet your individual requirements and objectives. Unfortunately MySuper does not provide this flexibility.

It is fair to say that MySuper, whilst a good initiative, is not the ideal structure for everyone.