Superannuation fees fall again

This marks the sixth consecutive year of falling superannuation fees, according to research from Rainmaker Information’s Superannuation Benchmarking Report.

Rainmaker estimates that super fund members, including self-managed super fund members, paid an industry aggregate $34 billion in fees in 2024-25.

While this translates into an increase of 5% for total fees paid in dollars, it was outpaced by a growth of 7% across superannuation funds under management (FUM).

“Seeing fees continue to fall is a great result for members, which have reduced from 1.11% pa in 2019,” said Dr. David Gallagher, executive director of research at Rainmaker Information.

“Super fund consolidation and their respective FUM growth has created increased economies of scale, which, alongside increased investments in indexed products, have been two key drivers for fees declining in percentage terms.”

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Fee benchmarks continued to fall across MySuper and workplace products but went up for personal and retirement products.

MySuper remains the most fee-competitive segment. Overall, average MySuper fees fell for the seventh consecutive year, reducing by 0.07% to 0.87% pa.

Within this segment, not for profit MySuper products recorded an 8% drop in TER to 0.85% pa, while retail MySuper products experienced a small increase of 2%, to a TER of 0.96% pa.

Personal product fees went up by 9%, the biggest increase across all segments, while retirement product fees increased by 4.7%, driven by increases in retail retirement products.

In contrast, not-for-profit retirement product fees dropped by 4%.

“The key reason why not for profit funds are cheaper than retail funds is lower ongoing administration fees,” said Dr. Gallagher.

“Not-for-profit funds have an average 0.11% admin fee advantage (unchanged from last year), while retail funds have an average 0.05% investment fee advantage (down from 0.07%).”

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