Some More Super Options

Two more Super Fund options I've come across recently.

Firstly, for those who want Vanguard funds but don't need to 'customise', there's Bendigo SmartStart Super.

Bendigo and Adelaide Bank's offerings have asset allocation managed by Sandhurst Trustees.  But the underlying investments for their diversified index fund offerings (i.e. in Shares, Property, Fixed Interest, but not Cash) are managed by Vanguard.

The particular funds of interest are:  Bendigo Defensive Index Fund, Bendigo Conservative Index Fund, Bendigo Balanced Index Fund, Bendigo Growth Index Fund, and the Bendigo High Growth Index Fund. They also have actively managed funds with higher fees.

There's a base fee of $98 per annum so, like most industry funds, they're not cost effective if you have a very small balance.  The MER (Investment Fee) ranges from 0.39% - 0.46%.  This is less than the ANZ equivalent, albeit with less flexibility to customise the allocation (the most you can do is mix-and-match to get an 'in-between' allocation).  There are no Withdrawal or Switch fees but there is a buy-sell spread of 0.20-0.25% to recover transaction costs.  The 'Neutral' asset allocation is listed along with the MER below:

	Defensive	Conservative	Balanced	Growth	High Growth	Cash
MER (Investment Fee)	0.39%	0.41%	0.43%	0.45%	0.46%	0.40%
Australian shares	9%	20%	33%	42%	50%
International shares	7%	15%	20%	30%	37%
Property securities	4%	5%	7%	8%	10%
Australian fixed interest	30%	22%	17%	8%
International fixed interest	25%	18%	13%	7%
Cash	25%	20%	10%	5%	3%	100%

Overall, for asset allocations around the 'Balanced' mark, they're probably not as good value as an Industry Fund.  Their 'Growth' and 'High Growth' fund are pretty good value for someone who wants a more aggressive allocation but wants it all in a single diversified fund.  If you're willing to set a similar allocation yourself, as I was, Sun Super is still lower-cost using State Street Global Advisors as underlying fund managers.

Another fund I've come across recently is potentially useful as a specialist option only.  In general their costs are not as low as most index funds.  However Hesta are the only fund I've come across which offers Unlisted Infrastructure at a reasonable fee.  They have a $65 + 0.08% administration fee and the Infrastructure option has a an Investment Fee of 0.77% (so total 0.85%).  The option holds 5-15% cash, presumably to ensure it stays sufficiently liquid.

I wouldn't use this as the core of my superannuation, as it's not as diversified or low-cost as shares, but I can imagine once I have a large enough balance that having a percentage in the Industry Funds' Infrastructure pool might be desirable.  This is an asset I typically would have limited access to, even through a Self-Managed Fund. For example, if I had a total portfolio of $500,000 and wanted ~8% ($40,000) in Infrastructure then the fees ($65 + 0.85%) would be around 1%.  Too high for the bulk of my funds but perhaps useful for additional diversification.

Hopefully it (or a similar new option) is still around in, say, 10 years once I have a sufficient portfolio to justify such an investment. One other thing to note is that they don't allow this separately in their Pension product so it may only be efficient prior to retirement.

Links:
Bendigo SmartStart Super

Bendigo SmartStart Super Fees (see page 14)
Hesta
Hesta PDS (see page 8 for administration fees)
Hesta Investments/Investment Fees (see page 19 for Infrastructure)