Employees of Rutila Resources – MySuper
The recently enacted MySuper legislation has the effect of creating a new Colonial FirstChoice Employer Super (CFS – FCES) Plan Default Fund which will impact all employees who are a member of the current Rutila Resources Superannuation Plan.
Employees who are not a member of the Rutila Resources Superannuation Plan through CFS – FCES AND who have directed superannuation contributions to a Self Managed Superannuation Fund (SMSF) will be unaffected and can ignore this communication.
Employees who are not a member of the Rutila Resources Superannuation Plan through CFS – FCES, AND who currently have employer superannuation contributions directed to an alternative Product Provider should contact that Product Provider in order to establish what actions may be required to be taken. This note is not relevant to your circumstances.
Colonial First State are launching their MySuper Superannuation investment option on 11 June 2013 as part of their existing product known as Colonial FirstChoice Employer Super (CFS – FCES). All future employer superannuation contributions post 11 June 2013 will be affected and therefore your consideration of the issues summarized below is required.
CFS – FCES’s MySuper investment option is a Lifestage option. This will become the new Default Plan option with effect from 11 June 2013. There are 11 investment options automatically allocated based on your birth date.
|
Designed for people born within this five year age band |
Option Name |
|
1945 and 1949 |
FirstChoice Lifestage 1945 to 1949 |
|
1950 And 1954 |
FirstChoice Lifestage1950 to 1954 |
|
1955 and 1959 |
FirstChoice Lifestage 1955 to 1959 |
|
1960 and 1964 |
FirstChoice Lifestage1960 to 1964 |
|
1965 and 1969 |
FirstChoice Lifestage1965 to 1969 |
|
1970 and 1974 |
FirstChoice Lifestage1970 to 1974 |
|
1975 and 1979 |
FirstChoice Lifestage1975 to 1979 |
|
1980 and 1984 |
FirstChoice Lifestage1980 to 1984 |
|
1985 and 1989 |
FirstChoice Lifestage1985 to 1989 |
|
1990 and 1994 |
FirstChoice Lifestage1990 to 1994 |
|
1995 and 1999 |
FirstChoice Lifestage1995 to 1999 |
The new Investment menu comes into effect on 11 June 2013.
To open an enlarged version of this diagram in a new window, please click here
What are my options in respect of your future contributions?
· Option 1 – Do nothing and remain in CFS – FCES’s Default investment option (if that is your current investment choice).
· Option 2 – Do nothing and remain in your current CFS – FCES’s investment choice option/s.
· Option 3 – Make an alternative investment selection.
Option 1 – Do nothing and remain in the Plan Default investment option
If you have never elected an Investment Option, your current contributions are being directed into the current Default option, being FirstChoice Moderate. All future contributions from 11 June 2013 will automatically be paid to one of the 11 new Default options noted above, based on your date of birth.
Option 2 – Do nothing and remain in your chosen CFS – FCES investment option
If you have a current CFS – FCES Investment choice option/s other than the Default investment option, all future contributions will be paid to the same fund.
You should also be aware that CFS – FCES has revised fees for all funds in its investment suite with effect from 11 June 2013 (Refer attachment).
Other than the new default Lifestages Option, these fees are higher than what you are currently paying.
You should refer to the CFS – FCES correspondence you have received to determine the specific costs related to your particular investments.
Option 3 – Make an alternative investment selection in respect of your future contributions
After 11 June 2013, you may wish to continue to direct your future contributions to the FirstChoice Moderate Fund, or change your current CFS – FCES investment selection, in which case you will need to complete an Investment Selection Form or do a switch online. Do not use the Investment Selection for Future Contributions form you received in the mail recently.
In this case the new fee scale will apply for future contributions from 11 June 2013.
What are my options in respect of the current balance in my superannuation fund?
Once the new PDS (Product Disclosure Statement) has been established on 11 June 2013, you may switch your existing balance by completing an Investment Selection Form or do a switch online.
Please note: If you are currently invested in the current Default option (FirstChoice Moderate), your future contributions will be invested in 1 of the 11 Lifestages options noted above. You will therefore have funds in both FirstChoice Moderate AND Lifestages. Should you wish to combine both fund balances into your new investment selection, you will need to complete an Investment Selection Form or do a switch online.
Comparison of costs associated with the:
· Current Default Fund (FirstChoice Moderate) – up to 11 June 2013
· New (FirstChoice Lifestages) Default fund – post 11 June 2013, and
· New costs of FirstChoice Moderate – post 11 June 2013
In the table below:
· The first column relates to the costs in respect to your current balance pre 11 June 2013.
· The 2nd column is the new default option post 11 June 2013.
· The 3rd column relates to the costs applicable to contributions post 11 June 2013 (should you wish to remain in the same default investment option in which you are currently invested).
· Should you wish to continue with the current default option (FirstChoice Moderate) or your current investment selection, you will need to complete the Investment Selection Form or do a switch online .
· In this case the fee per the table below, will apply only for new contributions from 11 June 2013.
Comments on Asset Allocation:
- In the table below you will notice that in 7 of the 11 Lifestage options, the asset allocation is 90% Growth and 10% Defensive.
- The current default asset allocation of FirstChoice Moderate is 60% Growth and 40% Defensive.
- Asset allocation is a key consideration in fund selection and is dependent on your personal risk profile and risk appetite.
Can I select from any of the 11 Lifestage options?
If you do not wish your super contributions to be automatically allocated to a Default Lifestage fund based on your date of birth, you can select an alternative band which better suits your risk appetite. This can only be done after 11 June 2013 by completing an Investment Switch Form or do a switch online.
What happens if I am not a current member of Colonial FirstChoice Employer Super and wish to join?
If you are an existing employee, you are required to complete a Superannuation Choice Form available from Angela. All new contributions after 11 June 2013 will then be directed into one of the new 11 default Lifestage options on CFS-FCES.
Please feel free to call Brian or myself if you have any questions, concerns or suggestions at anytime.
Brian May
phone: +61 2 9392 8700
email: brianm@horizonwealth.com.au
Kind regards
Angela Newby
Office Manager
General Advice Disclaimer
This document is not meant to replace or contradict the PDS (Product Disclosure Statement). You are advised to read the PDS should you wish to obtain the full meaning of any terms or benefits noted above.
This information was prepared by Horizon Wealth Management. It is of a general nature and does not take into account your personal investment objectives, financial situation or particular needs. You should assess whether this general advice is appropriate to your individual objectives, financial situation and needs. You can make this assessment yourself or seek the help of a professional financial advisor or taxation professional.