How much will financial advice cost you?
21 January 2020
BUSSQ provides financial advice through Skylight Financial Solutions. The following examples will help you understand how much it could cost you to receive advice through Skylight, which was built by BUSSQ.
Straightforward Advice at no extra cost for BUSSQ members
Kevin, age 50
At age 50, Kevin decides he needs to start building his superannuation in order to retire one day - so he contacted BUSSQ for financial planning advice. After talking with a Skylight Financial Planner, it was established that Kevin could implement a superannuation contribution strategy, and it was recommended that he commence salary sacrificing. This way he could increase his super fund contributions but still live comfortably on his remaining take home pay.
Direct cost of financial planning advice to Kevin: Nil, as it comes under the category of Straightforward Advice.
Bill, age 32
Bill has a young family and a mortgage. He wants to put things in place to ensure that if the unthinkable happens, his family doesn’t have to worry about finances. He currently has the standard level of life insurance within his BUSSQ super account.
After discussion, a Skylight Financial Planner established that he should increase his insurance cover to protect himself and his family. He increased the level of cover for Death Insurance, Total and Permanent Disablement Insurance and Income Protection Insurance. He is now in a better financial position should the worst happen, and feels happy that his family's future is secure.
Direct cost of financial planning advice to Bill: Nil, as it comes under the category of Straightforward Advice.
Complex Advice charged at an hourly fee
Bob and Betty, both age 60
Bob works full time and Betty part time. Bob has a BUSSQ account and Betty currently has two super accounts, one with BUSSQ and one with another super fund. They are both hoping to retire in five years.
After an initial discussion with a Skylight Financial Planner - which was free of charge - Bob and Betty had a follow up meeting where it was recommended that Bob should:
- Commence a BUSSQ Transition to Retirement Pension (TTR),
- Commence salary sacrificing into his BUSSQ Premium Choice super account.
This would allow him to contribute an extra $3,000 per year into super after tax, but he could maintain his current take home pay.
The Skylight Financial Planner also recommended that Betty roll her other super account into her BUSSQ Premium Choice super account and make voluntary contributions into that account with her surplus cash flow.
This type of advice is not covered under Straightforward Advice, and comes under Complex Advice.
As a result, there is a cost to Bob and Betty to provide them this financial advice, and to help them to implement the recommendations to ensure they are on track to meet their retirement goals. They received a Statement of Advice covering the Skylight Financial Planner's recommendations, and how they would be better off having taken our advice.
Direct cost of financial planning advice to Bob and Betty: This complex financial advice was charged at $220 per hour and came to $660 in total. They have the option of deducting the respective cost from each of their BUSSQ super fund accounts.
Alfred, age 40
Alfred has been a BUSSQ super fund member for some time, but along the way has also found himself with two other super funds. He wants to tidy things up and make life easier.
One of these funds is a retail super fund with a large bank, while the other is another industry superannuation fund.
The Skylight Financial Planner researched the running costs, returns, fees and options with these two super funds, which uncovered that Alfred was paying more than double the amount of fees on his retail superannuation fund than he was in his BUSSQ super fund account. This amounted to over $1,000 per year on his current balance. Skylight's Financial Planner also found that, when comparing similar options across both super funds, the performance of the BUSSQ super fund was better than that of his retail super fund. With his other industry superannuation fund, the running cost was similar to that in BUSSQ, so there was no significant benefit in rolling this super over to his BUSSQ super fund. However, Alfred wants to make life easier, and stated his preference to consolidate his superannuation into the one account.
We recommended that Alfred roll his other two super funds into his BUSSQ industry super fund account in order to reduce the costs on his superannuation and also make things easier in keeping track of his finances.
This type of financial planning advice is not covered under Straightforward Advice and comes under Skylight's Complex Advice area. As a result, there is a cost to Alfred for Skylight to provide him this financial planning advice and to help him implement the recommendations to ensure he gets his superannuation sorted. He received a Statement of Advice covering our recommendations, and how he would be better off having taken our financial advice.
Direct cost of financial planning advice to Alfred: $550, which Alfred chose to take out of his BUSSQ super fund account.
To speak to a Financial Planner or to make an appointment for financial advice, go to skylight.com.au or call us on 1800 692 877.
Skylight's Financial Services Guide is available at skylight.com.au or call 1800 759 544 to request a copy.