I’m annoyed! But rather than pointlessly vent, this soapbox article is an attempt to turn my recent annoying experience into a useful lesson for all.
Many people I meet are wary of going to their bank to get financial advice. They say they don’t want to just be sold the bank’s products.
The Industry Super Fund Network loves criticising financial advisers on the same issue and a related issue about commissions.
Well a financial adviser from a major industry super fund just disclosed that his job is to keep accounts within his employer’s product. (Like bank advisers he wouldn’t be authorised to advise on anyone else’s product anyway.)
The lesson here is to have your eyes wide open if you get advice from the advisers tied to your industry superannuation fund. It could be just as restricted as if you get advice from your bank.
Don’t assume the advice will be in your best interests having considered all available options.
I say that last bit because it was a discussion about the limitation of his employer’s product that led the adviser to the inadvertent disclosure. He was annoyed at the product’s limitation which could ultimately result in $500,000 dollars flowing out of the product to a retail superannuation fund. (And it wasn’t even a fancy facility I was looking for – just something pretty simple.)
So my mind wonders…do the industry super fund’s advisers not recommend certain actions to clients because their product couldn’t facilitate it?
I err on the side of trust in people’s positive intent and assume the industry super fund advisers don’t consciously make such limited recommendations. But maybe their brains are so accustomed to the limitations that their brains no longer even flag the alternate strategies for consideration? Hmm…
So beware – the advice from industry super funds may be cheaper in fee but costly in consequence. Importantly don’t assume it is any less conflicted or limited than the advice from your bank that you are so wary of.