VANGUARD SUPER: Vanguard Seeks to Disrupt Australian Retirement Market via Low Fee Route
Posted on 11/12/2022
Vanguard Group Inc., the U.S.-based low-cost index provider, seeks to gain market share in Australia by offering low fees on a debut fund. Vanguard will charge an annual fee for its default offering of 0.58%. The industry average in Australia is above 1% in annual fees. The lower cost pension fund offering is called Vanguard Super. Vanguard developed an accumulation product called Vanguard Super SaveSmart, which includes a MySuper default fund called Lifecycle.
Vanguard has been managing money for Australian clients for over decades.
According to a report from the Association of Superannuation Funds of Australia, Australia’s superannuation assets totaled A$ 3.3 trillion as of the end of June 2022. This is a 0.5% decline from the prior year.
Superannuation funds like QIC, Brighter Super, and Aware Super, dominate the Australian retirement market. Often these superannuation funds charge fees to offset investment, transaction, and administrative costs.