Vision Super pandemic planning

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Update 23 March 2020

As the COVID-19 coronavirus continues to spread through the Australian community, Vision Super’s priority is the health and safety of our staff, members, employers and the community with whom we have contact.

We continue to be led by the recommendations of key government authorities and relevant health professionals. We are taking a number of precautions to support our people, to maintain service to you and to be prepared should the situation change significantly.

We will continue to provide regular updates with the most efficient way to do this will be via this web page.

 

Early release of superannuation 

The Government has announced that individuals affected by the Coronavirus will be allowed to access up to $10,000 of their superannuation in 2019-20 and a further $10,000 in 2020-21.

Eligible individuals will be able to apply online through MyGov website to access up to $10,000 of their superannuation before 1 July 2020. They will also be able to access up to a further $10,000 from 1 July 2020 for approximately three months (exact timing will depend on the passage of the relevant legislation).

 

Eligibility

To apply for early release, you must satisfy any one or more of the following requirements:

  • you are unemployed; or
  • you are eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
  • on or after 1 January 2020: you were made redundant; or your working hours were reduced by 20 per cent or more; or if you are a sole trader — your business was suspended or there was a reduction in your turnover of 20 per cent or more.

People accessing their superannuation will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans’ Affairs payments.

Further details can be found in the government factsheet.

 

Market update

The global macro environment has shifted dramatically since the beginning of the year, fuelled predominantly by the outbreak of the coronavirus teamed with a shock to oil prices. Equity markets across the globe have recorded dramatic falls with all sectors being impacted, albeit to different degrees. Oil prices are down nearly 50% and equity markets are generally down around 30% wherever you look around the globe. 

In February, China imposed drastic measures to curb the spread of the coronavirus including lockdowns of factories and in some cases whole towns along with school shutdowns. Although the authorities are now stressing orderly resumption of work and production, economic data suggests the economy has yet to restart in a meaningful way. Governments around the world have announced both monetary and fiscal measures to support their economies with the US Federal Reserve cutting rates a full percentage point to 0% and the RBA also announcing a cut to rates to a record low of 0.25%.

The Australian dollar depreciated further against major currencies in February and broke through the 60 cent US barrier and is currently in the mid 50’s versus the US dollar. This will make the Australian economy more competitive against other economies and also has helped cushion some of the fall in overseas stock markets. Listed property and infrastructure followed the downward trend of equity markets and produced negative returns for that month.

 

Performance update

The above-mentioned volatility has impacted investment option performance. Unit pricing and monthly performance can be found on our investment pages of the website. Here’s an update of our performance financial year to 18 March 2020, along with our longer-term performance.  

 

Super plans* Return for financial year to 18 March 2020
Premixed 
Balanced Growth -7.37%
Conservative -3.87%
Balanced  -6.38%
Sustainable Balanced -12.85%
Growth -10.38%
Single sector 
Just Shares -16.71%
Australian Equities -19.30%
International Equities -13.31%
Innovation and disruption -0.05%
Diversified Bonds -0.20%
Cash 0.78%

 

* Non-commutable Allocated Pension (NCAP) have the same investment returns as the Super Plans from 1 July 2017.  

 

Retirement plans (excluding NCAPS) Return for financial year to 18 March 2020
Premixed
Balanced Growth -7.59%
Conservative -4.14%
Balanced  -6.69%
Sustainable Balanced -13.52%
Growth -10.92%
Single sector 
Just Shares -18.37%
Australian Equities -20.64%
International Equities -14.60%
Innovation and disruption 0.82%
Diversified Bonds 0.14%
Cash 0.92%

 

Please remember as per our earlier article all investments have risks and that like any other long-term investment, you can expect your super to have ups and downs, which can be caused by global events.

The ups and downs are normal - because the value of the assets (like shares) that your super is invested in also goes up and down. If you see your super balance go down, it can be tempting to make a change to a more conservative investment option, like cash. But when it comes to super, it’s important to focus on the time your super has left to be invested and have an investment strategy that’s right for your personal objectives, situation and needs.

Super is a long-term investment, but of course some people are closer to retirement than others. Younger people may be happy to ride out the blips and recoveries along the way, while others may be more willing to look at other options because they feel retirement is closer. It’s worth bearing in mind that even if you’re retired or coming up to retirement age, your money may still need to be invested for another 20-30 years. Some people see their superannuation balance fall in value and are tempted to switch into a lower risk investment option, but by doing this, they may effectively be selling shares at a reduced value and missing out on the higher returns when markets recover.

Before taking quick action with your super investments, you should consider your personal objectives, situation and needs. Also remember that historical returns are no guarantee of future performance.

 

Vision Super historical performance (to 31 January 2020) 

Help, support and advice

If you have any queries about any of the topics, we have experts who can help. Our Contact Centre can help with general enquires, along with helping you check your balance and investment option(s) by setting you up to your online Vision Super account.

If you are after help understanding the right investment option for you, you can discuss your personal risk profile with a financial adviser. They will be able to recommend the option that’s best suited for you.

To book an appointment with a Vision Super financial planner, complete the online form or call the Contact Centre on 1300 300 820 (Monday to Friday 8:30am to 5pm) to arrange an appointment. Advice on certain single superannuation issues like your investment option can usually be provided at no cost to you, over the phone or via video conference.

 

Service and wait times

Like every super fund at the moment, we’re experiencing increased calls. Rest assured our teams are working hard to provide the level of service that you’ve come to expect from us. All of our teams remain fully operational, including our Member Services team.

However, telephone wait times for the Contact Centre in particular are likely to be a little longer, not just due to the increase in call volumes, and the complexity of the calls. Your patience and understanding is greatly appreciated.

 

Withdrawals and claims

We’re continuing to process income payments as usual. Our team is also continuing to process insurance claims, contributions and lump sum payments. We will continue to do our best to deliver a quality service to you.

 

Useful sources of COVID19 information

If you are looking for information and updates on COVID19 the websites and podcast below provide up to date and useful information.

World Health Organisation provides information and updates on the Coronavirus disease (COVID) outbreak both internationally and in Australia.

Australian Government, Department of Health provides the latest information about the spread of COVID-19 and the steps being taken to slow the spread.

ABCS Corona cast podcast – daily 10 minute podcast providing an update each day https://www.abc.net.au/radio/programs/coronacast/latest-segments/12025304

 


 

Updated 13 March 2020

An increasing number of members have contacted us, concerned about recent share market falls and future risks of the new coronavirus.

As the outbreak of the Coronavirus (COVID-19) continues to create international headlines, Vision Super is closely monitoring this situation as the number of reported cases grows globally. In response to this evolving issue, members of Vision Super’s Management Group are meeting regularly to discuss our approach to managing the impacts of the Coronavirus.

What is happening in the market?

Equity markets have become very volatile with initial substantial falls. This has been due to the corona virus but also due to a large fall in oil prices which has impacted energy companies negatively. This situation may change within a very short period. Markets are experiencing unusually large up days as well as down days. Currencies and commodity markets have also been affected. The virus itself continues to spread and is becoming more and more difficult to contain.

Your Super

Members in the default Balanced Growth option are in a well-diversified option with a mix of growth and defensive assets. This option has a long-term investment horizon. Over the 20 years to end February 2020 it had provided members with a return of 6.5% p.a. Over this period, we have had a number of years with negative returns including during the GFC. Options with exposure to growth assets may have noticed a fall in their account balances. We expect peak to trough falls of 20% or more once every three years on average. Nonetheless equities have been the strongest performing asset class over the long term. The fourth quarter of 2018 was the last such period of a 20% loss with equity markets recovering strongly subsequently. If you are concerned about your financial situation and want to review your investment strategy you may wish to seek investment advice.

To book an appointment with a Vision Super financial planner, complete the online form or call the Contact Centre on 1300 300 820 (Monday to Friday 8:30am to 5pm) to arrange an appointment. Advice on certain single superannuation issues like your investment option can usually be provided at no cost to you, over the phone.

Vision Super’s Investment approach – balanced growth option

Vision Super has reduced risk over the last few years as markets strengthened. We took a more defensive position after the onset of the crisis in Europe as the characteristics of the virus became clearer. However, we do retain exposure to equities alongside significant exposures to cash, bonds property and infrastructure. These asset classes are not directly impacted by share market performance. We note the crisis is evolving rapidly and we may change our allocations quite quickly. We note that within a relatively short timeframe, the pandemic will resolve itself one way or another and there will be a return to some form of normalcy.

What happens if I am still concerned?

If you are still worried here are a few steps to consider:

1.  Understand your options.  Have a look at our PDS and How we invest your money guide to find out more about your investment options.

2.  Find out where you are invested.  Log in online or look at your details on our app.

3.  Still need help with any questions during this period?  Please feel free to call the Member Services team on 1300 300 820 Monday to Friday between 8:30am and 5pm.

Face to face servicing?

Part of the advice to date from Victorian Health and Human Services Department has been to minimise, where possible, the number of face to face meetings/events. Given this backdrop, as a precautionary measure, Vision Super will be suspending all face to face meetings. This service offering has been at the heart of the support we provide you and your staff, so we regret having to take this action but think it is in the best interest of the community.

We will continue to be available on phone, website and email, and are also looking at modern technologies, video conference and live streaming to ensure we continue to support members from an education and servicing perspective.

The role of insurance

As the coronavirus continues to raise medical concerns, insurance can be an important protection for you and your loved ones. Members with death, total and permanent disability, or income protection cover through Vision Super should be comforted to know we do not have any exclusions that are relevant to coronavirus.