Telstra Super is offering members of its Defined Benefit fund (Telstra Super Division 2) the option of transferring to its accumulation fund, Telstra Super Corporate Plus (Defined Contribution).
An initial outline of the offer has been sent to all members of the Defined Benefit fund. Each member will also be receiving an individualised information pack which should arrive by mid-August.
Telstra and Telstra Super will be holding joint information sessions on the offer in the coming months which will provide fund members with the opportunity to get further one-on-one advice about the implications of any decision to change funds.
In the case of Telstra, no recommendation will be made to employees as to whether to take up the offer.
Advice will be limited to the way the change will interact with current pay structures, including the superannuation guarantee component of Fixed Remuneration.
Telstra Super is also taking a neutral position as it recognises that the appropriate decision for individual fund members will depend on each person’s particular circumstances – age, length of service, overall financial position and so on.
For the same reasons, the CWU is not making any recommendation to its members as to choice of fund. The union does however strongly recommend that members seek individual financial advice before making a decision.
The key factor to bear in mind is that moving from a defined benefit fund to an accumulation fund involves transferring risk from the fund to the individual. Market fluctuations do not affect your defined benefit –for better or for worse - but can have a significant impact on the final level of your holdings in an accumulation fund.