Russell Investments launches GoalTrackerTM

Russell Investments has just launched GoalTrackerTM - a highly customizable and personalised superannuation solution using proprietary algorithms to tailor investment solutions for users of its Russell Investments Master Trust (RIMT). It has been rolled out to 50,000 members of the RIMT as the MySuper option.

Tim Furlan, Russell Investments head of super, explains that the solution has been in the works for nearly a decade.

"It takes a while to build these things. It started a few years ago as a concept we were batting around with our US and UK offices," he says.

The development process

While the US went ahead and built a product, at the time in Australia there were other issues that took the business' attention, like the new MySuper regulations.

But the business here came back to it around two years ago. The product's development began then, after an initial education period.

"In terms of the actual development process there is a whole lot of education because it is a new and innovative product. So we spent lots of time with our own team explaining the concept," Furlan says.

"We spent a lot of time with our trustee. At the end of the day what we are trying to do here is something we believe is going to benefit members".

The legal process was also intensive as the product was a totally new concept and the legal team needed to make sure that it complied with all the relevant legislation.

There was then an intensive testing process that at some points involved a developer sitting down one-on-one with a member as they navigated through the different tools.

"We went through an extensive process of testing things with members particularly around the user interface," Furlan says.

How it works

If an investor in GoalTracker does nothing the product will invest using an age-based investment cycle. But all members are prompted to enter more information about their individual circumstances to enable a tailored solution.

That information encompasses issues such as whether or not the member has more than one superannuation account, what investments they have outside of super and their contribution levels.

The next level of queries drills down into how members expect to spend during retirement.

"We show them eight spending areas. Things like what sort of holidays do you want to go on, how much do you want to spend on healthcare and the like," Furlan explains.

They then have five different spending levels to choose from. Once the questions are completed the member has the opportunity to correct anything they don't agree with and then they get a dial, which shows them how they are tracking towards achieving their retirement goals.

They are then asked for consent to use that data to create an investment plan. They will receive a statement of advice for this limited investment plan, which focuses on asset allocation, and which Furlan stresses is not full financial advice.

The cost

There is no extra cost to users for the service.

"It's all in our MySuper product and you don't pay any extra to get that personalised," Furlan says.

Russell expects to recoup their investment in the product through other corporates and funds signing up to their master trust and have already had some business wins as a result of the launch.

The product is not personalised down to the stock level at this point but Furlan says future iterations of GoalTracker are likely to give people the option to express their ESG preferences as well.

"We do expect this to be the super of the future. We do think that this is the way the world is going to go," he says.