ESSENTIAL SUPER - COMMBANK
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Essential
Super
Reference Guide
THORISATION
AU I
R
DE
PE
NT
MYSU
MySuper
IFIER
56
60 09
19 2 5 4 3 5 9
Issue No 2018/1, dated 17 March 2018
Investments in Essential Super are offered from Commonwealth
Essential Super ABN 56 601 925 435 by Colonial First State
Investments Limited ABN 98 002 348 352 AFS Licence
23246856601925435909MYSUPERContents The information in this document forms part of the
Essential Super Product Disclosure Statement (PDS)
1 About this Reference Guide 1
dated 17 March 2018.
2 Using your account 2 A reference to ‘the PDS’ in this Reference Guide is a
reference to the PDS and all statements and
3 Tracking your super 8 information incorporated by reference as described in
the Essential Super PDS.
4 Risks of super 9
This Reference Guide will be updated from time to
5 How we invest your money 12 time. You should always ensure that you are reading
the most up-to-date version, together with the PDS,
6 Fees and costs 25 before making a decision to invest.
7 How super is taxed 32 The information contained in the PDS is general
information only and does not take into account your
8 Insurance in your super 43 individual objectives, taxation or financial situation or
needs. You should read the PDS carefully and assess
9 Important information for employers 54 whether the information is appropriate for you.
10 Other things you should know 61 Information contained in this PDS is subject to change
from time to time. Where a change to this information
is not materially adverse, the information may be
The name and contact details of the trustee updated via our website and can be found at any time
by visiting commbank.com.au/essentialinfo A paper
Colonial First State Investments Limited
copy of any updated information is available free of
11 Harbour Street, Sydney NSW 2000
charge on request by contacting us on 13 4074. Where
Telephone 13 4074
a change is material, the trustee will notify you in
Email contactessentialsuper@cba.com.au
writing within the timeframes provided for in the
relevant legislation.
Colonial First State Investments Limited ABN 98 002 Taxation considerations are general and based on
348 352 AFS Licence 232468 (Colonial First State) is present taxation laws, rulings and their interpretation
the trustee and administrator of Commonwealth as at 17 March 2018. You should seek professional tax
Essential Super ABN 56 601 925 435 (the fund) and advice on your situation before making any decision
the issuer of interests in Essential Super, which is a based on this information.
product of the fund. Colonial First State is a wholly Colonial First State is also not a registered tax
owned subsidiary of Commonwealth Bank of Australia (financial) adviser under the Tax Agent Services Act
ABN 48 123 123 124 AFS Licence 234945 (the Bank). 2009, and you should seek tax advice from a registered
The Bank and its subsidiaries do not guarantee the tax agent or a registered tax (financial) adviser if you
performance of Essential Super or the repayment of intend to rely on this information to satisfy the
capital by Essential Super. An investment in Essential liabilities or obligations or claim entitlements that arise,
Super is through a superannuation trust and is subject or could arise, under a taxation law.
to superannuation rules. It is not an investment in, Insurance for Essential Super is provided by
deposit with, or other liability of the Bank or its The Colonial Mutual Life Assurance Society
subsidiaries. An investment in Essential Super is subject Limited (the insurer) ABN 12 004 021 809 AFS
to investment risk, including loss of income and capital Licence 235035.
invested. The Bank provides distribution and
administrative services to the trustee.
24652/FS5342/03181 About this Reference Guide
This Reference Guide is packed with essential information about your super account
– how it works, how to invest and how to keep track of your super. Read this guide
together with the Product Disclosure Statement to get the full picture.
In this guide, you’ll find information on: Read the Product Disclosure
Using your account: how to manage your Statement
account and grow your super by making This guide is intended to be read along with the
extra contributions. Essential Super Product Disclosure Statement
Tracking your super: how we keep you (PDS) and the Essential Super Application Form
informed, so you can make sure your – on its own, it doesn’t cover everything you need
super stays on track. to know. To get the full picture, you need to read
Risks of super: important risks you need both of these documents.
to understand before you invest.
This Reference Guide will be updated from time
How we invest your money: essential to time, so make sure you have the most
information about your investment up-to-date version, as well as the most recent
options. PDS, before making a decision to invest.
Fees and costs: what you may need
to pay, depending on the options you
choose.
How super is taxed: an overview of the
tax rules that could affect your super.
Insurance in your super: more about the
insurance cover you’ll have as an
Essential Super member.
Other things you should know: our
privacy policy, terms and conditions, and
other important information.
12 Using your account
With easy online access through NetBank, it’s never been easier to make
contributions and watch your super grow.
How to use your account
Whether you’re rolling over super from another fund, switching options or making a
withdrawal, Essential Super makes it easy, with 24-hour online access through NetBank.
Here’s a quick guide to using your account. For further information on how your
transactions are processed, please refer to page 6.
Online netbank.com.au via our a secure online system (e-Post)
EFT or direct Telephone and internet banking –
credit and
Contact your bank or financial institution to make this payment from your
cheque, savings, debit or transaction account. More info: www.bpay.com.au
The table below provides you with information on how to transact on your account and
the options available to you.
If you’d like to Your options How it works Things you need to know
Roll over super NetBank Log on to NetBank to download
from another and complete a Request to
fund Transfer form, then mail us your
Phone completed form or upload it via
e-Post. Alternatively, call us with
details of your other super funds
and we can help you consolidate
over the phone.
Instruct your NetBank Log on to NetBank to download This form contains all the
employer to pay and complete the Super Choice information an employer requires to
contributions form, and then provide this to contribute to the fund.
into your your employer.
Essential Super
account
2If you’d like to Your options How it works Things you need to know
Make a EFT or direct Log on to NetBank or contact No minimum amount applies.
contribution credit your financial institution to Please note: If we do not receive any
transfer your contribution to: deposits into your account, after 24
BSB: 067-979 months, the account will
Account number: Your Essential be closed.
Super account number You’ll need to provide your Tax File
Account name: Your first name Number (TFN) to make personal
and surname contributions or for your spouse to
Reference codes make spouse contributions on your
Use one of these two-letter behalf. See the PDS for more about
reference codes to tell us what your TFN.
kind of contribution you’re We’ll accept contributions as
making: described in the current PDS (which
Personal contributions: MV you can ask us for, free of charge),
Spouse contributions: SP unless an option is suspended,
If you don’t enter a code, or you restricted or unavailable.
put it in the wrong place, we’ll In extraordinary circumstances,
treat your payment as a Super where an option is suspended,
Guarantee contribution. This restricted or unavailable, we might
means that contributions tax will not be able to process your
be deducted from additional investments or there may
your contribution. be a significant delay.
We also have the right to put your
Log on to NetBank or contact additional investment in another
your financial institution to make option. But, of course, we’ll let you
a payment: know if we do this.
Biller codes: If you are making a personal
Personal: 989756 contribution and want to claim a
Spouse: 989772 personal tax deduction, you must
Reference number: Account send us a Notice of Intent to Claim
number a Tax Deduction form. Download a
copy from NetBank
or www.ato.gov.au
Unfortunately, we’re unable to
accept over-the-counter
branch deposits.
® Registered to BPAY Pty Ltd ABN 69 079 137 518.
3If you’d like to Your options How it works Things you need to know
Switch between NetBank Log on to NetBank or call us Please check the current PDS for
options Phone on 13 4074 to make a switch. more information about your
investment options before making
a switch.
There’s no minimum amount that
you can switch.
We’ll process any requests to switch
options received on a NSW business
day before 3pm (Sydney time)
at that day’s unit price.
In extraordinary circumstances,
where an option is suspended,
restricted or unavailable, we might
not be able to process your switch
or there may be a significant delay.
We also have the right not to accept
your request to switch options.
But, of course, we’ll let you know if
we choose a different
investment option.
Make a Phone Call us on 13 4074. You may also There is no minimum amount, but
withdrawal need to complete a withdrawal to take money out of your Essential
form and upload it via e-Post. Super account, you must meet a
condition of release as outlined
in section 7.
We can pay your withdrawals by
cheque or to your nominated
bank account.
We’ll process any requests to
withdraw money received on a NSW
business day before 3pm (Sydney
time) at that day’s unit price. We’ll
usually pay them within seven
working days.
If your fully completed transaction
request is to roll over funds to
another institution, it will generally
be processed within three
working days.
In extraordinary circumstances, we
may suspend withdrawals. See
page 7 for further details.
Update your NetBank Log on to NetBank, call Some changes need a signed written
personal details Phone 13 4074 or visit your nearest request, and some certified documents
In person Commonwealth Bank branch. such as a driver’s licence and
birth certificate.
4If you’d like to Your options How it works Things you need to know
Nominate a NetBank Download a Non-lapsing Death We may need personal identification
person to Mail Benefit Nomination form or call for the person you nominate. In some
receive your us on 13 4074, then mail us your circumstances, we may delay or be
benefits if completed form or upload it unable to make a payment to the
you die via e-Post. person you nominate.
For further information on super and
death benefits, please see page 39.
Cancel a NetBank To cancel a contribution, We may need a signed written
request withdrawal or switch request, confirmation of the cancellation.
contact us before the cut-off time
shown on page 7 on the day
we receive the request you’d like
to cancel.
adjusting for any liabilities
A member can only have one dividing this amount by the total number
account in the Fund of units that members hold that day.
You are only permitted to have one
The number of units you have in each
account in Essential Super and the insurer
option will stay the same, unless there’s a
will only pay one benefit, even if you are
deposit to or withdrawal from your
paying premiums on more than one
account. However, the unit price will
account. If we identify that you have more
change if the market value of the
than one account, we will consolidate your
investment portfolio, or the total number
accounts into one. Generally, we will do
of units issued for the option change.
this by transferring the balance of the
newest account into the oldest account. We will work out each option’s market
If we merge your accounts, you will be value based on the most up-to-date
provided with at least 30 days notice information that we have. We may exercise
and we will confirm the transaction certain discretions that could affect the
once complete. unit price for that option.
Transactions and unit pricing The difference between entry and exit
unit prices
Calculating unit prices
An option’s entry and exit unit price may
When you invest in super, you receive a differ, depending on the option’s buy/sell
number of units for each option you invest spread of the option.
in. Each unit represents an equal part of
So that existing members don’t have to
the value of the portfolio of the option.
continually pay transaction costs resulting
Each of these parts has a dollar value, or a
from transactions that you make, all
unit price.
members pay a set, average amount
We work out a unit price each day by: whenever they deposit or withdraw money
taking the total market value of all the in an option. This is called a buy/sell
assets of the option spread. We calculate this amount
depending on the types of investments the
option holds.
5Not all new investments or withdrawals Processing your transactions
have transaction costs – for instance,
sometimes a new investment happens at Applications
the same time as someone else makes a When we receive your completed
withdrawal. However, to be consistent, we application, we’ll divide your investment
usually charge transaction costs to all the amount by the entry unit price for that
new investments and withdrawals from date. If we receive your application before
an option. 3pm (Sydney time) on a NSW business
day, we’ll use the unit price for that day.
Find out more
Those arriving after that time will be
You can find out more about the costs of buy/sell processed using the following business
spreads by checking the 'Buy/sell spreads' section day’s entry unit price.
on page 29.
If you send us your money by EFT or direct
Unit pricing adjustment policy credit, or as a transfer from another
Calculating unit prices can be complex as financial institution, we’ll use the unit price
there are many factors involved. for the date that your money arrives in our
These include: bank account.
asset valuations In extraordinary circumstances, we may
liabilities suspend or restrict applications. We also
have the right to reject applications. If we
debtors
receive an application for a suspended,
the number of units issued
restricted or unavailable option, we’ll invest
transaction costs. your funds into the Lifestage option and
If we find out that any of these factors are send you a confirmation notice letting you
wrong, we correct the unit price. We know how your money has been invested.
generally use a variance of 0.30% (0.05% If we are unable to proceed with your
for a cash investment option) in the unit application because we have not received
price before correcting it. If a unit pricing all the required information, or for any
error is greater than or equal to these other reason, we will:
variances, we will: attempt to contact you, and
pay the difference to your account hold your application monies in a trust
balance if you have transacted on an account until we receive the required
incorrect price, or information. Any interest on these
send you a payment for a correction monies may be retained by us.
of over $20 (if you have closed
your account). Funds are held for a maximum period of
30 days commencing on the day we
These levels meet regulatory practice receive the funds. After this period, your
guidelines and industry standards. In some application monies will be returned to the
cases, we may pay you even if the unit source of payment. At the time we process
pricing error is less than these levels. your application, your original application
monies will be divided by the applicable
unit price, to determine the number of
units to be issued to you.
6Switches the exit unit price at the time we
If you decide to switch options, we’ll treat receive your completed withdrawal request
it as a withdrawal from one option and an and proof of identity in line with our
investment into another. The money will transaction cut-off times below. In
leave one option at the exit unit price and extraordinary circumstances, we may
be invested in the other at the entry unit suspend withdrawals.
price. We’ll complete these two If an option is suspended, restricted or
transactions on the same business day, unavailable, we might not process
unless your switch is from or into a withdrawal requests, depending on the
suspended, restricted or unavailable best interests of all our members. If we do
option. In this case, we may not be able to make a payment, we’ll use the exit price
process your switch. If we do make a switch at the time we make the payment.
later, the exit price used will be the one at
Transaction processing, cut-off times
the time the switch is made.
and unit prices
If you wish to switch into a suspended,
We calculate unit prices each NSW
restricted or unavailable option, we’ll invest
business day. If we receive your completed
your funds into the Lifestage option and
investment, switch or withdrawal request
send you a confirmation notice letting you
in our office by 3pm (Sydney time) on a
know how your money has been invested.
NSW business day, we’ll process it that day
When switching, make sure you have a and use the next determined unit price.
copy of the current PDS, which you should
If we receive your completed transaction
keep for future reference.
request after the cut-off time shown above,
Withdrawals we’ll process your transaction on the
Withdrawals are complex and can affect following NSW business day. Keep in mind
your tax. If you need help understanding that we work out the next unit price for any
any of the terms used in this section, NSW business day at the close of trading
please call us or talk about it with your of all markets on that day. This means the
financial or tax adviser. price isn’t actually available until the
following business day.
We’ll only be able to process withdrawals
once we’ve cleared your application If your fully completed transaction request
money, and received all the documents we is to roll over funds to another institution,
need from you. it will generally be processed within three
working days.
Here’s what will happen if you don’t give
us all the information we need: Please note: If you ask us for a unit price
or what your investment is worth, we can
If you don’t select a payment method, only give you an historical amount, as
we’ll send you a cheque. these amounts change each day.
If you don’t choose an investment option
Even if you complete a valid transaction
for withdrawal, we’ll redeem in line with
request, there may be reasonable
your existing investment weightings.
circumstances which prevent us from
We can only make payments to
processing the request or cause a delay
Australian financial institutions. If you are
in processing the request. If a transaction
overseas, we’ll send you a cheque in
is delayed, you will receive the unit price
Australian dollars instead.
that applies on the day your request
We’ll calculate your amount based on is processed.
73 Tracking your super
With regular updates and 24-hour online access, it’s easy to make sure your super
stays on track.
Keeping you up to date Getting the latest information
about your account
We’ll make sure you always know where
your investment stands, by contacting you Online
with regular updates through NetBank. You can use NetBank to:
Simply go to netbank.com.au and log on
check your account balance and
to your account using your NetBank client
transaction history and any important
number and password. When you do, you’ll
notices or information we have sent you
see your Essential Super account right next
to your other accounts and your NetBank make additional investments
inbox at the top of the page. make changes to your investment option
send us scanned forms or documents
NetBank inbox via e-Post
Here you can see: update some of your personal details
when a transaction or change has been made view tax information (if applicable)
to your account make changes to your insurance
when you need to take action on your account submit your work test declaration.
tips on how to make the most of your super.
It is important that you check your NetBank Telephone
inbox regularly. Call 13 4074 to speak to a
Annual reports representative Monday to Friday,
8am to 7pm (Sydney time).
We'll publish our annual report by 31
December each year Email
on commbank.com.au/essentialinfo Contact us at
It will outline the fund's financial contactessentialsuper@cba.com.au
position and performance over the last For security and privacy reasons, we will
financial year. not send account specific information via
We can also email or post you a copy free email or accept changes to your details
of charge, simply call us on 13 4074. via email.
Find out more
You can find out more about our current
investment options, their performance and
historical unit prices by visiting
commbank.com.au/essentialinfo
or calling 13 4074 for the cost of a local call
within Australia.
84 Risks of super
Like any investment, super has its risks. This section outlines the main risks you
should know about before you invest.
Counterparty risk
General risks for all options In an investment transaction such as a
No matter what investment option you’ve swap or foreign currency forward, there’s
chosen, they all contain some risks. These a risk that the other party won’t do what it
risks include: promised. For example, they may not fulfil
Market risk their part in a financial contract.
All investments are influenced by the way Legal, regulatory and foreign
the market as a whole performs. So if investment risk
interest rates, investor sentiment or global Any change in taxation, corporate or other
events vary, your investment returns could laws, regulations or rules could have a
change too, depending on: negative effect on your investment. Your
the markets or asset classes you investment could also be negatively
invest in affected by economic, social or political
changes, regulatory change and legal risks.
the timeframe you’re investing for.
This is especially true for funds investing
Security and investment-specific risk in assets outside Australia.
Each asset class – for example, shares, Environmental, social and governance
fixed interest or property securities – has (ESG) and climate risk
its own specific risks, as do the investment The value of individual securities may be
options in our PDS. For example, there’s a influenced by environmental, social and
risk your shares could be affected if the governance factors. These factors include
company’s management changes, or its the potential impact that climate change
profits fall. These risks can also impact on and global warming may have on the
a company’s ability to repay its debt. valuation of a security. For example, a
Management risk company’s revenue may be reduced due
Each investment option (listed in our PDS) to weather events and this may then
has its own investment manager. reduce the value of the company’s shares.
There is a risk that they will not perform
as expected.
Liquidity risk
Liquidity simply means how quickly you
can sell an asset for cash, without having
a negative impact on its price. For example,
shares in large listed companies are
generally considered liquid. However, in
difficult market conditions, some normally
liquid assets may become illiquid. This
makes it hard for us to sell them and can
delay us making withdrawal payments, or
switching your investment option if you
ask us to.
9Option-specific risks Deciding your investment
Here’s an outline of risks for the timeframe
investment options offered to you by Different investments suit different
Essential Super. The risk table on page timeframes. For example,
11 shows you the specific risks for if you’re nearing retirement and you mainly
each option. want to protect the super you’ve saved,
Currency risk then you might be best choosing a secure,
Any option that invests in global markets cash-based investment. But if you want to
or owns securities that are expressed in increase your investment’s value over a
foreign currencies is exposed to foreign longer time, you’ll probably include growth
currency risk. This means that its value in assets like shares and property as part of
Australian dollars varies when the your investment portfolio.
exchange rate changes. We have suggested minimum investment
The investment options in the PDS with timeframes, and outlined the standard risk
significant currency risks have different measures each particular investment could
ways of managing currency risks. For face. However, this isn’t meant to be
example, they may use currency hedging, personal advice. You should regularly check
which reduces or removes the impact your investment decision and think
of currency movements on the about changing it if your investment needs
investment’s value. and market conditions change.
For more about each option’s currency Take note
management strategy, see section 5.
All of the investment options in the PDS are
Different options have different currency subject to some or all of these risks, which can
management strategies. also vary.
Credit risk
Sometimes, one of the parties in a credit
transaction may not follow through with
its obligations. For example, it might Your investment option risk
default under a mortgage-backed security profile
or a fixed interest security. This exposes
investors to the security’s underlying We’ve outlined the main risks of our
borrowers and the financial situation of the investment options in the general risks of
issuers of these securities. investing section and the PDS, which are:
market risk
Other risks you should know
security and investment-specific risk
about management risk
Whenever you invest, there’s a risk that liquidity risk
your investment goals will not be met. counterparty risk
We’ve already outlined some of the risks legal, regulatory and foreign
that can affect your investment. You should investment risk
also look at your investment strategy and
environmental, social and governance
make sure it’s in line with your investment
(ESG) risk and climate risk.
objectives. If it isn’t, there’s a risk you may
not meet your investment goals.
10There are also some option-specific risks.
Here’s a table listing the Essential Super
investment options that typically have
exposure to these option-specific risks. The
table doesn’t include every risk, and should
only be used as a guide. Also, the risks may
not always apply to each option, and the
importance of the risk may differ from the
table below and change at times. Options
can also become exposed to an
option-specific risk at a later date, so the
table may not include them.
Option name Currency risk Credit risk
1940s Lifestage
1950s Lifestage
1960s Lifestage
1970s Lifestage
1980s Lifestage
1990s Lifestage
2000s Lifestage
Balanced
Australian Share
Cash Deposit
115 How we invest your money
Whether you’re just starting your career or about to retire, you’ll find an Essential
Super investment option that’s designed for your age group.
Our Lifestage option has been designed to give an investment mix for your age group
and the time left until you retire. Best of all, we do the hard work for you, by automatically
choosing the option for your age group, then adjusting your investment mix as you
grow older.
Or if you prefer, you can choose from three other options: Balanced, Australian
Share and Cash Deposit options or a combination of the Lifestage option and these
three options.
Understanding our investment options
This section has detailed information about each of our investment options. Here’s an
example of how they’re presented, with an explanation of what each section means.
Investment option name Objective
Name of the investment. The option’s overall objective and the period
Investment option profiles
in which the manager aims to achieve it.
MySuper product – Lifestage
option Allocation
1940s Lifestage option1 The mix of different
investments your money
Description Description Objective Allocation is invested in – for example,
If you were born in the To achieve a return of shares, property securities,
The type of investor that 1940s, then this option is Consumer Price Index (CPI)
30% ■ Cash fixed interest and cash.
intended to be suitable for plus 1.0% pa over rolling
this option is intended to you. As you’re approaching three-year periods after
30% ■ Fixed interest
8% ■ Global property and The asset allocation for
be suitable for. retirement, you want your fees and taxes. infrastructure securities
16% ■ Australian shares each option may change
super to be protected from
large short-term losses. The
16% ■ Global shares
from time to time. The
option invests in a high benchmark allocation
percentage of defensive simply means how much
assets such as cash
deposits and fixed interest, of each asset class the fund
but also includes some manager aims to hold.
growth assets such
Minimum suggested as shares.
timeframe
Minimum suggested Strategy Strategy
Investment professionals timeframe To invest in a diversified
have different opinions
At least 3 years portfolio of assets expected The overall strategy of the
to generate a mix of
about the minimum amount Risk income and long-term
investment option and how
money within the option
345
of time you should hold capital growth with an
varying investments. Your ME
DIUM emphasis on stable is invested.
returns. The portfolio aims
67
1 2
own personal circumstances
HIGH
LOW
to hedge currency risk,
will also affect your decision. except for part of the
allocation to global shares.
So we’ve suggested minimum
investment timeframes
for each option. However,
these suggestions aren’t
meant to be personal advice. Risk (Standard Risk Measure)
You should review your
investment decision, because We’ve used the Standard Risk Measure (SRM), objectives. It also doesn’t take into account the
your investment needs and based on industry guidance. You can use it to impact of administration fees and tax on the
market conditions may help you compare investment options that are likelihood of a negative return. So you should
change over time. expected to deliver a similar number of negative make sure you are comfortable with the risks
annual returns over any 20-year period. The and possible losses that you could have with the
SRM doesn’t completely assess every type of investment option you choose. The SRM isn’t
investment risk. For instance, it can’t predict the meant to be personal advice. More detail on risks
1 Assetofallocations
size as at 17 return
a negative March 2018.
orAswhether
we actively manage
your the asset allocation, the
positive asset allocation
which may affectof an your investment is included in
individual
return Lifestage
will optionthan
be less may vary
youoverneed
time. to meet your the ‘Risks of super’ section in the PDS.
17
12How is Essential Super Investment options and
structured? borrowing
When contributions are invested in Your option will only borrow money if it is
Essential Super, money is combined with part of its investment strategy, and then,
other members’ money. it will only borrow:
Each Essential Super investment option is for short-term arrangements for
a separate investment option within this settlement purposes
superannuation fund. Each investment in an emergency
option invests in an underlying ‘pool’ which if there’s an extraordinary situation.
is managed according to the investment
option’s objectives. Your investment and labour
We are the responsible entity for the standards or environmental
underlying pools, which are managed by social or ethical considerations
each investment manager through a
As the trustee, we don’t specifically take
mandate arrangement. The Cash Deposit
into account labour standards or
option and other cash allocations are
environmental, social or ethical
deposited with Commonwealth Bank
considerations of our investments.
of Australia.
However, if we think any of these factors
Risk measure categories will negatively affect the investment
Here are the risk bands we use to classify performance or a company’s stability,
our investment options: we may:
discuss these matters with the
Risk Risk label Estimated number company’s management
band of negative annual think about whether we want to keep
returns over any this investment.
20-year period
We’ll make these reviews on a case-by-case
1 Very low Less than 0.5
basis when necessary. We don’t use any
2 Low 0.5 to less than 1 specific process, or have any set views
3 Low to 1 to less than 2 about how far we’ll take factors into
medium account in a review.
4 Medium 2 to less than 3 Types of investments
5 Medium to 3 to less than 4 Our trust deed gives us a great deal of
high freedom about the investments that each
option can hold. You can find out what
6 High 4 to less than 6 investments we plan to hold by checking
7 Very high 6 or greater the strategy of the option you’re interested
in. If we decide to change any of those
investment strategies, we’ll let you know
as soon as is practical.
13The Commonwealth Bank, our parent The trustee pays the Commonwealth Bank
company, is listed on the Australian to provide banking and treasury-related
Securities Exchange. The Australian services to all the investment options. The
Securities and Investments Commission trustee may also receive financial and
(ASIC) allows our investment options administrative benefits because we hold
to hold shares in the Commonwealth Bank bank accounts with the Commonwealth
as long as: Bank and administer some of its
this holding is not voted for financial products.
the total holdings for all entities in the Outsourcing an option's
Commonwealth Bank are not more investment management
than 5% of the Bank's issued capital.
Sometimes, we may outsource or delegate
Any other benefits to an investment option to a related entity or
Commonwealth Bank an outside company to manage. If we do,
we have processes in place to make sure
Some stockbrokers may pay us to use our we choose the highest quality managers.
third party research and financial markets
data, or other research and execution
services set out in the relevant Financial
Services Council (FSC) Guidance. Note:
We’ll monitor these kinds of payments to
make sure they’re appropriate and in the
best interests of our investors. If you want
to know more, just ask us for a copy of our
policy on accepting payments.
14The main asset classes
Cash Fixed Interest Property1 Infrastructure2 Shares
345 DIUM
345 DIUM
345 DIUM
345 DIUM
345 DIUM
ME ME ME ME ME
67
67
67
67
67
1 2
1 2
1 2
1 2
1 2
HIGH
HIGH
HIGH
HIGH
HIGH
LOW
LOW
LOW
LOW
LOW
Cash investments Fixed interest Property generally Infrastructure refers If you invest in
are generally an securities, such as involves buying a to the physical assets shares, you are
investment in bonds, usually property directly or required for a buying part of a
bank bills or work like loans. investing in property business or country company. Shares are
similar securities. You pay cash for securities. Property to operate, including usually bought and
They usually have the bond. In return securities do not transportation, sold on a stock
a short you receive a involve buying a communication and exchange. They are
investment regular interest property directly. utilities (eg water, generally considered
timeframe. The payment from the Instead, they can sewage and to be more risky than
great thing about bond issuer, over provide an indirect electricity). It may the other asset
cash investments an agreed period exposure to property also include 'social classes because their
is they usually of time. The value and generally infrastructure' such value tends to go up
give you a stable of your bond can represent a part as prisons, hospitals and down more than
return. You're go up or down as ownership of a and public housing. other asset classes.
also less likely to interest rates company or an Infrastructure Historically, over the
lose your capital move. When the entitlement to the typically have; high longer term, shares
than with a bond matures, assets of a trust. The upfront capital have generally
higher growth you'll be repaid the company or trust requirements, low provided a higher
investment, money you loaned may hold, manage or ongoing operating return than the other
like shares. to the issuer in develop property in costs and relatively asset classes.
cash. Historically, sectors such as predictable cash
bonds have office, industrial and flows and
provided a more retail. Property operational risks.
consistent but securities are Infrastructure
lower return generally listed on a securities are
than shares. stock exchange and securities listed on a
are bought and sold stock exchange that
like shares. predominantly own
infrastructure assets.
1. If an option invests in property or property securities it is detailed in the strategy
or allocation of the option.
2. If an option invests in infrastructure or infrastructure securities it is detailed in the
strategy or allocation of the option.
15Investment option profiles
MySuper product – Lifestage
option
1940s Lifestage option1
Description Objective Allocation
If you were born in the To achieve a return of
1940s, then this option is Consumer Price Index (CPI)
30% ■ Cash
intended to be suitable for plus 1.0% pa over rolling 30% ■ Fixed interest
you. As you’re approaching three-year periods after 8% ■ Global property and
infrastructure securities
retirement, you want your fees and taxes. 16% ■ Australian shares
super to be protected from 16% ■ Global shares
large short-term losses. The Strategy
option invests in a high To invest in a diversified
percentage of defensive portfolio of assets expected
assets such as cash to generate a mix of
deposits and fixed interest, income and long-term
but also includes some capital growth with an
growth assets such emphasis on stable
as shares. returns. The portfolio aims
to hedge currency risk,
Minimum suggested except for part of the
timeframe allocation to global shares.
At least 3 years
Risk
345 DIUM
ME
67
1 2
HIGH
LOW
1 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
161950s Lifestage option2
Description Objective Allocation
If you were born in the To achieve a return of
1950s, then this option is Consumer Price Index (CPI)
30% ■ Cash
intended to be suitable for plus 1.0% pa over rolling 30% ■ Fixed interest
you. As you approach three-year periods after 8% ■ Global property and
infrastructure securities
retirement, it’s important fees and taxes. 16% ■ Australian shares
that your super is protected 16% ■ Global shares
from large short-term Strategy
losses. This option invests To invest in a diversified
in a high proportion of portfolio of assets expected
defensive assets such as to generate a mix of
cash deposits and fixed income and long-term
interest but also includes capital growth with an
some growth assets such emphasis on stability of
as shares and property to returns. Over time the
provide additional return. portfolio’s exposure to
assets with volatile returns
Minimum suggested will be reduced and the
timeframe investment objective will
At least 3 years change to reflect this. The
portfolio aims to hedge
Risk currency risk, except for
345
part of the allocation to
DIUM
global shares.
ME
67
1 2
HIGH
LOW
2 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
171960s Lifestage option3
Description Objective Allocation
If you were born in the To achieve a return of
1960s, then this option is Consumer Price Index (CPI)
16.6% ■ Cash
intended to be suitable for plus 2.0% pa over rolling 22.9% ■ Fixed interest
you. This option aims to six-year periods after fees 10.8% ■ Global property and
infrastructure securities
grow your super, by and taxes.
24.7% ■ Australian shares
investing in a mix of assets 25.0% ■ Global shares
including growth assets Strategy
such as shares and To invest in a diversified
property. It also includes portfolio of assets expected
more defensive assets such to generate a mix of
as cash and fixed long-term capital growth
interest investments. and income. Over time the
portfolio’s exposure to
Minimum suggested assets with volatile returns
timeframe will be reduced and the
At least 5 years investment objective will
change to reflect this. The
Risk portfolio aims to hedge
345
currency risk, except for
DIUM
part of the allocation to
ME
67
1 2
global shares.
HIGH
LOW
3 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
181970s Lifestage option4
Description Objective Allocation
If you were born in the To achieve a return of
1970s, then this option is Consumer Price Index (CPI)
5% ■ Cash
intended to be suitable for plus 2.5% pa over rolling 15% ■ Fixed interest
you. As you’re a long way seven-year periods after 14% ■ Global property and
infrastructure securities
from retirement, you can fees and taxes.
33% ■ Australian shares
stay invested through 33% ■ Global shares
market downturns with the Strategy
goal of increasing your To invest in a diversified
investment returns over portfolio of assets expected
the longer term. This to generate a mix of
option aims to grow your long-term capital growth
super, by investing in a and income, but which may
high percentage of growth be quite volatile in the
assets such as shares short to medium term.
and property. In the long term, the
It also includes more portfolio’s exposure to
defensive assets such as assets with volatile returns
cash and fixed interest will be reduced and the
investments. investment objective will
change to reflect this.
Minimum suggested The portfolio aims to hedge
timeframe currency risk, except for
At least 6 years part of the allocation to
global shares.
Risk
345 DIUM
ME
67
1 2
HIGH
LOW
4 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
191980s Lifestage option5
Description Objective Allocation
If you were born in the To achieve a return of
1980s, then this option is Consumer Price Index (CPI)
5% ■ Cash
intended to be suitable for plus 2.5% pa over rolling 15% ■ Fixed interest
you. As you’re a long way seven-year periods after 14% ■ Global property and
infrastructure securities
from retirement, you can fees and taxes.
33% ■ Australian shares
stay invested through 33% ■ Global shares
market downturns with the Strategy
goal of increasing your To invest in a diversified
investment returns over portfolio of assets expected
the longer term. This to generate a mix of
option aims to grow your long-term capital growth
super, by investing in a and income but which may
high percentage of growth be quite volatile in the
assets such as shares short to medium term.
and property. In the very long term, the
portfolio’s exposure to
Minimum suggested assets with volatile returns
timeframe will be reduced and the
At least 6 years investment objective will
change to reflect this.
Risk The portfolio aims to hedge
345
currency risk, except for
DIUM part of the allocation to
ME
67
1 2
global shares.
HIGH
LOW
5 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
201990s Lifestage option6
Description Objective Allocation
If you were born in the To achieve a return of
1990s, then this option is Consumer Price Index (CPI)
5% ■ Cash
intended to be suitable for plus 2.5% pa over rolling 15% ■ Fixed interest
you. Because you’ve got seven-year periods after 14% ■ Global property and
infrastructure securities
plenty of time before fees and taxes.
33% ■ Australian shares
retirement, you can stay 33% ■ Global shares
invested through market Strategy
downturns with the goal of To invest in a diversified
increasing your investment portfolio of assets expected
returns over the longer to generate a mix of
term. This option aims to long-term capital growth
grow your super, by and income but which may
investing in a high have a high level of short
percentage of growth to medium-term volatility.
assets such as shares In the very long term, the
and property. portfolio’s exposure to
assets with volatile returns
Minimum suggested will be reduced and the
timeframe investment objective will
At least 6 years change to reflect this.
The portfolio aims to hedge
Risk currency risk, except for
345
part of the allocation to
DIUM
global shares.
ME
67
1 2
HIGH
LOW
6 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
212000s Lifestage option7
Description Objective Allocation
If you were born in the To achieve a return of
2000s, then this option is Consumer Price Index (CPI)
5% ■ Cash
intended to be suitable for plus 2.5% pa over rolling 15% ■ Fixed interest
you. Because you’ve got seven-year periods after 14% ■ Global property and
infrastructure securities
plenty of time before fees and taxes.
33% ■ Australian shares
retirement, you can stay 33% ■ Global shares
invested through market Strategy
downturns with the goal of To invest in a diversified
increasing your investment portfolio of assets expected
returns over the longer to generate a mix of
term. This option aims to long-term capital growth
grow your super, by and income but which may
investing in a high have a high level of short
percentage of growth to medium-term volatility.
assets such as shares In the very long term, the
and property. portfolio’s exposure to
assets with volatile returns
Minimum suggested will be reduced and the
timeframe investment objective will
At least 6 years change to reflect this.
The portfolio aims to hedge
Risk currency risk, except for
345
part of the allocation to
DIUM
global shares.
ME
67
1 2
HIGH
LOW
7 Asset allocations as at 17 March 2018. As we actively manage the asset allocation, the asset allocation of an
individual Lifestage option may vary over time.
22Balanced option
Description Objective Allocation
This option is intended to To achieve a return of
be suitable for those who Consumer Price Index (CPI)
20% ■ Cash
are seeking returns from plus 1.5% pa over rolling 30% ■ Fixed interest
an investment spread five-year periods after fees 9% ■ Global property and
infrastructure securities
equally between growth and taxes.
20.5% ■ Australian shares
and defensive assets. 20.5% ■ Global shares
Strategy
Minimum suggested To invest 50% in a
timeframe diversified portfolio of
At least 4 years assets expected to
generate long-term capital
Risk growth such as shares,
345
property and infrastructure.
DIUM
50% of the portfolio is
ME
67
1 2
allocated to defensive
HIGH
LOW
assets such as fixed interest
and cash to provide the
portfolio with relatively
stable returns.
The portfolio aims to hedge
currency risk, except for
part of the allocation to
global shares.
Australian Share option
Description Objective Allocation
This option is intended to To closely track the
be suitable for those who S&P/ASX 200 0% Range 100% Benchmark
95–100% 100% Australian shares
are seeking higher returns Accumulation Index with 0–5% 0% Cash
and have a higher the aim of generating
tolerance for risk. returns (before tax and
fees and assuming income
is reinvested) comparable
to the Australian
sharemarket as measured
by that benchmark over
rolling one-year periods.
Minimum suggested Strategy
timeframe The option invests in
At least 7 years shares of Australian
companies. All shares in
Risk this option are maintained
345
within a very close margin
DIUM to their weight in the
ME
67
1 2
S&P/ASX 200
HIGH
LOW
Accumulation Index.
23Cash Deposit option
Description Objective Allocation
This option is intended to To achieve a positive
be suitable for those monthly return after fees 0% Range 100% Benchmark
100% 100% Cash
looking to invest in the and taxes.
security of a cash deposit
with the Commonwealth
Bank of Australia.
Minimum suggested Strategy
timeframe To invest in a
No minimum Commonwealth Bank of
Australia bank deposit
Risk product. Current interest
345
rates are available on
DIUM our website or by
ME
67
1 2
contacting us.
HIGH
LOW
We will notify existing members in affected
Changes to the investment portfolios of any material changes as soon
options as practicable. Any change would be
We manage and regularly monitor the considered in light of the potential
options. To ensure the ongoing quality of negative or positive impact on members.
the options, we are able to make changes Updated information on the options that
including: is not materially adverse can be obtained
actively managing the asset allocation, by calling us on 13 4074 or by visiting the
and this may result in the asset allocation investment options information on our
of an option differing from the website, commbank.com.au/essentialinfo
information provided A paper copy of the most recent details will
changing the investment objective be provided free of charge on request.
and/or investment strategy
changing the allocation or the number
of asset classes within the portfolio
adding, suspending, restricting, closing
or terminating an investment option
(including the MySuper product).
246 Fees and costs
Essential Super has competitive fees, with no hidden costs or added extras. But
while we’ve worked hard to keep costs down, there are still some fees you’ll need
to pay, depending on the options you choose.
This document shows the fees and costs that you may be charged. These fees and costs
may be deducted from your money, from the returns on your investment or from the
assets of the superannuation entity as a whole. Other fees, such as activity fees and
insurance fees, may also be charged, but these will depend on the nature of the activity
or insurance chosen by you.
Taxes, insurance fees and other costs relating to insurance are set out in sections 7 and
8 of this document.
You should read all the information about fees and other costs because it is important
to understand their impact on your investment.
Essential Super
Type of fee Amount8 How and when paid
Investment fee Lifestage option 0.40% pa The investment fee is reflected in
Balanced option 0.40% pa the daily unit price and is generally
Australian Share option 0.40% pa deducted from the assets of
Cash Deposit option 0.00% pa the investment option on a
monthly basis.
Administration fee Lifestage option 0.40% pa The administration fee of 0.40% pa
Balanced option 0.40% pa is reflected in the daily unit price
Australian Share option 0.40% pa and is deducted from the assets
Cash Deposit option 0.00% pa of the investment option on a
monthly basis.
The administration fee of $5.88 is
Plus $70.56 pa ($5.88 per payable each month by deduction of
month) units from the investment option.
Please note: The amount deducted
from your account will be $5 each
month, as we give you the benefit of
the tax deduction.
Buy/sell spread 0%–0.15% per transaction, depending on the This fee is payable each time you add
option. Please refer to page 29 for the buy/sell to, withdraw from or switch to/from
spreads of each option. an investment option.
Nil N/A
Switching fee9
Exit fee9 Nil N/A
8 All figures disclosed include the net effect of GST.
9 Even though switching fees and exit fees are not charged, buy/sell spreads apply to all options, except the
Cash Deposit option (refer to page 29 for further details).
25Type of fee Amount8 How and when paid
Advice fees relating Nil N/A
to all members
investing in a
particular MySuper
product or
investment option
Other fees and costs Insurance fee: Deducted monthly in advance from
Refer to page 45 for the insurance premiums your account.
that will be deducted, if you have insurance Please note: Insurance fees will apply
cover. Refer to page 31 for more detail on the to all insurance cover automatically
insurance administration fee that will apply if approved cover or cover you select).
you have insurance cover.
Indirect cost ratio Estimated to be: These costs are deducted from the
1940s Lifestage option 0.00% pa underlying assets of the option and
1950s Lifestage option 0.00% pa are reflected in the daily unit price
1960s Lifestage option 0.00% pa for that option. Depending on the
1970s Lifestage option 0.00% pa cost, they may be deducted daily
1980s Lifestage option 0.00% pa or monthly.
1990s Lifestage option 0.00% pa
2000s Lifestage option 0.00% pa
Balanced option 0.00% pa
Australian Share option 0.00% pa
Cash Deposit option 0.00% pa
8 All figures disclosed include the net effect of GST.
26Additional explanation of fees and costs
Changes to the fees
We can change the fees set out above at any time at our absolute discretion, without
your consent, within the limits prescribed in the trust deed. If the variation is an increase
in a fee or charge, we will give you at least 30 days prior written notice. This excludes
the cost components of fees which are estimates, as the actual costs charged may be
more or less than estimated.
The law and the trust deed allow us to charge reasonable fees for requests for information
relating to family law cases and the superannuation splitting provisions. At this time, we
have elected not to charge these fees; however, we reserve the right to charge them at
a later date.
Defined fees
Does this fee
Type of fee 10 Description apply?
Activity fee The fee relates to costs incurred by the trustee of the N/A
superannuation entity that are directly related to an activity of the
trustee (i) that is engaged in at the request, or with the consent,
of a member; or (ii) that relates to a member and is required by
law; and those costs are not otherwise charged as an administration
fee, an investment fee, a buy/sell spread, a switching fee, an exit
fee, an advice fee or an insurance fee.
Administration The fee relates to the administration or operation of the Yes – 0.40% pa
fee superannuation entity and includes costs that relate to that (except for the Cash
administration or operation, other than: Deposit option) plus
a borrowing costs; $5.88 per month
b indirect costs that are not paid out of the superannuation entity ($70.56 pa)11
that the trustee has elected in writing will be treated as indirect
costs and not fees, incurred by the trustee of the entity or in an
interposed vehicle or derivative financial product; and
c costs that are otherwise charged as an investment fee, a buy/sell
spread, a switching fee, an exit fee, an activity fee, an advice fee
or an insurance fee.
Advice fee The fee relates directly to costs incurred by the trustee of the N/A
superannuation entity because of the provision of financial product
advice to a member by (i) a trustee of the entity, or (ii) another
person acting as an employee of, or under an arrangement with,
the trustee of the entity; and those costs are not otherwise charged
as an administration fee, an investment fee, a switching fee, an
exit fee, an activity fee or an insurance fee.
10 These definitions can also be found at commbank.com.au/essentialinfo
11 Please note: The amount deducted from your account will be $5 per month, as we give you the benefit of
the tax deduction.
27Does this fee
Type of fee 10 Description apply?
Buy/sell spread A fee to recover transaction costs incurred by the trustee of the Yes – refer to page
superannuation entity in relation to the sale and purchase of assets 29 for details
of the entity.
Exit fee12 A fee to recover the costs of disposing of all or part of members’ N/A
interests in the superannuation entity.
Indirect cost ratio The indirect cost ratio (ICR) for a MySuper product or an investment Yes - refer to page
option offered by a superannuation entity, is the ratio of the total 30 for details
of the indirect costs for the product or investment option, to the
total average net assets of the superannuation entity attributed to
the MySuper product or investment option.
Please note: A fee deducted from a member’s account or paid out
of the superannuation entity is not included as an indirect cost.
Insurance fee The fee relates directly to either or both of the following: Yes – refer to page
(i) insurance premiums paid by the trustee of the superannuation 31 for details
entity in relation to a member or members of the entity, (ii) costs
incurred by the trustee of the superannuation entity in relation to
the provision of insurance for a member or members of the entity.
Investment fee The fee relates to the investment of the assets of a superannuation Yes – 0.40% pa
entity and includes: (except for the Cash
a fees in payment for the exercise of care and expertise in the Deposit option)
investment of those assets (including performance fees); and
b costs that relate to the investment of assets of the entity,
other than:
(i) borrowing costs; and
(ii) indirect costs that are not paid out of the superannuation
entity that the trustee has elected in writing will be treated
as indirect costs and not fees, incurred by the trustee of the
entity or the interposed vehicle or derivative financial
product; and
(iii) costs that are not otherwise charged as an administration
fee, a buy/sell spread, a switching fee, an exit fee, an activity
fee, an advice fee or an insurance fee.
Switching fee12 A switching fee for a MySuper product, is a fee to recover the costs N/A
of switching all or part of a member’s interest in the superannuation
entity from one class of beneficial interest in the entity
to another.
A switching fee for superannuation products other than a MySuper
product, is a fee to recover the costs of switching all or part of a
member’s interest in the superannuation entity from one
investment option or product in the entity to another.
10 These definitions can also be found at commbank.com.au/essentialinfo
12 Buy/sell spreads apply to all options, except the Cash Deposit option (refer to above for further details).
28You can also read
