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What’s the difference between industry and retail super funds?

Jodie Humphries avatar
Jodie Humphries
- 4 min read
What’s the difference between industry and retail super funds?

You can build up a comfortable sum to meet your living expenses after retirement by investing regularly in a superannuation fund while you’re earning an income. When evaluating a superannuation fund, you may come across the terms industry and retail super funds. Let's see what these mean and how they differ.

Industry superannuation funds

In the past, only people employed in a specific industry could become members of that industry super fund. Today most industry super funds are open to the public. Industry super funds are usually run by trustee boards, made up of representatives from employer and employee organisations.

One of the best known industry super funds is AustralianSuper, the largest Australian superannuation and pension fund, with approximately one in every 10 Australian workers as members. Other well known industry super funds are Aware Super, HESTA, Hostplus, Rest Super, Sunsuper, and UniSuper. 

In Australia, there are over 11.3 million accounts in industry super funds and over 8.1 million in retail super funds, according to data published by The Association of Superannuation Funds of Australia (ASFA). 

Retail superannuation funds

Retail super funds are managed by banks, financial institutions or investment firms. Some retail funds you may have come across include AMP superannuation, BT superannuation, 
Colonial First State superannuation (owned by the Commonwealth Bank), MLC superannuation  and OnePath superannuation from IOOF Holdings. 

Industry vs retail super funds

You’ll want to know how industry super funds and retail funds compare before you can decide which type of fund suits your goals. 

1. Returns

Australian Government Productivity Commission’s analysis found that industry funds (not for profit funds) provided better returns to members compared to retail funds in the 13 years up to 2017. However, past performance is not necessarily an indicator of future growth, and you should evaluate the particular fund you’re considering in greater detail when you’re making a choice. 

2. How profits are used

A major difference between industry and retail super funds is how their profits are utilised. Retail super funds generate profits for their corporate owners. These profits are typically distributed to shareholders.

Industry super funds are ‘not for profit’ or ‘profit to member’ organisations. Profits generated are returned to members and not distributed to any other stakeholders.

3. Costs

Generally, industry super funds charge lower costs and fees than retail super funds, because they don't operate with a profit motive and profits are ploughed back into the fund. Industry super funds don't pay commission to financial advisors, enabling them to keep costs under control. 

Amongst the industry funds open to the public, the lowest annual fee is about $326. 
Both industry and retail super funds offer MySuper Accounts that have basic features and lower fees.

4. Membership criteria

You can invest in any retail super fund of your choice. When it comes to industry super funds, the larger ones are open to everyone. However, some of the smaller industry super funds may only be offered to people employed in that industry. For example, the HESTA fund is only for people who work in health and community services. 

5. Investment options 

Retail super funds are likely to provide you with more investment options and flexibility. That way, you’ll be able to build a more diverse portfolio than you would with an industry super fund. 

Apart from retail and industry super funds, there are other types of superannuation funds available. These include public sector superannuation funds that are generally exclusive to federal and state government employees, corporate funds that are often exclusive to the employees of the corporation offering the fund, and self-managed superannuation funds that allow you to manage your own super finances instead of a professional fund manager. Each of these options has its own pros and cons, and it’s worth learning about the different options to pick one that fits your lifestyle and financial situation.

If you find your super fund isn’t right for you or you want to change to another type of fund, it’s possible to switch to another super fund. However, you should know what to compare in a super fund. Some of the things you can look for when comparing super funds include the fees, insurance options, investments and past performance. Once you decide on the new fund, you could contact the super fund provider for the steps involved or use the government’s MyGov website to transfer your super. It’s also important that you remember to contact your employer and provide them with the necessary details when you change your super fund provider.


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Product database updated 14 Jul, 2024

This article was reviewed by Personal Finance Editor Peter Terlato before it was published as part of RateCity's Fact Check process.