30th Apr 2018
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Australian super funds suffer second monthly decline in returns
Australian super funds suffer second monthly decline in returns

Australian super funds have suffered their second consecutive monthly decline in returns, with global market volatility shaking up the industry in a way that hasn’t been seen in 10 years.

But there is some news, with median balances well ahead for the financial year to date, compared with last year.

With this in mind, superannuation remains one of the best investments over the last decade.

Super funds that invest in Australian shares only have been hit hardest, with a -3.1 per cent decline in returns over March.

Balanced options had interim returns of -0.7 per cent, with members in a growth option copping a -1.1 per cent fall.

However, super members with a balanced option are still ahead so far this financial year, with overall growth of 5.7 per cent and a rolling one-year average of eight per cent.

Median balanced options have returned 5.9 per cent a year, meaning, $100,000 invested in 2008 would now be worth $171,335.

The report shows that being in the right fund makes a major difference, though, with the best-performing funds outperforming the worst by more than $50,000 over a 10-year period.

SuperRatings Chief executive Kirby Rappell says that despite the ups and downs of super, it remains one of the best investment strategies around, but Australians may have to get used to volatility.

“That latest market turmoil has had a short-term impact on super returns,” said Mr Rappell.

“However, it remains overwhelmingly the case that superannuation continues to deliver strong returns to members over the medium to long term and is one of the most important sources of wealth for Australians.”

“Volatility is undoubtedly emerging as the new normal, presenting an environment that many super members have not experienced in a decade. This volatility needs to be managed but no one should lose sight of the fact that super continues to deliver strong returns.”

SuperRatings data shows the top 10 performing funds over the past10 years.

 

How has your fund performed? Have you become used to smooth-sailing super? Will you ride out this storm or switch your investments?

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    COMMENTS

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    FrankC
    30th Apr 2018
    11:55am
    When you say '2008' I presume you mean post GFC as pre would have had $25K wiped off that $100K. I'm basing that on the fact that I lost 25% of my balance at GFC time
    Not a Bludger
    30th Apr 2018
    12:06pm
    This is what happens when the constantly outraged insist on non-stop bank bashing.
    Rae
    30th Apr 2018
    1:28pm
    Yes. Just wait until something stuffs up the current account and all that foreign debt blows up. I wouldn't hold bank hybrids now for any amount of yield as the risk is too high.

    The banks should never have been deregulated and we wouldn't be in this mess.
    KSS
    30th Apr 2018
    12:12pm
    More scaremongering here.

    Superannuation is not now, nor has it ever been, a short term investment. Panicking over a month to month result is irresponsible. I don't remember seeing the positive reporting on a month to month bases for the 10 months prior to the last two when the results were in the positive!
    Rae
    30th Apr 2018
    1:32pm
    It is not an investment but a tax minimisation scheme. returns will depend on asset selections and market performance.

    Returns have been okay. Overseas sharemarkets are now bouncing back. Interest rates will rise. I'm not positive about the ASX because we are well overdue the corrections we avoided in 2008.
    Tib
    30th Apr 2018
    12:36pm
    A couple of months , sorry didn't notice.
    Old Man
    30th Apr 2018
    12:47pm
    This article is very misleading. The comparisons shown are not true comparisons in that they don't show the return of the total funds invested. There appears to be a part of each fund shown as it refers to "growth" or "balanced" when no super fund has only those types as the total fund. All funds have a combination of Growth, Balanced, Cash and Property so it would be nice if each of the funds mentioned were to show the overall percentage of profit, not just the bit that did well.
    Rae
    30th Apr 2018
    1:35pm
    The article also suggests Superannuation is an investment class when it is actually a tax minimisation saving scheme. Returns will depend on asset s held as you suggest.
    Radish
    30th Apr 2018
    2:55pm
    Having superanuation saves the taxpayer having to fund me in my retirement.

    Paul Keating was the one who deregulated the banks
    Old Geezer
    30th Apr 2018
    9:15pm
    Super is just a way of saving money that has some tax benefits in exchange for not being able to access your money until the rules allow you.

    30th Apr 2018
    2:56pm
    IGNORE !
    Misty
    30th Apr 2018
    6:37pm
    We lost 25% of our super investments in the GFC also.
    Tib
    30th Apr 2018
    8:35pm
    I made $100000. Bad planning on your part.
    Old Geezer
    30th Apr 2018
    9:14pm
    I did OK out of the GFC too. Just buy when shares are low and sell when they are high. Many people held onto over valued shares and then panicked and sold them at their lowest price. I can't understand why people gladly shop for bargains but do the opposite when investing. Makes little sense to me.
    Misty
    1st May 2018
    10:16am
    Our super was in a managed fund by a Finacial Planner.
    Adrianus
    1st May 2018
    10:42am
    Misty, did your fund recover from that loss? Or was it permanent?
    Old Geezer
    1st May 2018
    11:02am
    My super was managed by yours truly.
    Misty
    1st May 2018
    10:33pm
    Never fully receovered, is with MaCQuarie Bank.


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