BlueScope Steel Superannuation Fund

Transcription

1 BlueScope Steel Superannuation Fund Retained Benefits Division Product Disclosure Statement 1 July 2016 Contents 1 About BlueScope Steel Super p2 2 How super works p2 3 Benefits of investing with BlueScope Steel Super p3 4 Risks of super p4 5 How we invest your money p4 6 Fees and costs p5 7 How super is taxed p6 8 Insurance in your super p7 9 How to open an account p8 Helpline Monday to Friday, 8.30am 5.30pm (AEST) Website Mail BlueScope Steel Superannuation Fund Locked Bag A4010 Sydney South NSW bstlbsr@russellsuper.com Important notice About this Product Disclosure Statement (PDS) This PDS provides a summary of the key information you need to make a decision. It includes links to additional information that is part of this PDS marked with a. This is important information you should read before making a decision to invest in the BlueScope Steel Superannuation Fund (BlueScope Steel Super). The information provided in the PDS is general information only and doesn t take account of your personal financial situation or needs. You should obtain financial advice tailored to your personal circumstances. If you would like a free paper copy of the this PDS, or the additional information, please contact the Helpline.

2 1 About BlueScope Steel Super BlueScope Steel Super is a corporate superannuation fund, with over $1.65 billion dollars in assets under management and over 6,700 members. As a member, you have access to competitive fees, four investment options, option to purchase death insurance, super for your spouse, leading member services and financial advice. To help you understand your benefits and make informed decisions the Fund offers you a website, phone helpline, communication materials, education seminars and access to financial advice and licensed advisers. BlueScope Steel Super (the Fund) is a superannuation fund that has a number of divisions: Defined Contribution (DC) Division For new BlueScope employees. Members in the DC Division have a super account that operates much like a bank account where deposits (i.e. contributions or rollovers) are made to the account and taxes, fees and insurance premiums are deducted. Investment earnings are applied to the account based on the returns (which can be positive or negative) of the member s chosen investment option. Retained Benefits Division For former employees of BlueScope to keep their super with the Fund and continue to enjoy the many benefits of membership. Spouse Account Division For spouses of BlueScope employees to also establish superannuation savings and enjoy the benefits of membership of the Fund. The Fund does not offer a MySuper product. Visit for the information the Trustee is required to disclose including their remuneration. The Trustee is required to transfer any of your account balance that is an Accrued Default Amount to a MySuper product by 1 July 2017, unless you elect to leave it in the Fund. We will communicate with all affected members prior to this date. This Product Disclosure Statement (PDS) is produced by the Trustee of the Fund, Total Risk Management Pty Ltd (TRM), ABN TRM s Australian Financial Services Licence (AFSL) number is The BlueScope Steel Superannuation Fund ABN is How super works Superannuation is a means of saving for your retirement that is, in part, compulsory. There are different types of contributions available (for example, contributions by your employer, contributions that you choose to make and Government co-contributions). There are also limitations on contributions to, and withdrawals from, superannuation. Most people have the right to choose into which superannuation entity their employer should direct their Superannuation Guarantee contributions, but in some cases your super fund may be determined by the terms of your employment. If you aren t able to choose your super fund or don t tell your employer where to pay your super they will put it into the super fund that they ve chosen for you. As BlueScope Steel Super does not offer a MySuper product the Fund cannot accept contributions into a member s Retained benefits Division Account unless the member has provided an investment choice direction. To make a contribution you need to complete the Additional Voluntary Contribution (AVC) Lump Sum Payment Form and submit it with your contribution. Tax savings are provided by the Government. In Australia, superannuation investments receive special tax concessions that aren t available to other types of investments. That s why super is such a powerful vehicle to save for retirement. As your super is likely to be one of your biggest assets in retirement, the choices you make today can have a significant impact on your lifestyle in your retirement. You should read the important information about How super works before making a decision go to and access Retained Benefits Division IBR through Information/Forms > Publications > Product Disclosure Statements. This material relating to How super works may change between the time when you read this PDS and the day when you join the Fund. 2 BlueScope Steel Superannuation Fund Retained Benefits Division

3 3 Benefits of investing with BlueScope Steel Super Key features of your membership As a member of BlueScope Steel Super (the Fund), you automatically receive a range of benefits as outlined below. If you choose another superannuation fund, these benefits may not be available. Your benefit in the Fund is a defined contribution benefit. All contributions and positive investment earnings are credited to your account. Any fees, tax, insurance premiums and negative investment earnings are debited from your account. You need to choose how your account is invested from the range of investment options offered through the Fund. If you have death insurance cover, in the event of your death while a member of the Fund, you will be entitled to an insured benefit, in addition to your account balance (provided you satisfy any eligibility conditions for provision of insurance). Key benefits offered through the Fund BlueScope Steel Super provides a range of great benefits and competitive fees for members of the Fund. Competitive fees through the Fund you have access to competitive investment and administration fees generally not available to individual investors. Investment choice you can choose from a range of four investment options across different asset classes. You can switch your investment options when needed, daily switching is available. Insurance you have access to death cover to protect you and your family when you need it most. Fund communications you have access to a range of communications including newsletters, fact sheets, the annual report, and annual benefit statements to better understand your benefit in the Fund and to help you make informed decisions about your super. Calculator available online where you can consider and model outcomes using your specific circumstances. General advice over the phone you can receive free general advice via the helpline SuperConnect. If you need more detailed advice, we can refer you to a licensed financial adviser. Personal financial advice A qualified, professional financial adviser can help you learn more about super and ensure you are on track to meeting your financial goals. If you do not have a financial adviser call our Helpline and we can refer you to one who is trained on the features and benefits of BlueScope Steel Super. Our website ( houses a wealth of useful information. It gives you access to your account details and investments, which you can update and change at any time. You can also explore our general superannuation and investment information and experiment with an investment quiz or calculator. Seminars you can attend education seminars to assist you in understanding your benefit and making the most of your super. Policy Committee there is a Policy Committee comprising BlueScope employees that monitors the Fund s operations and represents your interests as a member of the Fund. You should read the important information about the Benefits of investing in BlueScope Steel Super before making a decision go to and access Retained Benefits Division IBR through Information/ Forms > Publications > Product Disclosure Statements. This material relating to Benefits of investing with BlueScope Steel Super may change between the time when you read this PDS and the day when you join the Fund. BlueScope Steel Superannuation Fund Retained Benefits Division 3

4 4 Risks of super This section outlines the risks that are relevant to investments generally, as well as the significant risks that are relevant to your membership of BlueScope Steel Super. There are a number of other investment related risks that may affect particular investments, but these are not considered to be significant in relation to any of the Fund s investment options. However, in particular market conditions, these risks may have some impact on the investment returns, value or liquidity of one or more of the investment options offered by the Fund. Risks associated with superannuation investments All investments carry some level of risk. Super funds invest in a range of asset classes - for example, cash, bonds, property and shares that have different levels of risk, and offer a variety of investment options reflecting different weightings of these asset classes. The likely investment return, and the level of risk of losing money, is different for each investment option depending on the underlying mix of assets. Those assets with potentially the highest return over the longer term also have the highest risk of losing money in the shorter term. Growth assets, like shares and property, have relatively higher risk and higher expected return, than defensive assets, like fixed interest and cash. The appropriate level of risk for you will depend on a range of factors including your age, investment time frame, where other parts of your wealth are invested, and how comfortable you are with the possibility of poor or negative returns from time to time (that is, your risk tolerance). When considering your investment in super, it is important to understand that: the value of your investment will go up and down; the level of your investment return will vary; investment returns are not capital guaranteed, therefore you may lose some of your money; past returns are not indicative of future performance; your super savings (including contributions and returns) may not be enough to provide you with an adequate income for your retirement; and the laws relating to superannuation may change during the life of your investment and this might affect your final benefit, as well as how and when it is paid. To manage your risks, you should obtain professional financial advice that is tailored to your investment objectives, financial situation and particular needs. It is also important to remember that your risk tolerance may change as you get older. When assessing which options to invest in, we recommend you pay particular attention to the investment return objective, suitability, minimum investment timeframe, investment strategy and risk levels sections given for each investment option. Other risks associated with your membership in the Fund As with any superannuation fund, the Fund s rules or management may change and this may impact your membership, benefits you receive and fees that you pay, either in a positive or negative way. 5 How We Invest Your Money BlueScope Steel Super offers members four investment options to choose from. Each one has a different level of risk and potential level of returns. WARNING: You should consider the likely investment return, risk and your investment time frame when choosing which option to invest in. As outlined in Section 2, you cannot contribute to your BlueScope Steel Super Retained Benefits Account unless you have made an investment choice, telling us how your contributions and account balance are to be invested. You can choose up to two investment options. You can also vary the percentages that apply to your current benefit and your future contributions. To make an investment choice, you need to nominate the percentage of your current benefit and/or future contributions that you want invested in your chosen option(s). If you are a former Defined Contribution Division or Spouse Account Division member, your benefit will continue to be invested in the option(s) that applied to your benefit immediately before it was transferred to the Retained Benefits Division. If you are a former Defined Benefit Division member, your defined benefit will be invested in Option A on transfer to the Retained Benefits Division, until you make an investment choice. Any accumulation accounts will continue to be invested in the option(s) that applied to your benefit immediately before it was transferred to the RBD. You can change your investment option at any time, the Fund offers daily switching. The Fund s investment options and target asset allocations Option A 100% defensive assets Option B 60% defensive assets / 40% growth assets Option C 30% defensive assets / 70% growth assets Option D 10% defensive assets / 90% growth assets Information about Option C is set out in the following table. Information about the options is set out in the IBR document. You should read the important information about How we invest your money, which has details on each of the investment options, before making a decision go to and access Retained Benefits Division IBR through Information/Forms > Publications > Product Disclosure Statements. This material relating to How We Invest Your Money may change between the time when you read this PDS and the day when you join the Fund. 4 BlueScope Steel Superannuation Fund Retained Benefits Division

5 The Fund s Option C in more detail Option C Investment return objective: To earn a return after expected costs and tax, exceeding CPI* by 3.5% per annum, measured over rolling 5 year periods. Suitability: Suitable for investors who are seeking to build wealth over the medium to long term and are willing to accept the possibility of negative returns over the shorter term. Minimum investment timeframe: Be prepared to stay invested in this option for at least 5 years before it meets its objectives. Investment strategy: The option is typically exposed to a diversified portfolio mix of growth investments around 70% and defensive investments around 30%^. The option may be exposed to derivatives. Estimated Investment fee: 0.45% p.a. Risk level**: Short-term risk is the risk that your super savings will be reduced by volatility of investment markets.. Long-term risk is the risk that a member s superannuation savings will not significantly outperform inflation over a member s superannuation accumulation lifetime. Risk level for the time invested Length: Short Long Risk: High Low Estimated number of negative annual returns over any 20-year period: Approximately 4 to 5 Asset allocation ranges # : Enhanced cash 10.5% 14.5% Fixed Income 14.5% 20.5% Property 6% 10% International Equities 28% 36% Australian Equities 28% 32% * CPI stands for Consumer Price Index, which is used as a measure of inflation. 6 Fees and costs Did you know? Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns. For example, total annual fees and costs of 2% of your fund balance rather than 1% could reduce your final return by up to 20% over a 30 year period (for example, reduce it from $100,000 to $80,000). You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. Your employer may be able to negotiate to pay lower administration fees. Ask the fund or your financial adviser. To find out more If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website ( has a superannuation calculator to help you check out different fee options. It can also be used to calculate the effect of fees and costs on account balances. This table shows fees and other costs that you may be charged in respect of Option C. The information can be used to compare costs between different superannuation products. These fees and costs may be deducted from your account, from the returns on your investment before the unit price is set or from the assets of the investment option as a whole. Type of fee Amount How and when paid Investment fee* Administration fee Buy-sell spread 0.45% p.a. of your account balance Investment fees are deducted from investment returns before the unit price is declared and are not deducted from your account. 0.70% p.a. It is deducted from your account monthly with a maximum fee of $2,000 p.a. No administration fee applies for the first two calendar months of your RBD membership unless you have transferred from the Spouse Division. In which case the fee will apply from the date of your transfer. Nil for your first 5 investment switches in one financial year; 0.20% of the switched amount on any subsequent switches. Switching fee Nil Not applicable Exit fee Nil Not applicable Advice fees Nil Not applicable You can make 5 investment switches per financial year without being charged a buy-sell spread. The fee applies on the 6th and any subsequent switches that you make and is deducted from your account at the time of the switch. ^ Please refer to the asset allocation ranges for details of the parameters surrounding the investment strategy. ** The risk level is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be, nor the potential for a positive return to be less than the return an investor may require to meet their objectives. # The actual asset allocation may temporarily fall outside the ranges stated above in certain circumstances, such as asset transitions or extreme market movements. Other fees and costs Indirect cost ratio (ICR) $250 per request Family Law fees are payable for information requests. You can read more about these fees in the Additional Explanation of Fees and costs section of Retained Benefits Division-IBR. Nil These costs are deducted from investment returns before the unit price is declared and are not deducted from your account. * The Investment fee varies according to the Option you invest in. The quoted fee here is for Option C and includes a performance fee. BlueScope Steel Superannuation Fund Retained Benefits Division 5

6 Example of annual fees and costs for Option C The table below provides an example of how the fees and costs in Option C of BlueScope Steel Super can affect your superannuation investment over a one year period. You should use this table to compare this product with other superannuation products. Example: Option C Investment fees: PLUS administration (contribution) fees: EQUALS cost of product: * Additional fees may apply. Changes in fees Balance of $50,000 with a contribution of $5,000 during the year 0.45% p.a. For every $50,000 you have in the balanced investment option you will be charged $225 each year. 0.70% p.a. For every $5,000 you put in the Fund you will be charged $35 per year in administration fees. If you had a balance of $50,000 at the beginning of the year and had additional contributions of $5,000 during the year, you would be charged fees of $260. What it costs you will depend on the investment option you choose. The Trustee has the right to change BlueScope Steel Super s fees at any time, without your consent. Any material increase in the fees you are charged will be communicated to you at least 30 days before it occurs. You should read the important information about Fees and costs before making a decision go to and access Retained Benefits Division IBR through Information/Forms > Publications > Product Disclosure Statements. You should also read the definitions of Defined Fees. Refer to the Additional Explanation of Fees and Costs in section 6 of the IBR. These definitions can also be found at feeandcostdefinitions This material relating to Fees and costs may change between the time when you read this PDS and the day when you join the Fund. 7 How super is taxed Superannuation is one of the most tax-effective ways to save for retirement. Even so, taxation laws are complex and subject to change. To make the most of your superannuation, you might like to consult your accountant or tax adviser for specific details about how you will be taxed. This advice may be particularly useful as you approach retirement and need to decide how and when to withdraw your super. Contributions Concessional contributions, also known as before-tax contributions, include all contributions made from your before-tax salary, including salary sacrifice contributions and employer contributions. Concessional contributions are taxed in the Fund at 15%^. Non-concessional contributions, also known as after-tax contributions, are contributions made from after-tax money. Non-concessional contributions cannot be accepted by the Fund if your Tax File Number (TFN) has not been provided to the Fund by you or your employer. If the Fund receives a non-concessional contribution and if we have not received your TFN within 30 days from the date of receipt of the contribution, we must return it. Excess contributions tax There are limits, set by legislation, on the amount of superannuation contributions that are taxed at a concessional rate. If you make contributions in excess of these limits, you will have to pay additional tax. Concessional contributions are taxed in the Fund at 15%^. If your contributions exceed the concessional limit, the excess contributions will be included in your assessable income see below for more information. No tax is payable by the Fund on non-concessional contributions. However, if your non-concessional contributions exceed the relevant contribution limit, you will have to pay excess contributions tax. To see current contribution limits visit au/contributions to super Concessional (before-tax) contribution limit: If you exceed your concessional contribution limit, excess contributions will be taxed at your marginal tax rate plus the Medicare levy plus any applicable excess concessional contribution charge. These excess concessional contributions will also count towards your non-concessional contribution limit. For the financial year ending 30 June 2015 and onwards you will be able to elect to have up to 85% of the excess contributions released from the Fund to avoid having them count towards your non-concessional limit. Non-concessional (after tax) contribution limit: In the 2016 Budget it was stated as of 3 May 2016, the after-tax contributions limit is set at a lifetime limit of $500,000. This cap takes into account all after-tax contributions made since 1 July It applies to individuals aged up to 75 years. If you make a contribution over your lifetime cap the Australian Tax Office will ask you to withdraw the excess. If you choose not to withdraw the excess you will be subject to penalty tax. ^ High income earners may pay a further 15% tax. Refer to our fact sheet Division 293 Tax : Understanding how your super is taxed. 6 BlueScope Steel Superannuation Fund Retained Benefits Division

7 If you exceed your non-concessional contribution limit, excess contributions will be taxed at the top marginal tax rate plus Medicare levy. If you are under age 65 on 1 July in a financial year, you can bring forward two years contributions giving you a higher limit. The bring forward rule for non-concessional contributions can only be used once every 3 years. It is important to note that once you have exercised the bring forward rule you can t do it again for the following two years. If you are considering making contributions in excess of the annual non-concessional contribution limit, please call SuperConnect to obtain further information about how the bring forward provision operates. WARNING: If you exceed your Concessional Contribution limit, excess contributions will be taxed at your marginal rate plus Medicare levy. These excess Concessional Contributions will also count towards your Nonconcessional Contribution limit. If you exceed your Non-concessional Contribution limit, excess contributions will be taxed at the top marginal rate plus Medicare levy. Investment earnings Investment earnings in superannuation are taxed at a maximum rate of 15%. The investment return we disclose to you is net of tax. Withdrawals Tax on withdrawals varies depending on your age, the type of withdrawal, and the ratio of taxable to tax-fee components in your account. We withhold appropriate tax from amounts we pay to you. WARNING: You should provide us with your Tax File Number (TFN) when you become a member of the Fund. If you or your employer does not provide the Fund with your TFN, all Concessional Contributions will be taxed at the top marginal rate plus Medicare levy and you cannot make after-tax (Non-concessional) contributions. Tax will be withheld at the top marginal rate plus Medicare levy on the taxable component of any payment made to you. 8 Insurance in your super Insurance is an important benefit designed to protect you and your family when you need it most, so it s important you have adequate cover for your own personal circumstances. If you were a member of the Defined Contribution Division (DCD) and transfer to the Retained Benefits Division (RBD), you will automatically receive death insurance cover in the RBD. You will retain the number of units of insurance cover that you had in the DCD immediately prior to joining the RBD. If you were a member of the Spouse Division, you will automatically retain the number of units of insurance cover (if any) you had in the Spouse Division. If you did not have cover, you can apply for this when you join the RBD. Death insurance cover is purchased in units and each unit of cover will cost $0.78 per week, or $40.56 per year. For example, if you are currently age 40, and have 3 units of cover, this will provide cover of $181,800, at a cost of $ p.a. The value of each unit decreases as you get older. You are able to purchase additional death insurance cover. The insurer will require you to complete a medical statement and possibly take a medical examination and the insurer has the right to decline or limit your cover. You can cancel, reduce, or apply to increase your cover at any time by calling the Fund Helpline. The level of death and TPD cover available to you for each unit of cover Age next birthday Cover Age next birthday Cover 35 (or less) $132, $16, $117, $14, $102, $12, $89, $10, $74, $9, $67, $8, $60, $7, $54, $6, $47, $5, $42, $4, $37, $4, $32, $4, $28, $3,900 You should read the important information about How super is taxed before making a decision go to and access Retained Benefits Division IBR through Information/Forms > Publications > Product Disclosure Statements. 48 $25, $3, $21, $2, $19, and over $0 This material relating to How super is taxed may change between the time when you read this PDS and the day when you join the Fund. BlueScope Steel Superannuation Fund Retained Benefits Division 7

8 WARNING: Unless you cancel any automatic death cover, the cost of this cover will be deducted from your account in the RBD. You should read the information contained in section 8 of the IBR document, before deciding whether this insurance is appropriate for you. This information also explains who is eligible for insurance cover and the conditions and exclusions that apply. This may affect your entitlement to insurance cover so the information should be read before deciding whether the insurance is appropriate. You should read the important information about Insurance in your super before making a decision go to and access Retained Benefits Division IBR through Information/Forms > Publications > Product Disclosure Statements. This material relating to Insurance in your super may change between the time when you read this PDS and the day when you join the Fund. 9 How to open an account How to apply When you leave BlueScope your benefit will be automatically transferred to the Retained Benefits Division. If it is $2,000 or more you are eligible to to remain a member of the RBD for as long as you choose. If you are a former Defined Contribution Division (DCD) member your benefit will continue to be invested in the same investment option that applied to your account immediately before it was transferred to the RBD. If you are member of the Spouse Division you can notify the Trustee that you want to move to the Retained Benefits Division by completing a Benefit Payment Application Form. Your benefit will continue to be invested in the same investment option that applied to your account immediately before it was transferred to the RBD. All new RBD members should complete a Nomination of Dependants Form if you wish to update your nominated beneficiaries. You should also take this opportunity to review the level of your death insurance cover. Enquiries or complaints If you have any questions that are not answered in this PDS, please call our Helpline. If your enquiry is not resolved to your satisfaction and you wish to lodge a complaint, please contact us: By mail Enquiries and Complaints Officer BlueScope Steel Superannuation Fund Locked Bag A4010 Sydney South NSW 1235 By bstlbsr@russellsuper.com By telephone Depending on the nature of your complaint, we may ask you to provide further information in writing, so that we can fully understand the complaint. We will provide assistance to you if necessary and a prompt written acknowledgment of receipt of your complaint. Our goal is to handle your complaint efficiently and fairly and we will provide the Trustee s decision as quickly as possible. However, if your complaint relates to a death claim or to a declined disablement claim, it may take some time to gather all the information necessary to enable the complaint to be properly considered. You can obtain advice in relation to the complaints handling process or feedback on the status of your complaint by calling us. If our enquiry and complaints procedure does not resolve the issue within 90 days, you may be able to take the matter to the Superannuation Complaints Tribunal. The Superannuation Complaints Tribunal is an independent body established by the Federal Government to assist members and their beneficiaries with certain types of complaints. The Tribunal can be contacted at: By phone By info@sct.gov.au By mail Superannuation Complaints Tribunal Locked Bag 3060 Melbourne VIC BlueScope Steel Superannuation Fund Retained Benefits Division BSS_PDS_SF_RBD_V1F_1606