Research finds younger Australians with lower balances switching to SMSFs

Switching between super funds has accelerated sharply over the past 12 months and many younger members with lower balances are moving into SMSFs, new research has found.

The Super Members Council released data that indicates switching between super funds has risen by 17 per cent over the past year and it is now not older retirees with high balances moving money to coincide with changes in life circumstances but younger members that are dominating the statistics.

The research found that In 2024–25, 68 per cent of Australians who were switched out of five large, high performing, safe, profit-to-member funds into for-profit platform-based super funds had less than $100,000 in super, and 80 per cent had under $200,000. 

A similar pattern is occurring among Australians with limited amounts of super being switched into SMSFs, with more than half having under $100,000 in super, and three in four less than $200,000.

More than 70 per cent of those platform switchers and 61 per cent of those SMSF switchers held under $100,000, with an average super balance of just $21,700.

Seven in 10 members switching did not have a pre-existing advice relationship, suggesting this activity could potentially be being driven by social media ads, lead generation or third-party influences and not by long-term professional financial planning in their best financial interests.

The patterns in this switching data suggest the potential effect of other influences – especially for young people with small balances and a high number of people without a pre-existing trusted advice relationship.

The SMC stated these patterns should be ringing alarm bells for both regulators and policymakers in the wake of the Shield and First Guardian collapses.

“Cold‑calling, lead‑generation funnels and sales tactics are a cause for significant concern, especially for consumers with limited financial literacy or confidence,” it stated

“The government has made it clear consumer protections are on the way. Anything less than a comprehensive set of consumer safety reforms will fall short.”

The SMC has said it wants the government to remove any conflicts of interest – including eradicating any hidden paydays – wherever they arise in the chain of complex entities across super, investment vehicles and advice, and strengthened safety obligations on any process that involves switching a person’s super.

“There also needs to be a ban on aggressive selling tactics through social media ads and cold calls by expanding anti-hawking laws to prevent contact aimed at generating or transferring leads for personal financial advice or super,” it said.

“The response must ensure any switching decisions are always safe, informed, and absolutely in the members’ interests.”

Keeli Cambourne

March 3 2026

smsfadviser.com