A former Commonwealth Superannuation Scheme and APRA executive has developed a ‘smart default’ fund which he claims could boost retirement balances by more than 35%.
Douglas Bucknell, founder and chief executive of Tailored Superannuation Solutions (TTS),
has developed the world’s first ‘Smart Default’ fund that will result in significant increases to superannuation members’ retirement balances.
Bucknell was previously the chief executive of the Anglican Investment Development Fund (AIDF), and senior policy advisor for the three Commonwealth superannuation funds and APRA.
“This ‘Smart Default’ fund will make a huge impact on the quality of life for Australians entering retirement because it will boost their retirement balances by, on average, at least 35%,” he said.
“We’re able to do this by replacing the one-size-fits-all ‘balanced option’ and simple age-based life-cycling default design, with this ‘smart’ fund.
“The days of simply dumping all members in the same investment option for life should be over,” he said.
The ‘Smart Default’ fund uses a SAAS (software-as-a-service) solution to automatically tailor the existing investment options of superannuation funds to a member’s own projected retirement outcomes.
Last year, 13 super funds were found to have failed the government’s performance test.
Since then, the Australian Prudential Regulation Authority has released the of all the funds it assessed showing another seven, including some of Australia’s biggest MySuper funds only marginally passed the test.
“Superannuation trustees need to focus on improving retirement outcomes for their members, that’s what they’re paid to do,” Bucknell said.
“Our technology delivers on the Productivity Commission’s finding that well designed life-cycle solutions are better than the single strategy, one-size-fits-all, approach.”
“We improve the competitive performance of superannuation funds enabling them to exceed the Federal Government performance targets and deliver superior outcomes to their members,” Bucknell said.