WRAP accounts 101
Written by Glen James
Host of the Retire Right& money money money (formerly my millennial money) podcasts & author of The Quick-Start Guide to Investing.
There’s been some chatter in the Facebook group about WRAP accounts, so I sat down with Vince Scully to unpack them: what they are, who they’re for, and whether they’re worth the extra cost.
What is a WRAP account?
A WRAP account, sometimes called an IDPS (Investor Directed Portfolio Service), is like a super account with more flexibility. Instead of a one-size-fits-all approach like most industry funds, a WRAP account lets you and your adviser customise how your money is invested.
You can:
Choose specific managed funds, ETFs, or direct shares
Set and automatically rebalance your own investment mix
See all your investments in one place with consolidated reporting
It ‘wraps’ everything into one account for simplicity, hence the name.
Why do people choose them?
WRAP accounts are often used by financial advisers when someone has a larger balance and more complex needs, like wanting to minimise tax, control asset allocation, or build a tailored retirement income strategy.
Yes, they can cost a bit more than a typical industry super fund, but in many cases the flexibility and tax advantages can outweigh those extra fees, especially if you’re:
✔️ more than 5 years from retirement
✔️ sitting on a super balance of $50k+
✔️ looking for more control or have specific or complex needs
That said, not everyone needs one, and not every adviser recommends them. There’s a lot of noise (and misinformation) online, so this episode is all about cutting through the confusion and helping you understand what’s actually going on.
🎧 Listen to the episode now
📺 Or watch the full conversation on YouTube
Community question
Community member says: For as long as I can remember the thought of money has always been stressful. We didn’t have much growing up, and my parents struggled to keep food on the table. Now as an adult getting closer to retiring, I feel this constant anxiety about money, wondering if I’ll have enough super, worrying about rising costs, and it’s led to a situation where money has always had negativity attached to it. Any ideas on how to change this?
Glen says: I feel for you! When there’s been money stress it can really impact your wellbeing. My first point would be to seek professional support with your GP if you are ready and feel that counselling of some kind would be helpful. Mental health and health is our greatest asset!
From there I’d love to introduce the concept of money mindset to you. It is essentially the set of beliefs you carry about money, influenced by what you observed and experienced as a child. Whether you saw your parents managing finances with ease or struggling to make ends meet, these early experiences impact how you handle money as an adult. As we move through life, these money beliefs often become more ingrained. When finances are tight, the sense of scarcity can make us overly cautious, while having an abundance might lead to careless spending without structure. These attitudes don’t simply fade away; they can influence how we manage our finances well into retirement.
You might struggle with using your hard-earned superannuation funds, torn between the fear of depleting your savings and the temptation to spend freely without limits. Take this chance to reflect on how the money beliefs from your past are shaping your approach to retirement finances now.
In the blog below there are 3 exercises you can try to start reshaping your money mindset. It’s never too late to change the way you view and feel about money. I’d encourage you to read it and give these exercises a go:
