Netwealth review

• Superannuation products for consumers at all stages with support for institutional investors and investment professionals.
• Free research account to familiarise yourself with the online platform and investment options available.
• PC, mobile and tablet access to your account, matched with automated alerts, portfolio management, investment tools and performance reports.

Netwealth offers retail superannuation products to Australians. It describes itself as a super fund, a technology company and an administration business. Netwealth is a fast growing financial services technology (fintech) known for its use of advanced technologies. Its membership is open to all Australians.

What is Netwealth?

Netwealth was founded in 1999 to challenge the conventional financial service companies in Australia. Today it has become one of Australia's high-growth wealth management businesses with more than 100,000 Netwealth account holders and more than $64 billion worth of assets under its management. A network of more than 3500 advisors use the Netwealth platform.

Who is Netwealth for?

Netwealth wants to help you “see wealth differently and discover a brighter future”. Their offerings are intended for everyone from those beginning their first job to those nearing retirement.

Investment options

The main product offered by Netwealth is the Super Accelerator, which gives members access to two main investment options: Super Accelerator Core and Super Accelerator Plus.

• Super Accelerator Core features term deposits and Netwealth Global Specialist Funds.
• Super Accelerator Plus offers the same investments as in the Core, but opens up your options to investing in ASX-listed shares, international shares and managed funds.

Depending on the product you choose, Netwealth offers you a wide range of investment options including:

• ASX-listed securities including ETFs, AREITS, company shares, listed investment companies and warrants.
• International securities listed on international exchanges including NYSE, NASDAQ, LSE, TSE, Deutsche Boerse and HKE.
• Managed accounts include professionally managed multi-sector, diversified and international equity fund portfolios for investing online.
• Wholesale managed funds counting more than 300 in a variety of investment categories and asset classes. You get to choose from among passive or index managers including those like BlackRock and Vanguard, and active fund managers including Magellan and USB.
• Netwealth GSS Specialist funds and models.

Fees

Netwealth members have to pay various fees for the management of super savings. These include (but are not limited to) the following:

• No investment fees for the Super Accelerator product. But there may be some investment fees for various types of investments within the product, such as for managed funds.
• Administration fees. The cost will depend on the account balance and investment options chosen. There are different rates on Core and Plus options.
  • Super Accelerator Core: A minimum fee ($120) per calendar year and 0.35% per year of your account balance for balances up to $250,000 which is calculated daily and deducted monthly.
  • Super Accelerator Plus: Account fee (of at least $550) with a $240 fixed element and an annual percentage-based fee that depends on your account balance:

There is no fee for the part of your account balance over $2.5 million.

It is possible to negotiate the size of your administration fee and a family fee rebate may apply.

Additional administration fees may apply to international securities investments.

• Brokerage, transaction and other fees. These depend on the inclusion of certain asset classes like international securities and ASX-listed securities.
• Insurance fees for those who have insurance cover through super. The cost will depend on the level and amount of cover, your age and the type of work you are engaged in.
  • Group policies have a percentage-based policy administration fee (8.125%), calculated on the base annual premium.
  • A $5 monthly administration fee applies to individual policies.

As the above fees are subject to change, be sure to check Netwealth’s product disclosure statement (PDS), other relevant documents and the website for details at time of finalising your transaction. You may also get advice from Netwealth consultants to clarify matters and details.

Pros and Cons

Free research account

Netwealth's free research account gives you access to:

• ASX pricing, data and charting
• ASX watchlists and alerts
• A daily round-up of news on business, market and finance
• Managed fund profiles together with research and tools for comparison
• Investment articles and videos

You can register for a free research account by entering your first name, last name and email address, and selecting the Free research account option and clicking Start. You can also use the Freecall number or email for service support.

How to open a Netwealth account

After comparing options, but before committing to a fund, be sure to read the Netwealth product disclosure statement (PDS). This would help you make the decision on whether a particular product is right for you.

You can join Netwealth super either by filling out an online registration or by speaking with a consultant.

Here are the steps common to both methods of registration:

• You will be asked for personal details including your name, date of birth and contact information.
• Inform your employer that you will be joining Netwealth.
• Your employer should provide you with a Superannuation standard choice form. Complete and sign the form, and return it to your employer.
• Expect to wait about three days for the account to open.

Comparing super funds before signing up is always a good idea. What should you look for? It is possible to compare super funds by their returns, fees and the insurance coverage they offer. Your goal should be to balance all these factors to find the right fit for you.

Alternatives

Here are some alternative superannuation funds to consider:

• Sunsuper, a balanced super fund that aims to help you manage your nest egg from the first day of work to retirement and beyond. May offer a retirement bonus to those eligible for one.
• UniSuper is an industry superfund and one of Australia's largest. It lets you choose from a variety of investments in a mix of asset classes together with optional insurance offerings that you can pick according to your needs.
• AustralianSuper is the largest super fund in Australia. It invests in a balanced mix of assets including shares, property and cash.
• Australian Ethical is certified by the Responsible Investment Association Australasia and invests in renewable energy, innovative technologies and sustainable products. It avoids coal, oil, tobacco and live animal export industries.
• QSuper offers you the benefits of tailored investment strategies based on your age and your account balance.

FAQs

What type of super fund is Netwealth?

There are different types of superfunds. These include corporate funds, industry funds, public sector funds, retail funds and self-managed superannuation funds (SMSF). Netwealth falls into the retail fund category and is a public offer retail fund.

Are my investments with Netwealth CHESS sponsored?

CHESS is an acronym for Clearing House Electronic Subregister System. CHESS is the computer system that the ASX uses to record and manage the settlement of share transactions. ‘CHESS sponsored’ simply means that the ASX knows who owns what shares and that your shares are owned by you directly, instead of someone else holding them on your behalf. When that happens, you get the dividends directly as well.

Shares are not CHESS sponsored when another party — such as an online broking platform or other custodian — holds shares on your behalf. Some brokers use the custodian model while others are CHESS sponsored. Netwealth works with both types.

To be CHESS participant sponsored you must enter into a sponsorship agreement with Netwealth. Only shares that are held in your name and registered identically to your account can be included in your CHESS sponsored holdings.

Can I consolidate my super with Netwealth?

You can consolidate your super from other funds and rollover to a Netwealth account. To do so, complete the Rollover/transfer request form on the fund’s website and send it to Netwealth. Remember that when you consolidate or rollover super, you have to forgo the insurance or other benefits you enjoyed with the existing super account.

Does Netwealth have an ethical investment option?

When you opt for the Super Accelerator Plus investment option, Netwealth allows for investment in “a selection of ethically responsible investments''. This means products from fund managers that consider ESG — environmental, social and governance — factors when making investment decisions. This option also enables you to avoid managed funds and ETFs that invest in alcohol, fossil fuel, gambling and tobacco industries. The best approach is to speak to a Netwealth consultant to learn more about their ethical investment options and their performance data.

What insurance options does Netwealth offer?

Netwealth offers group life insurance, total and permanent disability (TPD) cover, and income protection (IP) insurance. You can have TPD and IP tailored to your circumstances.

Make sure that you check the cover amounts, exclusions, limitations and other conditions that apply. Before making a decision, you must also check the premiums you'd have to pay for the insurance coverage and how comprehensive their reporting is.

What other services does Netwealth offer on their super?

• Free research account and tools.
• Access to financial advice including options for personal financial planning and retirement planning.
• Comprehensive reporting on your investment.
• The ability to access your account via PC, mobile or tablet.
• Ease of making additional investments.
• Member education - includes daily business news, fund comparisons, investor webinars and other resources.
• Investment research tools with research data on local markets.

Verdict

Your super is your money, your nest egg, your savings and investments for the future. Take the time to research your options well, taking into account super returns in recent years, management costs, insurance cover, and other services and conveniences before choosing a super fund, or changing or rolling over the existing one to a new one. A qualified advisor might be able to help you reach a more informed decision.