High-pressure sales tactics are putting your super savings at risk.
If someone you don’t know contacts you about your super – hang up. They are not looking out for you.
You may have clicked on an advertisement, filled out a form on a super comparison website, or you may not have taken any action at all. Callers can get your data from their own sources, or they might purchase your data from a third party.
Learn what to watch out for, how to avoid pressure and how to protect your super.
When to pause or hang up the phone
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Sales calls about your super
If someone calls about your super, be cautious. They may offer a free ‘super health check’ or to find your lost super. These can be sales tactics designed to steer you into switching – even when your super fund is performing well.
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Claims your fund is underperforming
Callers may start talking to you about your fund, claiming your fund is underperforming. They often exaggerate problems to make you want to switch. Check with your fund directly if you’re unsure.
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Discuss solutions for your super without speaking to an adviser
Be wary when sales agents discuss your super fund with you. They may start to collect your personal information and may not be qualified to give financial advice about your super.
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Offers of better returns
If someone offers you better returns and to roll your super into a super fund they recommend, you may end up in a fund with higher risks and higher fees. Super is a long-term investment and not a shortcut to quick gains.
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Minimal contact with a financial adviser
The caller may act as the facilitator between you and the adviser. If you’re not having direct, in-depth conversations with the financial adviser, they may not be acting in your best interests.
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Pressure to act now
If you’re being rushed to make quick decisions or sign documents, push back and take time to stop and think. Super decisions do not need to be rushed.
What can you do?
If someone you don’t know contacts you about your super, it’s a red flag. Your super is too important to discuss with strangers.
When you get a call like this:
- hang up – don’t explain, don’t engage
- block the number – and join the do not call register
- report it to your super fund – if you have given out personal information, call your current super fund and tell them so they can block withdrawals
- talk to someone you trust – such as your family or friends, or a financial counsellor
It is also a good idea to report the call to ASIC.
Why sales agents want your super
Typically, these promoters may want you to move your savings to schemes that benefit them – not you.
Some things they might try to push you into include:
- Switching to a different super fund – they will charge fees to your super fund for providing advice, and they may want your money in a fund they earn money from.
- Setting up an SMSF – they want to charge you set up and admin fees – even if an SMSF is wrong for your needs.
- Financial products – they may be profiting from investing your super into a financial product such as a high-risk property scheme.
During the sales call, the caller may transfer you to a licensed financial adviser. This is a tactic to show they are legitimate, but they will pass back to the salesperson to collect information, provide the advice and close the deal.
What are the risks for this kind of financial advice
This kind of advice does not:
- adequately assess your needs – your financial situation or your goals
- balance risk – you may be placed into a higher risk investment or property scheme, or a self-managed super fund that is not suitable for you
- check your understanding – limited opportunity in the process to read the advice, ask questions, and often an expectation to make a quick decision in the same phone call
This kind of advice may:
- erode your super balance – through higher fees and charges, and high-risk investments
- cause you to lose existing insurance that is attached to your current super
Tricks of high-pressure sales tactics
High pressure sales tactics work because they play on human instincts.
It’s normal to feel uncertain, out of depth or under pressure – especially when it comes to money.
But that’s exactly what they are trying to exploit.
Fear of missing out
We all want to make the most of our retirement savings. Promoters play to your fear that time is running out and you may not have saved enough.
Catastrophe threats
Promoters may tell you things will go wrong if you do not act – telling you decisions are urgent when that’s rarely true.
Hope for more
We all want better investment returns and more money. But unrealistic promises are just a way to lure you in. Past performance is not a reliable indication of future performance.
Guilt
You might feel rude for hanging up, pushing back or saying no. They know that – and play on your discomfort.
Social pressure
It’s easy to feel like you should be capable of making quick decisions. But financial matters are complex and it’s best to take your time.
Trust in advice
Promoters will often sound confident and well-informed to win your trust. They may give you brief access to a financial adviser, but don't give you time to consider if the advice really meets your needs.
Learn how to avoid high-pressure sales tactics.
How to take charge of your super
Consider getting financial advice
Financial advice can help you make informed decisions about your super and investments. Shop around and choose a financial adviser you feel comfortable with.
Many super funds offer financial advice about saving for retirement as part of your membership. Comprehensive personal advice may also be available – with fees often payable from your super.
If you decide you do want to change super funds
Most people can choose their super fund. If you decide you do want to switch, choosing a super fund has more information.
Be wary of investment hype
If it sounds too good to be true, it almost always is. Super is a lifetime investment and higher returns come with higher risk.
See investment warnings for more information.
Talk to your current super fund
Contact your super fund for information about your current super investment options, risk profiles, past performance, and fees.
Find your lost super
You can find your lost super yourself for free.