Many Australians depend on their superannuation for financial security and wellbeing during the retirement phase. But the selection process can be complex, requiring future retirees to assess various factors. These include:
Ultimately, the most important consideration is performance. A fund’s past performance, while not an indicator of its future performance, can serve as a guide for prospective members. In particular, a fund’s ability to consistently deliver strong returns for members over a long-term investment horizon should form part of the decision-making process.
Australia’s superannuation industry has over-performed since its inception over 30 years ago. According to APRA data, super funds have collectively delivered positive investment returns for 26 of 31 financial years, with an average ROA of 7.8 per cent – well above the long-term target of 6 per cent. Over the latest reported financial year (2022–23), super funds delivered a return of 9.2 per cent.
But on an individual basis, performance can vary significantly, with some funds making a larger relative contribution to the overall performance of the industry. Using publicly available data to compare funds is key, with APRA’s performance heatmaps and quarterly statistics a vital source of information.
Ultimately, it’s important to leverage the full breadth of online resources to compare funds, not only on performance but also on the overall proposition.
Below are profiles of superannuation funds recently recognised for success at Super Review’s annual Super Fund of the Year Awards.
The International Monetary Fund has raised concerns about liquidity risks within Australia’s superannuation system due to a growing share of illiquid investments, such as private equity and credit.
As new superannuation payment rules approach, a firm has underscored the need for funds to brace for significant technological adjustments.
There was a 5 per cent rise in complaints to AFCA relating to superannuation in the financial year 2023–24, according to its annual report.
APRA has ramped up its scrutiny of superannuation fund spending, particularly targeting discretionary expenses like travel, entertainment, and conferences that may not be in the best interests of members.