PRETIREMENT PLANNING - QSuper...to get there. The Retirement Income Calculator on the QSuper website...

MARCH 2014

PeterQSuper member

since 1999

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important super

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WHAT’S

THE SCOOP?

PRETIREMENT PLANNING

GOING THE DISTANCE

Get retirement ready

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Advice can help your super last longer

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Discover our range of investment solutions in your 4-page guide

YOUR SUPERYOUR FUTUREYOUR CHOICE

2 Super Scoop March 2014

> FROM THE COVER Meet PeterI love hearing about members like Peter, who has made the smart move and consolidated his super with QSuper. It’s also very encouraging to hear that Peter understands how important it is to take control of his super, and is actively starting to consider the best investment strategy for his Accumulation account.

WelcomeLast year, our centenary year, was a significant one for QSuper. It allowed us to reflect on our one hundred year history of championing better retirement outcomes for Queenslanders, but more importantly it saw us introduce innovations that will build on our proud heritage and shape an even better financial future for our members.

Time for changeIt’s been a busy time for the super industry as a whole. But at QSuper we’re leading the change, and looking at how we can do things differently to really make a difference to the retirement outcomes for all our members.

Our industry-leading Lifetime investment option is designed to be responsive to the different needs of different members, and in the coming months we will be making this option even more comprehensive. More information is available in the enclosed Lifetime Important Notice, and I urge you to read it to see how these changes may affect you.

Investment choices – it’s your choiceOur Lifetime option is only part of the picture. As the state’s largest fund, we look after the super of around one in seven working Queenslanders. It’s a responsibility I personally take seriously having seen first hand what a struggle retirement can be without enough money. Helping ensure all our members can have financial dignitity in retirement is what motivates me and my team everyday.

That’s why we are extending the investment options we offer you. Whatever your needs or attitude to your super we’re likely to have a solution tailored to you. There’s a special four-page feature in the centre of this edition of Super Scoop that puts a spotlight on the investment options we offer you, including the exciting new investment option we’re launching later this year, QSuper Self Invest.

Your super, your wayIf you’re getting closer to retirement your super is probably becoming more of a priority. You may be seeking to

protect what you have accumulated over a lifetime, or you may be discovering that you don’t yet have enough to meet your retirement goals and are looking to boost your balance in the latter part of your working life.

Either way, if you don’t feel confident in making your own investment decisions you can feel secure knowing that we

are making the best possible decisions to secure more certainty around your retirement outcomes through QSuper Lifetime. And if you want to take a more active role, you can feel secure in the knowledge that we can offer you the an investment choice to meet your needs.

Rosemary Vilgan Chief Executive Officer, QSuper

A prestigious achievement

A message from QSuper’s CEO

“What’s important to me is finding the right solution to help all our members

have a better retirement.”

Rosemary Vilgan

On behalf of the QSuper Board, I would like to congratulate Rosemary on being named 2013 Telstra Australian Business Woman of the Year. This is a tremendous honour for Rosemary – who also received the Community and Government award, and was recognised at state level with the Business Innovation Award – as the fi nalist fi eld was comprised of some very impressive candidates.It is also a huge honour for the Fund, as the win is refl ective of the innovative and often industry-leading approach we

have taken as we look to create better retirement outcomes for all members through the introduction of QSuper Lifetime. These awards acknowledge how instrumental Rosemary has been in driving this vision, both for us as a fund and for the industry as a whole, and recognises her courage, vision and passion. As a member you can feel secure that your super is in the hands of a fund whose leader is truly committed to your future fi nancial security.

Karl MorrisChairman of the QSuper Board

A prestigiousachievement

Peter QSuper member

What we do now as a fund affects the future financial security of all our members.

3Super Scoop March 2014

As the financial decisions we’re expected to make grow more complex, an experienced adviser can be a reassuring presence. They can be a great sounding board if you want to talk over your options and make more informed decisions.

Make your retirement dreams realitySo, how could a financial adviser help you? For starters, they can help you work out if you’re on track for a comfortable retirement, and help you put strategies in place if the numbers aren’t quite adding up.

And it doesn’t have to be a big commitment. Many advisers can look at single topics, and often over the phone – taking just a few minutes of your time.

At the other end of the scale, many people also choose to take advantage of an ongoing review service. This allows you to review and revise your financial plan at regular intervals to make sure you’re staying the course.

Whatever you choose, a financial adviser will be happy to look at individual components of your situation – or all of it together. You’ve done a lot of the hard work in the run-up to retirement – now is the time to reap the rewards!

1 KPMG Econtech Value Proposition of Financial Advisory Networks, a report prepared for the Investment and Financial Services Association (now known as the Financial Services Council), 29 October 2009.

Get ahead, get advice.

By the time you reach your 50s and 60s, there’s one big question you really need to be asking: are you set for a comfortable retirement? You only get one shot at it, so it’s important to approach it properly.

In many respects, your 50s and 60s are the perfect time to review your financial situation. The kids have left home, the mortgage is more manageable, and your super has had many years to grow.

The challenge now is take this foundation and turn it into a secure and comfortable retirement, while there’s still plenty of time! That’s where good financial advice, tailored to your own circumstances, can come in handy.

A financial adviser could help you fine-tune your existing financial plan, or put a new one in place. Either way, you’ll have the chance to protect your lifestyle, and look ahead to the future with greater confidence.

Good for your money, good for your mindWhile some people are still reluctant to get financial advice, studies show that people who do are better off as a result,1 even after the cost of the advice is taken into account.

Common financial benefits include increased savings, better investment returns, faster debt reduction and less money paid in interest. Getting good advice can also be a stress reliever too.

What to look for in an adviserAs with any good partnership, trust is the key, and that’s never more true than when it comes to looking after your money and your financial future. You should always do your homework before choosing an adviser.

Word of mouth can be great (although always make sure the person doing the recommending isn’t being offered an incentive for their endorsement), but also never be afraid to ‘interview’ an adviser before committing yourself. The following questions are a great place to start:

Q What will this advice cost me?

Q What are your areas of expertise?

Q Are you licensed, and what services do you have a licence for?

Need advice? For quality financial

advice you can trust,

talk to a QInvest adviser. QInvest,

who are wholly owned by QSuper

Limited, can offer advice on a range

of topics, and fees start at just $55

for phone advice about your super.

1800 643 893 qinvest.com.au

QSuper members, Ian and Judy Wintle, wake up each day in their beautiful Birkdale home to the retirement they always wanted. Happy, secure and busier than ever in their beloved garden. Now they’re ready to share their top tips and super strategies with other QSuper members.

“We want other people approaching retirement to benefit from some of the decisions we’ve made over the years. They’ve made such a difference to our situation. We hope they’re as successful for you as they have been for us!”

Words of wisdomfrom the Wintles


Put in as much as you can afford, even if it’s only a little at first. We salary sacrificed our extra contributions which made a big difference to our lump sum on retirement. Find out if it’s right for you too.

Make extra super contributions

1 This product is issued by Challenger Life Company Limited (ABN 44 072 486 938) (AFSL 234670) (“Challenger”). You should consider the appropriateness of the product for your circumstances and read the product disclosure statement (PDS) before deciding whether to acquire this product. You can download the PDS from challenger.com.au/guaranteedtermannuity.htm, or call QInvest on 1800 643 893. The QSuper Board and QSuper Limited are not licensed to provide financial product advice about this product. You should consider obtaining financial advice before making a decision about this product.

At QSuper, we think of the planning process as ‘pretirement’. Pretirement is all about thinking ahead, understanding your options and recognising the right move at the right time. Knowing what choices are available to you is key, and at QSuper we offer access to two great retirement products:

4 The QSuper Income account – to provide a regular, flexible income in retirement.

4 Challenger Guaranteed Term Annuity1 – for a guaranteed income over a fixed timeframe.

Information about both these products, including a breakdown of all the benefits offered by the Income account, can be found on page 6.

One strategy, many benefitsWe also understand that many people approach the final stages of their working life in different ways. For some people it’s the last chance to get their financial ducks in order before retirement, and ensure they have enough to live comfortably. For others it’s more about the mental preparation, and perhaps easing into retirement by cutting down on working hours.

That’s where transition to retirement can help. A strategy that has become increasingly popular in recent years, transition to retirement allows you to access your superannuation through an Income account before you have retired. To see if it could be right for you, check out the information to the right.

Best laid pretirement plans

When it comes to retirement, planning makes perfect. So the sooner you start preparing, the more likely you are to meet your goals.


It’s important to create a budget based on a realistic view of your spending – and then stick to it. Be honest about your outgoings, and try to put something aside for a rainy day.

The seminar we attended gave us a clear picture of our options ahead of retirement. We learned a lot about where we wanted to be in retirement – and how to get there.

The Retirement Income Calculator on the QSuper website is a great tool. We used it regularly to work out how much super we would need to retire in comfort.

Retirement is a step into the unknown, so it’s important to have something to keep you active. For us, it’s a passion for gardening (and our own gardening blog) that keeps us both busy.

Create a budget and stick to it

Calculate how much super you’ll need

Attend a QSuper seminar or webinar

Have a lifestyle plan for retirement

Understanding transition to retirement

In a nutshell, transition to retirement is where you open an Income account while you are still working,

and draw on that while also receiving a salary.

There are different scenarios where you might decide to use a transition to retirement strategy but the main

two are outlined below. 4 If you want to ease into retirement by cutting back your hours

but don’t want to lose out financially, you can use this strategy by topping up your salary with payments from an Income account.

4 If you need to boost your super in the lead up to retirement, you can salary sacrifice a larger amount of your salary to super then use the tax-effective payments from your Income account to maintain your income. Less tax, more super!

The case studies to the right show how two members used these two strategies to help meet their retirement and lifestyle goals.

You can open an Income account using a transition to retirement strategy if you:

4 are a QSuper member

4 are between 55 and under 65 years of age

4 have at least $30,000 in super

4 haven’t met a preservation cashing condition (which for most people is retiring).

To get started with a transition to retirement strategy you simply need to read the Income Account PDS and

complete the Open an Income Account form. You can download the PDS from our website, or call us and we’ll send you a copy. However it’s not necessarily the right strategy for everyone, so it’s a good idea to get expert financial advice first.

As a QSuper member you have access to financial advice from QInvest – call 1800 643 893 to make an appointment.1

AnneAnne is 61 years old and works as a teacher’s aide. She planned to work full-time until 65, but now wants to cut back on work to help care for her new grandchild. Anne decided to transfer most of her super into an Income account. She can then top up her salary with income from her Income account, and reduce the overall amount of tax she pays.

StevenSteven is a 60-year old IT manager and has been crunching his super numbers in the lead up to retirement. He’s come to the conclusion that he needs to boost his super by as much as he can in the five years before he plans to retire, so decided to start a transition to retirement strategy. By salary sacrificing a larger portion of his salary into super then topping up with a tax-free income from his Income account, Steven is giving his balance an extra boost without impacting his take-home pay.

The members depicted are not real members and the case studies are used for illustrative purposes only.

1 Fees apply.

What?

Why?

Who?

How?


Whether you’re looking for an income in retirement, or want to use your super before you retire, an Income account could be just the thing. An Income account lets you use your super to provide a regular tax-efficient income, while giving you control over your payment amount and frequency and investment strategy.

The QSuper Income account gives you control over how much you receive (with annual limits) and how your money is invested. You’re also able to make lump sum withdrawals for sudden expenses or occasional treats, and this isn’t generally available if you are using an Income account through a transition to retirement strategy.

Hassle free estate planningOur Income account also gives you choice over who receives the balance of your Income account either by nominating a reversionary beneficiary who can continue to receive your benefit as an income stream, or by making a binding death benefit nomination.

Am I eligible?A QSuper Income account is open to any QSuper member who has reached their preservation age (currently 55) and has met what’s known as a preservation cashing condition – which for most people is retiring. If you are opening an Income account through a transition to retirement strategy the eligility conditions are a little different – see page 5 for more information. The only other thing you’ll need to get you started is an opening balance of $30,000.

For more detailed information about the Income account, head to qsuper.qld.gov.au/income

Spotlight on the QSuper Income account

Talk to an expert To find out if an Income account is the best option for you, or for more information on other available options, talk with a QInvest financial adviser today.

QInvest has more than 30 advisers based in locations throughout Queensland.

Why not book an appointment today?


ADVERTISEMENT

QSuper members now have access to a special rate on a Challenger Guaranteed Term Annuity.1

1300 360 750

qsuper.qld.gov.au/annuity

Considering an annuity?

4 Gives you the option to diversify your retirement income4 Competitive rates exclusive to QSuper members4 Easy application process4 Access through QSuper - the fund you know and trust

To find out more call QSuper or visit our website.

The best of the bestAs winner1 of Chant West Pension Fund of the Year 2013, our Income account really is the best in market, giving you access to a host of great benefits, including:

4 regular payments at an amount and frequency of your choice (within Government-set limits)

4 a range of investment options, which you can switch between at any time

4 the ability to withdraw lump sum amounts of $1,000 or more whenever you need extra cash

4 the ability to structure exactly how your payments are drawn from your investment options

4 the choice to request that we automatically increase your income payments every financial year in line with inflation. This ensures that when prices go up, you won’t be out of pocket.

1 Chant West Conexus Financial Super Fund Awards 2013.

1 This product is issued by Challenger Life Company Limited (ABN 44 072 486 938) (AFSL 234670) (“Challenger”). You should consider the appropriateness of the product for your circumstances and read the product disclosure statement (PDS) before deciding whether to acquire this product. You can download the PDS from challenger.com.au/guaranteedtermannuity.htm, or call QInvest on 1800 643 893. The QSuper Board and QSuper Limited are not licensed to provide financial product advice about this product. You should consider obtaining financial advice before making a decision about this product.

Your super, your future... your choiceA four-page special outlining QSuper’s range of investment options

Your super journey is entirely your own. But we’re here to support you every step of the way, whether that be by giving you the security of a super strategy that changes as you move through life, or providing the ability to actively choose your own investments.

That’s why whatever your super situation, attitude or knowledge, we’re introducing an investment solution that could suit you.

Super Scoop March 2014 7

At this stage of life you probably appreciate how important your super is – after all, it’s your money for your retirement. But we also understand that some people just want the comfort of knowing their future is being looked after by experts. And that’s where

QSuper Lifetime comes in.

We’re committed to helping all our members achieve the best

possible retirement outcomes, and it’s a responsibility we

take seriously. That’s why we’ve developed the industry-leading Lifetime investment option. This option is designed to provide a more

tailored investment strategy by considering

factors such as your age and account balance. Essentially you can trust our investment professionals to do the thinking for you by seamlessly adjusting your investments as you move through life, providing the right super solution at the right time.

QSuper Lifetime QSuper’s Ready Made and Your Choice options

STRATEGYSET BY

US YOU

Super solutions to suit you


I want to make some super

decisions myself

I’m confident in leaving

my investment decisions to QSuper

Member OnlineYou can change your investment strategy anytime by logging into and making an investment switch. Head to qsuper.qld.gov.au

Want to make an active choice over how your super is invested? No problem – we have a range of alternative investment options that allow you to design your investment strategy. Our Ready Made options allow you to choose an overall diversified strategy (moderate, balanced, aggressive or socially responsible) by pre-mixing different types of growth, defensive and alternative assets.

Alternatively you can build your own strategy by using our Your Choice options. Comprised of a single asset class (cash, bonds, Australian shares and international shares), these options allow you to select exactly what proportion of your super you’d like invested in each asset. Of course you can also combine these options with any or all of the Ready Made options – the possibilities are almost endless. Head to qsuper.qld.gov.au/investmentoptions for more information on our Ready Made and Your Choice options.

We know that some of our members really want to be more hands on when it comes to investing their super. So later this year we’re introducing our new investment option, QSuper Self Invest. This option will allow you to

use some of your super to trade online on the Australian share market, or in exchange traded funds (ETFs), which are pre-bundled assets that trade like shares. If you’re looking for longer-term security for some or all of your super,

QSuper Self Invest will also allow you to invest in term deposits.

If you’re confident about making your

own detailed investment decisions, QSuper Self Invest

could be the option for you. It allows you to have the type of

control you might expect with a self-managed super fund, but without the hassle of worrying about the administrative, legal and taxation issues – that’s what we’re here for.

QSuper Self InvestQSuper’s Ready Made and Your Choice options

STRATEGYSET BY

US YOU

STRATEGYSET BY

US YOU

Super solutions to suit you

Turn the page for more information about QSuper Lifetime and Self Invest. >


I like the idea of controlling exactly how my super is invested

We understand that when it comes to investing your super there’s no such thing as one size fits all. That’s why we’re continually innovating, and are committed to offering our members a range of investment products that’s wider than ever before. Whether you trust us to make your investment decisions for you, or you want to invest your super directly in the share market, our expanding range of investment options is designed to meet your needs.

And every step of the way we offer you access to affordable personal financial advice through QInvest to help you keep your super on track.1

1 Please refer the financial advice section on the QSuper website for details of advice fees.

For detailed information about Lifetime see the Lifetime Important Notice enclosed with this edition of Super Scoop.

QSuper Self InvestQSuper Self Invest, which is launching later this year, will allow you to get really ‘hands on’ with your super. It’ll be a one hundred percent online option, so you’ll need to register for Member Online first. Once you’ve got started, you’ll be able to use funds in your Accumulation or Income account to:

3 invest in term deposits

3 buy and sell Australian shares

3 invest in exchange traded funds (ETFs)

Self Invest will allow you to have a real level of personal control over your money, and your future retirement lifestyle.

How do I find out more?Self Invest will be available to members with an Accumulation or Income account from September 2014. There’ll be plenty of time to find out the details beforehand though, as we’ll be making the Self Invest

Guide available on our website from July.

This guide will give you all the information you need to decide whether QSuper Self Invest is right for

you, including balance and investment limits, investment types on offer, fees and the potential investment risks to watch out for.

We’ll also send you more information about QSuper Self Invest later this year with your benefit statement.

You can also sign up for email updates about QSuper Self Invest at qsuper.qld.gov.au/selfinvest.

You can choose your own investment path.

How does it work...


QSuper LifetimeWhen you invest in the Lifetime option, we look at your super situation and place you in one of the Lifetime groups. This ensures you have an investment strategy for your super that is more tailored than the traditional one-size-fits-all default option. We’ll review all your information every six months, and if we find you now fit the criteria of another group, we’ll automatically place you there instead. And in May we’ll be expanding from three to eight groups.

Super that changes with youAnother key factor we use when deciding which Lifetime group you should belong to is how much you have in your super account. We recognise that if the funds in your account are low, you need to balance the opportunity to build your super through some exposure to growth assets with the need to protect your balance from volatility. This means members in this situation may have a different investment strategy to members the same age with a higher balance.

That’s why we’ve split many of our ‘age based’ groups into futher groups.

But whatever your situation, you can be confident that we’re implementing the strategy that we believe will best help you reach your retirement goals.

We’ll place you in the right group for your super situation.

Ass

etIn

sight

It’s a well known investment principle that diversification is key to managing investment risk. That’s why QSuper invests in a range of different asset types, including property, shares, bonds, cash and infrastructure. Infrastructure is a particularly attractive investment because of its potential to offer stable, long-term growth for members. That’s why we’ve been slowly increasing our exposure to infrastructure since the global financial crisis.

Over the past few years we have invested in quality infrastructure assets such as international airports and utility companies, and in May 2013 we secured a stake in a 99-year lease over Port Botany in Sydney and Port Kembla in Wollongong, together worth more than $5 billion.

Another sterling asset in QSuper’s fleet Operational since the late 1970s, Port Botany is Australia’s second biggest container port, and at just over 10km outside Sydney CBD it services Australia’s largest population base. Located next to Sydney Airport, Port Botany plays a critical role in the New South Wales economy, today boasting three container terminals and two bulk liquid berths. Its trade base is predominantly containerised manufactured products and bulk liquid imports, including petroleum and natural gas.

Port Kembla has a long and proud history in the Wollongong/Illawarra region, having been established more than 120 years ago to export local coal. It has since become one of the major ports of Australia, with growth driven by both the expansion of the traditional coal and steel industries, and the development of new and emerging industries. Today Port Kembla is classed as a key asset of the Illawarra region and has become both Australia’s largest vehicle import hub and largest export grain terminal.

Growth drives port expansionOne of the most important considerations when acquiring an infrastructure asset is that it has the potential to continue to provide growth into the future. Both ports meet this criteria, having undergone a rapid capacity expansion in recent years that looks set to continue. In one of Australia’s largest port expansion projects in the past three decades, Port Botany recently completed a significant upgrade to its container port facilities. The project also included improvements to surrounding road and rail infrastructure to support growth in the years ahead. In addition, it brought on board a second bulk liquid berth in 2013, designed to accommodate 120,000 tonne, 270-metre long vessels.

At Port Kembla, expansionary works are being planned to develop an outer harbour, which will provide additional berthing and land facilities to accommodate future trade growth and industry development. These works complement work recently completed to redevelop the inner harbour, which was carried out to cater for the growth in existing trade bases.

These expansionary works reflect the strong growth potential of both ports, making this an investment that is expected to continue to provide solid returns for our members over the long term.1

1 Past performance is not a reliable indicator of future performance..

Ports harbour potential

In addition to Port Kembla and Port Botany,

some of our other assets include world icons

like One Times Square New York, international

airports such as Heathrow and Edinburgh, and

shopping centres like Robina Town Centre on

the Gold Coast. To view other asset profiles visit

qsuper.qld.gov.au/assetprofiles.

Asset name: Port Botany, Sydney and Port Kembla, Woollongong 99-year lease. Date of investment: April 2013Value of investment: $5.07 billion (as at May 2013)

Options with current exposure:

QSuper Lifetime

QSuper Balanced

QSuper Aggressive

QSuper Moderate

Port Botany

Port Kembla


At the end of 2013 some important changes were made to our insurance products, resulting in even better benefits, for even more of our members. QSuper prides itself on delivering the best possible benefits to members – and our insurance is no exception. The changes we’ve made enhance our existing cover, and provide greater reassurance to members and their families.

Better to be safe than sorryLater in life, insurance isn’t just ‘nice to have’ – it’s an important financial responsibility. As the likelihood of illness, injury, or worse, increases, so too does the need to have adequate cover for you and for your loved ones.

It’s also an effective way to protect the money you’ve worked so hard to save. If you were unable to work due to illness or injury for an extended period of time, income protection insurance would help prevent you running down your savings.

Your loved ones will be looked afterWhen it comes to death and total and permanent (TPD) insurance… well, the facts speak for themselves. No one likes making provision for worst case scenarios, but in the event of a serious incident, your loved ones will be very glad you did.

Remember, insurance is a vital component of your QSuper membership. And while we hope you never have to claim, in the event of an accident or illness your insurance protection could be priceless.


Want to know more?Learn more about QSuper’s insurance cover at qsuper.qld.gov.au/insurance

How QSuper insurance has changedExpanded eligibilityThousands of extra members will now have access to death and TPD insurance. Previously, only members who had an employer contributing to their super account were eligible. Now many members who don’t have a contributing employer are covered, with premiums automatically deducted from your account.

Increased benefitsFor most members the value of each unit of death and TPD insurance has increased, leading to higher levels of cover. For example, a member aged 50 will see the value of each unit increase from $20,000 to $48,000.

Shorter pre-existing condition exclusion periodsWe’ve changed the exclusion policy that applies to claims relating to pre-existing conditions (conditions diagnosed before cover began).

u There is now no pre-existing condition exclusion period for most members for standard death and TPD cover.

u The exclusion period for pre-existing conditions for both additional death and TPD and income protection cover has been reduced from seven to five years.

Change to premiumsThe cost of insurance premiums is rising across the industry, and it has been necessary for us to increase premiums for death and TPD insurance and, for most members, income protection cover too. However these increases also ensure we are providing you with the best possible cover and service.

Option to restartIf you have previously cancelled your Accumulation account insurance, you will have the option of restarting your cover.

QSuper insurance offers:u Competitive premiumsu No initial health checksu One-on-one claims managementu Shorter waiting periods than industry averagesu Flexible cover to suit your needs

Member OnlineMember Online lets you view your personal insurance details at any time, and request a change to your cover. Head to qsuper.qld.gov.au to log in or register.

Name: John and Rebecca Age: 57 and 55 Accumulation account balances: John has $325,000 and Rebecca has $240,000

What happens to my super after my death?

Case study corner

By Alan Sher

Financial Adviser

Brought to

you by QInvest

John and RebeccaJohn and Rebecca’s storyJohn and Rebecca have recently married, and came to see me to receive some holistic financial advice and discuss how they might best maximise their situation to achieve their future lifestyle goals.

During the meeting I reviewed their estate planning requirements, as the couple have an interesting blended family situation to consider. John has a son and daughter, Jason and Liz, from two previous marriages and Rebecca has a daughter, Jessica.

As they had both originally planned for retirement assuming they would be single, they had come to the joint decision that in the event of their death they each wanted their remaining superannuation to go to their respective children. They asked me to outline what their options were to ensure this happened.

What are John and Rebecca’s options?I explained to John and Rebecca that it is very important that their wills are kept up to date to ensure their assets would be distributed in line with their wishes in the event of their deaths. However their superannuation doesn’t form part of their estate and cannot be included in their wills.

This means that in the event of their death, their super would be paid at the discretion of the QSuper Board of Trustees in accordance with Australian Government legislation. I explained that this is generally a dependant or the executor of your estate, but if there are multiple claimants the Board is obliged to carefully consider all the information before making a decision.

John and Rebecca both commented they would like more control and certainty over how their super would be distributed, so I told them that they did have the option to make a binding death benefit nomination for their QSuper accounts. This would allow them to nominate exactly who their super is distributed to, and in what proportion. And providing the nomination is valid on their death, the QSuper Board is obligated to pay the benefit as directed.

To make sure they fully understood all their options, I also explained that if they opened QSuper Income accounts in the future they would each also have the opportunity to nominate what’s known as a reversionary beneficiary. This is someone who can continue to receive their Income account as a regular income stream after their death. I did however go on to explain that a reversionary beneficiary generally cannot be an adult child, and additionally you

can only nominate one person to receive your Income account in this way.

Given their estate planning strategy, a reversionary beneficiary nomination probably wouldn’t be relevant to John and Rebecca. But if in the future, they did change their minds and wanted the surviving spouse to receive the super in the event of the other’s death, it may be an option they want to explore. However a binding death benefit nomination can also apply to an Income account, so if either of them was to transfer their funds, they could still be secure in the knowledge that their super would pass to their respective children.

What do John and Rebecca do?John and Rebecca both resolve to get their wills up to date, and also to make individual binding death benefit nominations so their super can pass to their children. They also understand they need to renew their nominations every three years so they remain valid.

By doing this, John and Rebecca gain the peace of mind of knowing that in the event of death their superannuation assets will be passed to their preferred beneficiaries without family disputes or drawn out court proceedings.


Want to know more?More information on death benefits relating to your QSuper account can be found at qsuper.qld.gov.au/deathbenefit

The members depicted are not real members and the case study is used for illustrative purposes only.

QSuper has a range of investment options, each with diff erent strategies, objectives and risk profi les. We publish a standard risk measure1 (SRM) that estimates the probability of negative annual returns over a given period. However the level of investment risk that’s right for you is very individual, and the risks associated with diff erent asset classes can change over time. In this new regular feature our Investments Team provides details of how current market conditions could impact our investment options over the coming two to three years.

Understanding the potential impacts of market conditions on QSuper’s investment options

Risk OutlookTHE INVESTMENT

MARCH 2014

Past performance is not a reliable indicator of future performance. 1 The Standard Risk Measure (SRM) is based on industry guidance which allows members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20 year period. The SRM is not a complete assessment of all forms of investment risk, for instance it does not detail what the quantum of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. For more information, please refer to the Investment Choice Guide, available on our website or call us and we can send you a copy. 2 Average annual return for the QSuper Cash option for the last ten years has been 4.13% per annum.

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Talk to an expertIf you want advice on an investment strategy that is right for you, contact QInvest today.


Managing risk through diversifi cation. Our Ready Made options consist of various mixes of the asset classes discussed above, as well as having a degree of exposure to property, infrastructure and alternatives. Because of this, many of the potential market risks already discussed will apply to our Ready Made options (see our website for current asset allocations). For example, the QSuper Moderate option and a number of the groups within QSuper Lifetime have signifi cant exposure to cash, so the challenges associated with cash will be a signifi cant consideration for this option. However the risks posed to both the International and Australian Share options will be of more relevance for the QSuper Aggressive option, as it is dominated by equity risk.

The QSuper Socially Responsible and QSuper Balanced options, and Lifetime groups with a higher exposure to growth assets, also have signifi cant equity risk, so they will be impacted by the global economic issues discussed above. These options also invest in bonds, so having exposure to both may have the eff ect of reducing overall volatility in these options.

A challenging outlook. Our investment specialists manage our options within ranges set by the QSuper Board, and constantly monitor markets in order to manage risk and identify emerging opportunities.

However the current investment environment poses a number of challenges, highlighting the importance of taking a diversifi ed approach to your investments in order to protect against the risk of too much exposure to any single asset class.

Global volatility and Chinese growth create uncertainty. While this option is impacted by the global economic issues outlined above, additional factors, including rising unemployment and high household debt, an uncertain path for the still-elevated Australian dollar, and a structural slowdown in Chinese economic growth, could all aff ect the returns of the Australian Shares option in the coming years. There is a high concentration of mining and banking stocks in the Australian share market that are sensitive to the evolution of these economic outcomes, as well as others not listed here. Despite recent strong share market returns, higher volatility for this option is likely in the foreseeable future.

Slow growth and continuing volatility. There are currently a number of issues around the globe creating uncertainty for major share markets. Among them is the impact on economic growth, global liquidity and asset prices as the US Federal Reserve unwinds its quantitative easing program. Partly owing to this, sentiment toward Emerging Markets (EMs) has capitulated over the fi nancial year to date. This, in turn, has question-marked the potential growth rate (and future earnings potential) of the EM region more broadly, which may also carry implications for the economic recovery currently underway for some developed economies. Meanwhile, questions around the ability of ‘Abenomics’ to refl ate the Japanese economy remains an ongoing source of uncertainty, and in Europe, the growth recovery remains in its infancy. While returns for International Shares over the last year have been strong, the uncertain outlook for this option means that it is likely to experience ongoing volatility.

Returns likely to be lower than recent strong returns. Another result of low cash rates is lower bond yields. For example the yield on Australian Government 10-year bonds is currently around 4.2% per annum, which is considerably lower than the rate of 6.5% seen as recently as 2008. As yields have fallen signifi cantly, it has brought about some capital gains for bonds in recent years, consequently boosting returns for this option. However, such high returns are unlikely to continue in the years ahead, particularly as major off shore central banks normalise monetary policy as economic growth recovers further.

Potential for lower returns than normal.2 Lingering eff ects of the GFC have seen major central banks around the globe lower their cash rates to record lows in an eff ort to stimulate economic growth. While Australia’s cash rate has not dropped to the extreme lows seen elsewhere, at 2.50% it is still below the average for the last decade, and in fact the lowest it has been since the 1960s. With Australian mining investment expected to continue to decline further in the short term, and to continue to weigh on near-term economic and employment growth prospects, market pricing suggests the cash rate will remain low for a while longer.

Cash

Diversifi ed Bonds

International Shares

Australian Shares

QSuper Balanced

QSuper Moderate

QSuper Socially Responsible

QSuper Aggressive

QSuper Lifetime


scoopWhat’s the?Here’s the latest round-up of what’s new at QSuper, and for the super industry.

Fortnightly payments for the Income accountWe’re always looking to provide the best possible retirement products. As part of this we’ve added a new fortnightly payment option for our Income account, in addition to the existing annual, half-yearly, quarterly and monthly payment cycles. For more information about our Income account visit qsuper.qld.gov.au/income.

Increase in concessional contributions capBefore-tax contributions (which include contributions made by your employer and salary sacrifice contributions) are called concessional contributions, and are currently capped at $25,000 per financial year, or $35,000 for people aged 59 and over on 30 June 2013. From 30 June 2014, the $35,000 cap will be accessible to people aged 49 and over. For more information visit qsuper.qld.gov.au/contributionscap.

Unlimited investment switchesWe’ve removed the limit on the number of investment switches you can make for Accumulation and Income accounts, giving you greater control and flexibility to choose how your super is invested. You’re also able to make a switch online at any time using Member Online.

QSuper introduces MySuper optionOn 16 December 2013 we introduced our MySuper option, QSuper Lifetime, which has replaced the QSuper Balanced option as our default investment option for Accumulation accounts. You can find out more about this lifecycle investment strategy at qsuper.qld.gov.au/lifetime.

Removal of Indexed Mix investment optionWe closed the QSuper Indexed Mix option on 16 December 2013. The primary reason for this move was the number of similarities with the QSuper Balanced option, which is lower risk than the QSuper Indexed option and carries a similar return objective. If you were formerly in the QSuper Indexed Mix option you would have been transferred to the QSuper Balanced option, unless you chose to transfer to a different option.

Change to QSuper Board structure There’s been a number of recent changes to our Board of Trustees following changes to the QSuper Act. The number of trustees has been reduced from twelve to nine and trustees can now only serve a maximum of nine years. The Board now comprises four employer representative trustees, four member representative trustees and one independent trustee. As part of these changes, Karl Morris was appointed as Chairman of the Board on 1 January 2014. For a full list of changes visit qsuper.qld.gov.au/board.

Proposed Federal Government superannuation changes The following proposed superannuation measures are awaiting Senate endorsement:

4 abolishing the low-income superannuation contribution

4 a two-year freeze of the Superannuation Guarantee (SG) increase. If passed by the Senate, the SG contribution will remain at 9.25% until 1 July 2016.

We’ll keep you updated on current and future legislative proposals through our website.

QSuper caps administration feeQSuper is committed to providing great value to our members. That’s why we’re capping administration fees effective from the 2013/2014 financial year. This means that if you pay more than $1,540 in administration fees in a financial year (totalled across all your Accumulation or Income accounts) you will receive a rebate for this excess amount back into your QSuper account/s.

Some important points to note about the rebate:

4 It will be paid to your QSuper account/s in July of the next financial year – with the first payment in July 2014 – although to be eligible you must still hold an Income or Accumulation account at the time the rebate is paid.

4 Any rebate that relates to fees paid on your Accumulation account will have an amount deducted from it for tax purposes.

4 If the value of the rebate paid to an account is 5% or more of your account balance on the day it’s paid, it will count towards your concessional contributions cap.

For more information about the administration fee cap and rebate, please see qsuper.qld.gov.au/feecap.

Important information from the QSuper Board

50% rebate calculated on the amount of ongoing commission (excluding GST) payable to QInvest. Rebate offer not available to GST-registered borrowers. The credit services advertised are provided by QInvest, not the QSuper Board or QSuper Limited (together the QSuper Group). QInvest is ultimately owned by the QSuper Board (as trustee for the QSuper Fund), however the QSuper Group does not receive any direct payments or commissions from QInvest as a result of members using the LoanFinder service. Members should make their own assessment regarding the suitability of this service for their individual needs.

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Another great benefit of your QSuper membership.QInvest’s specialist brokers have access to hundreds of lending products and will go the extra mile to find the best deal for you. Our commission rebate will also save you money so you can pay off your loan sooner.

Why not make an appointment today?

Introducing QInvest LoanFinder, our mortage broking service.

qinvest.com.au/loanfinder 1800 643 893

Exclusive to QSuper

members, their families

and friends.

QSuper has a range of investment options, each with diff erent strategies, objectives and risk profi les. We publish a standard risk measure1 (SRM) that estimates the probability of negative annual returns over a given period. However the level of investment risk that’s right for you is very individual, and the risks associated with diff erent asset classes can change over time. In this new regular feature our Investments Team provides details of how current market conditions could impact our investment options over the coming two to three years.

Understanding the potential impacts of market conditions on QSuper’s investment options

Risk OutlookTHE INVESTMENT

MARCH 2014

Past performance is not a reliable indicator of future performance. 1 The Standard Risk Measure (SRM) is based on industry guidance which allows members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20 year period. The SRM is not a complete assessment of all forms of investment risk, for instance it does not detail what the quantum of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. For more information, please refer to the Investment Choice Guide, available on our website or call us and we can send you a copy. 2 Average annual return for the QSuper Cash option for the last ten years has been 4.13% per annum.

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Talk to an expertIf you want advice on an investment strategy that is right for you, contact QInvest today.


Managing risk through diversifi cation. Our Ready Made options consist of various mixes of the asset classes discussed above, as well as having a degree of exposure to property, infrastructure and alternatives. Because of this, many of the potential market risks already discussed will apply to our Ready Made options (see our website for current asset allocations). For example, the QSuper Moderate option and a number of the groups within QSuper Lifetime have signifi cant exposure to cash, so the challenges associated with cash will be a signifi cant consideration for this option. However the risks posed to both the International and Australian Share options will be of more relevance for the QSuper Aggressive option, as it is dominated by equity risk.

The QSuper Socially Responsible and QSuper Balanced options, and Lifetime groups with a higher exposure to growth assets, also have signifi cant equity risk, so they will be impacted by the global economic issues discussed above. These options also invest in bonds, so having exposure to both may have the eff ect of reducing overall volatility in these options.

A challenging outlook. Our investment specialists manage our options within ranges set by the QSuper Board, and constantly monitor markets in order to manage risk and identify emerging opportunities.

However the current investment environment poses a number of challenges, highlighting the importance of taking a diversifi ed approach to your investments in order to protect against the risk of too much exposure to any single asset class.

Global volatility and Chinese growth create uncertainty. While this option is impacted by the global economic issues outlined above, additional factors, including rising unemployment and high household debt, an uncertain path for the still-elevated Australian dollar, and a structural slowdown in Chinese economic growth, could all aff ect the returns of the Australian Shares option in the coming years. There is a high concentration of mining and banking stocks in the Australian share market that are sensitive to the evolution of these economic outcomes, as well as others not listed here. Despite recent strong share market returns, higher volatility for this option is likely in the foreseeable future.

Slow growth and continuing volatility. There are currently a number of issues around the globe creating uncertainty for major share markets. Among them is the impact on economic growth, global liquidity and asset prices as the US Federal Reserve unwinds its quantitative easing program. Partly owing to this, sentiment toward Emerging Markets (EMs) has capitulated over the fi nancial year to date. This, in turn, has question-marked the potential growth rate (and future earnings potential) of the EM region more broadly, which may also carry implications for the economic recovery currently underway for some developed economies. Meanwhile, questions around the ability of ‘Abenomics’ to refl ate the Japanese economy remains an ongoing source of uncertainty, and in Europe, the growth recovery remains in its infancy. While returns for International Shares over the last year have been strong, the uncertain outlook for this option means that it is likely to experience ongoing volatility.

Returns likely to be lower than recent strong returns. Another result of low cash rates is lower bond yields. For example the yield on Australian Government 10-year bonds is currently around 4.2% per annum, which is considerably lower than the rate of 6.5% seen as recently as 2008. As yields have fallen signifi cantly, it has brought about some capital gains for bonds in recent years, consequently boosting returns for this option. However, such high returns are unlikely to continue in the years ahead, particularly as major off shore central banks normalise monetary policy as economic growth recovers further.

Potential for lower returns than normal.2 Lingering eff ects of the GFC have seen major central banks around the globe lower their cash rates to record lows in an eff ort to stimulate economic growth. While Australia’s cash rate has not dropped to the extreme lows seen elsewhere, at 2.50% it is still below the average for the last decade, and in fact the lowest it has been since the 1960s. With Australian mining investment expected to continue to decline further in the short term, and to continue to weigh on near-term economic and employment growth prospects, market pricing suggests the cash rate will remain low for a while longer.

Cash

Diversifi ed Bonds

International Shares

Australian Shares

QSuper Balanced

QSuper Moderate


QSuper Aggressive

QSuper Lifetime


1 QSuper Lifetime returns are since inception on 16 December 2013.Past performance is not a reliable indicator of future performance. Returns may vary considerably over time. Each of the options has a different objective, risk profile and asset allocation. Visit the Investment options page on the website for more detailed information. Changes to inflation, fees, asset allocations, option objectives and risk play a significant part in the return of any investment option.

Report CardAs at 28 February 2014

Contacting QSuperContact Centres70 Eagle Street Brisbane63 George Street BrisbanePh 1300 360 750+617 3239 1004 (international) Fax 1300 241 602+617 3239 1111 (international)Monday to Friday 8.30am to 5.00pm AESTGPO Box 200 Brisbane Qld 4001qsuper.qld.gov.au

Find us on:facebook.com/qsuperfundtwitter.com/qsuperfundyoutube.com/qsuperfund

SuperRatings does not issue, sell, guarantee or underwrite this product.Chant West has given its consent to the inclusion in this edition of Super Scoop of the references to Chant West and the inclusion of the logos and ratings or awards provided by Chant West in the form and context in which they are included. The Chant West ratings logo is a trademark of Chant West Pty Limited and used under licence. It is only current at the date awarded by Chant West. The rating and associated material is only intended for use by Australian residents within the jurisdiction of Australia and is not permitted to be considered or used by a party outside of Australia.

Important information This information is provided by the fund administrator, QSuper Limited (ABN 50 125 248 286 AFSL 334546) which is ultimately owned by the QSuper Board (ABN 32 125 059 006) as trustee for the QSuper Fund (ABN 60 905 115 063). This information has been prepared for general purposes only without taking into account your objectives, financial situation, or needs and should not be relied on as legal or taxation advice, nor does it take the place of such advice. Any statements of law or proposals are based on our interpretation of the law or proposals as at the time of printing. As a result, you should consider the appropriateness of the information for your circumstances and read the product disclosure statement (PDS) before deciding whether to acquire, or continue to hold, a product. You can obtain a PDS at qsuper.qld.gov.au or by calling us on 1300 360 750. Unless stated otherwise, all products are issued by the QSuper Board as trustee for the QSuper Fund. Where the term ‘QSuper’ is used in this document, it represents the QSuper Board, the QSuper Fund and QSuper Limited, unless expressly indicated otherwise. If you do not wish to be contacted except when required by legislation, please call us. QInvest Limited (ABN 35 063 511 580, AFSL and Australian Credit Licence number 238274) (QInvest) is ultimately owned by the QSuper Board (ABN 32 125 059 006) as trustee for the QSuper Fund (ABN 60 905 115 063), and is a separate legal entity which is responsible for the financial services and credit services it provides.

QSuper investment options1 year% p.a.

Year to date

3 year% p.a.

5 year% p.a.

10 year% p.a.

Investment returnsAccumulation account

QSuper Lifetime1

Lifetime Aspire 3.64% n/a n/a n/a n/a

Lifetime Sustain 1 2.16% n/a n/a n/a n/a

Lifetime Sustain 2 1.44% n/a n/a n/a n/a

Ready Made options

QSuper Moderate 6.52% 7.25% 6.47% 7.71% 5.97%

QSuper Balanced 10.22% 10.87% 8.75% 11.01% 7.41%


11.15% 13.31% 8.62% 10.13% n/a

QSuper Aggressive 14.22% 16.84% 10.33% 12.78% 7.37%

Your Choice options

Cash 1.39% 2.16% 3.01% 3.39% 3.98%

Diversifi ed Bonds 4.66% 4.30% 6.42% 8.33% n/a

International Shares 16.06% 22.27% 12.12% 16.85% n/a

Australian Shares 16.70% 12.98% 9.05% 15.01% n/a

QSuper feesQSuper is committed to keeping the fees for our investment options among the lowest in Australia. For information on the fees for all our investment options, see qsuper.qld.gov.au/fees.

© QSuper Board of Trustees 2014. 6557 03/14 50Plus16 Super Scoop March 2014

Exclusive QSuper Member Competition

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You’ll automatically be in with a shot at winning a digital SLR camera kit.

The promoter of this photographic competition is QSuper Limited (ABN 50 125 248 286). Full terms and conditions are available on our website.

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PRETIREMENT PLANNING - QSuper...to get there. The Retirement Income Calculator on the QSuper website...

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