Media releases Archives - Page 2 of 3

Media release: Super Funds bounce back in October

Leading superannuation research house SuperRatings estimates that the median balanced option generated a return of 3.0% in October, providing a boost to members’ balances.

In November, we again saw a 25-basis point rise in Australia’s cash rate, with markets focused on whether this is a signal that future rate rises are moderating, or the Reserve Bank of Australia is simply waiting for the lagged impact of previous hikes to take greater effect before reassessing the size of future increases. Similar sentiment in the US supported a rally in equity returns over the month, with most markets globally posting positive results, despite inflation remaining elevated. It is pleasing to see some positive news for members this month; however, it reflects the volatile environment, with the bumpy ride expected to continue.

The median growth option increased by an estimated 3.7% in October, while the median capital stable option which has less exposure to share markets delivered a smaller positive result, with a rise of 1.3%.

Accumulation returns to October 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	3.0%	-3.4%	4.5%	5.6%	6.3%	7.8%
SR50 Capital Stable (20-40) Index	1.3%	-2.5%	1.8%	3.0%	3.6%	4.6%
SR50 Growth (77-90) Index	3.7%	-4.5%	5.3%	6.5%	7.2%	9.0%

Source: SuperRatings estimates

Pension returns also rose in October, with the median balanced pension option up an estimated 3.3%. While an increase of 4.1% was estimated for the median growth option and 1.5% for the median capital stable pension option.

Pension returns to October 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	3.3%	-4.2%	4.6%	6.1%	6.8%	8.5%
SRP50 Capital Stable (20-40) Index	1.5%	-3.0%	1.9%	3.3%	3.8%	4.9%
SRP50 Growth (77-90) Index	4.1%	-5.1%	5.7%	7.2%	8.0%	9.8%

Source: SuperRatings estimates

Executive Director of SuperRatings, Kirby Rappell commented, “It is pleasing to see a 3.0% return for members over the month of October; however, it really reinforces the importance of setting, and sticking to, a long-term strategy as members who may have panicked and switched when returns were down last month may have missed out on this recovery. It is going to continue to be a bumpy road and focusing on these short-term indicators isn’t telling you the whole story, so it’s best to consider your long-term objectives and the level of volatility you’re able to tolerate. This will best support setting a long-term strategy that can cope with the noise we are seeing in markets. As we approach the end of the calendar year, it is the perfect time to review your superannuation, talk to your fund or an adviser you trust and run a health check on your current settings to ensure your super is fit for the new year.”

Release ends

We welcome media enquiries regarding our research or information held in our database. We are also able to provide commentary and customised tables or charts for your use.

For more information contact:

Kirby Rappell
Executive Director
Tel: 1300 826 395
Mob: +61 408 250 725
Kirby.Rappell@superratings.com.au

November 9, 2022/by Kirby Rappell

Media release: Slight pullback in super funds returns over August

Leading superannuation research house SuperRatings estimates that the median balanced option delivered a return of -0.5% in August, driven by losses across developed markets following an accelerated interest rate response to inflationary pressures.

Another 50-basis point increase in the Reserve Bank of Australia’s cash rate saw it reach 2.35% in August, the fifth consecutive rise reinforcing the bank’s strong commitment to trying to slow runaway inflation.

The median growth option fell by an estimated -0.4%, while the median capital stable option delivered a similar negative result, with a decrease of -0.5%.

Accumulation returns to August 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	-0.5%	-3.8%	5.0%	6.3%	6.7%	8.0%
SR50 Capital Stable (20-40) Index	-0.5%	-2.5%	2.1%	3.4%	3.9%	4.8%
SR50 Growth (77-90) Index	-0.4%	-4.8%	6.0%	7.3%	7.7%	9.4%

Source: SuperRatings estimates

Pension returns also decreased in August, with the median balanced pension option down an estimated -0.6%. While a fall of -0.5% was estimated for the median growth option and -0.6% for the median capital stable pension option.

Pension returns to August 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	-0.6%	-4.1%	5.4%	6.8%	7.2%	8.9%
SRP50 Capital Stable (20-40) Index	-0.6%	-2.9%	2.1%	3.6%	4.0%	5.2%
SRP50 Growth (77-90) Index	-0.5%	-5.2%	6.5%	8.1%	8.4%	10.1%

Source: SuperRatings estimates

Executive Director of SuperRatings, Kirby Rappell commented, “Over the month of August we have seen a slight pullback in the strong recovery in returns we saw in July. While it is a small negative result this month, this reflects the volatility across investment markets, with elevated inflation levels continuing to pose challenges across markets. Another interest rate rise impacted investment returns, though the silver lining here is that this may benefit retirees who are deriving an income from their pension accounts through exposure to cash.”

Setting a long-term strategy remains crucial, with this month’s result showing that we are see-sawing between positive and negative returns over the short term, with multiple factors impacting the global economy and investment markets. Super funds typically have processes in place to navigate these uncertain times, so setting a strategy which meets your needs and then remaining focused on the long term remains our key message.

Release ends

We welcome media enquiries regarding our research or information held in our database. We are also able to provide commentary and customised tables or charts for your use.

For more information contact:

Kirby Rappell
Executive Director
Tel: 1300 826 395
Mob: +61 408 250 725
Kirby.Rappell@superratings.com.au

September 19, 2022/by Kirby Rappell

Managed Accounts, Media releases

Lonsec shows continued commitment to helping advisers

Lonsec continues to drive investment efficiencies for advisers by expanding its support of Managed Accounts on the Netwealth platform. Lonsec has added to Netwealth’s Global Specialist Series (GSS) Managed Account range, by launching Lonsec GSS Index Plus.

The portfolios are built around core Netwealth GSS passive strategies, and a range of active satellite funds that leverage Lonsec’s extensive research capabilities and backed by its rigorous governance and review process.

‘These new managed portfolios give investors and financial advisers access to investment solutions supported by one of Australia’s largest investment consulting and research teams,’ said Lonsec CEO Mike Wright.

‘Being able to access our portfolio construction and investment selection expertise can help advisers and investors to make better investment decisions and we’re proud to partner with Netwealth to bring these portfolios to the market,’ continued Wright

Lonsec GSS Index Plus offers four portfolios: Moderate, Balanced, Growth and High Growth. Each is designed to achieve different risk and investment objectives over various timeframes. They are constructed using a range of growth and defensive assets such as Australian and global equities, property, fixed interest, and cash.

‘We were excited to develop this suite of portfolios with Netwealth as they offer a cost competitive solution for investors looking for a quality investment providing capital growth and income over the medium to long term. The portfolios also incorporate dynamic asset allocation and use a core/satellite approach to investment selection,’ said Lonsec CIO Lukasz de Pourbaix.

Matt Heine, Netwealth Joint Managing Director said ‘Lonsec bring a wealth of investment research and portfolio construction expertise to this partnership, and we are sure that these portfolios will prove popular with our advisers and investors.’

Lonsec is one of Australia’s fastest growing Managed Accounts portfolio managers, with monthly net inflows recently exceeding $250m. Lonsec also recently acquired the specialist Managed Discretionary Account provider, Implemented Portfolios Limited, who has a deep history and commitment to helping advisers meet the needs of their clients.

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For more information, please contact:

Rob Hardy
Rob.Hardy@lonsec.com.au

August 17, 2022/by Rob Hardy

Lonsec Retirement Perspectives, Media releases

Media Release: Super funds post strong recovery in July

Leading superannuation research house SuperRatings estimates that the median balanced option delivered a return of 3.1% in July, with funds posting a strong recovery of earlier losses. Australian and global equity markets drove the recovery, notably the S&P/ASX 300 Information Technology Sector Index posted a return of 15.4% for the month.

The cash rate rose to 1.85% with the Reserve Bank of Australia’s fourth consecutive rate rise in August demonstrating swift tightening action to quell mounting inflation pressures.

The median growth option rose by an estimated 3.5%, while the median capital stable option also delivered a positive result, with an increase of 1.9%.

Accumulation returns to July 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	3.1%	-1.6%	4.9%	6.6%	6.2%	8.3%
SR50 Capital Stable (20-40) Index	1.9%	-1.2%	2.4%	3.7%	3.7%	4.8%
SR50 Growth (77-90) Index	3.5%	-2.1%	5.9%	7.5%	7.1%	9.6%

Source: SuperRatings estimates

Pension returns also increased in July, with the median balanced pension option up an estimated 3.3%. While a rise of 3.9% was estimated for the median growth option and 2.1% for the median capital stable pension option.

Pension returns to July 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	3.3%	-1.9%	5.2%	7.0%	6.8%	9.2%
SRP50 Capital Stable (20-40) Index	2.1%	-1.7%	2.5%	3.9%	3.9%	5.3%
SRP50 Growth (77-90) Index	3.9%	-2.8%	6.3%	8.2%	7.8%	10.4%

Source: SuperRatings estimates

Executive Director of SuperRatings, Kirby Rappell commented, “We’ve been emphasising the importance of focusing on the long-term and amid the recent market uncertainty it’s understandable that people have been concerned about the ups and downs in their account balances. This year we have seen the ongoing challenges of COVID-19 coupled with a challenging global economic environment driving the volatility. We continue to highlight the importance of setting your long-term investment strategy and the performance over the last month shows the perils of trying to time the market, with members who may have switched to more conservative investment options missing out on the bounce back.

It is pleasing to see a strong recovery over the month of July demonstrating the resilience of super funds and their ability to navigate the uncertain investment environment. While we are likely to see bumps ahead, the long-term trend for super funds has remained strong and steady.”

Release ends

We welcome media enquiries regarding our research or information held in our database. We are also able to provide commentary and customised tables or charts for your use.

For more information contact:

Kirby Rappell
Executive Director
Tel: 1300 826 395
Mob: +61 408 250 725
Kirby.Rappell@superratings.com.au

August 12, 2022/by Kirby Rappell

Media releases

Media Release: $1 of Super invested in 1992 estimated to be worth $7.67 30 years after the Super Guarantee was introduced

The superannuation industry reached a major milestone on the first of July, with the superannuation guarantee system being in place for 30 years. However, it comes at a time of significant market turbulence, with fund performance dipping into the red this financial year. This is off the back of the growing challenges of inflation and interest rate hikes, as well as ongoing global supply chain difficulties due to COVID-19 and the war in Ukraine. Despite the market volatility we have observed over the period, $1 of super invested on 1 July 1992 in the median balanced option, with 60-76% growth assets, is estimated to be worth $7.67 today (depending on fees), underlining the significant benefits super has brought to Australians over the past 30 years.

Leading superannuation research house SuperRatings estimates a return of -3.3% for the median balanced option for the financial year ending June 2022. This is the fifth time financial year returns have been negative since the inception of superannuation in 1992.

Executive Director of SuperRatings, Kirby Rappell said, “Funds have had a challenging second half of the financial year, dragging on a solid first half. This was the 5th negative return for balanced options we have seen since the introduction of super 30 years ago; however, it follows the second highest annual return of 17.8% in 2021. So, when you look at it over the last two years, members’ balances are up.”

Mr Rappell continued “Superannuation is a long-term investment and funds continue to provide strong long-term returns on average and have outperformed the typical CPI+3.0% investment objective. When you consider that share markets are down around 10-12% across Australia and globally, super funds have done well to prevent some of the steep falls that we have seen from being passed through to members’ super account balances.”

The median balanced option declined by an estimated -3.4% over June, while the median growth option reduced by an estimated -4.4%. While capital stable options which hold more traditionally defensive assets such as cash and bonds only fell by an estimated -1.7%.

Accumulation returns to June 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	-3.4%	-3.3%	4.2%	5.6%	6.0%	7.9%
SR50 Capital Stable (20-40) Index	-1.7%	-2.7%	1.9%	3.1%	3.5%	4.7%
SR50 Growth (77-90) Index	-4.4%	-4.3%	5.1%	6.8%	7.0%	9.1%

Source: SuperRatings estimates

Pension returns also declined in June, with the median balanced pension option down an estimated -3.9%. The median growth option fell by -4.8% while the median capital stable option saw an estimated -2.0% return.

Pension returns to June 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	-3.9%	-4.0%	4.6%	6.3%	6.6%	8.8%
SRP50 Capital Stable (20-40) Index	-2.0%	-3.2%	2.0%	3.4%	4.0%	5.1%
SRP50 Growth (77-90) Index	-4.8%	-4.9%	5.4%	7.3%	7.6%	10.2%

Source: SuperRatings estimates

30 Years of Super Fund Performance

The chart below shows that the average annual return since the inception of the superannuation system is 7.0%, with the typical balanced fund exceeding its long-term return objective of CPI+3.0%. If we consider this in dollar terms $1 invested in the median super fund’s balanced option would now be worth approximately $7.67 depending on the impact of fees.

Perils of Timing the Market

We continue to emphasise the importance of setting a long-term strategy for your superannuation. We suggest members remain alert and review their superannuation settings such as whether they are in the most appropriate investment option for their situation and checking their fees. We encourage people not to panic and speak with their fund or an adviser they trust before making any changes to their superannuation settings.

We found that a member who had a $100,000 balance and switched to cash from a growth or balanced option at the onset of the pandemic in March 2020 would be $35,000 to $45,000 worse off as at the end of June 2022. We continue to emphasise that while markets do dip at points over time, they are expected to recover over the longer term.

The chart below shows that over the last 15 years a member in the typical balanced option would have seen a balance of $100,000 in June 2007 grow to $206,769. A member in a growth option saw their balance accumulate to $205,647.
International Shares options have performed the strongest with the median option rising to $209,107, though it has been a bumpy ride across global markets in the last few years. While the median Australian Shares option sat slightly below its global counterpart at $207,525.

Mr Rappell commented, “Members should prepare for continued volatility with a rocky road ahead for investment markets. If you are not approaching or in retirement, keep in mind that all market movements in the short term are not the real story as you can’t access your money now. You only realise that loss if you switch investment options or take your money out, which would take away the opportunity to participate in any future recovery.”

“Whereas the current situation is more concerning for those nearing or in retirement. Typically, we see these members sitting in investment options which are less exposed to these market movements which lessens the impact of the bumps. The silver lining of the recent interest rate rises is it will help those deriving an income from fixed income assets, following the anaemic cash rate levels we have seen in recent years.”

Release ends

We welcome media enquiries regarding our research or information held in our database. We are also able to provide commentary and customised tables or charts for your use.

For more information contact:

Kirby Rappell
Executive Director
Tel: 1300 826 395
Mob: +61 408 250 725
Kirby.Rappell@superratings.com.au

July 7, 2022/by Kirby Rappell

Media releases

Media Release: Get your Super fit for the new financial year

Leading superannuation research house SuperRatings estimates that the median balanced option fell by -0.9% in May, as funds face into global market headwinds.

The Reserve Bank of Australia increased rates for the second month in a row, signalling that it is facing inflation challenges head on, with a 50 basis point rise applied to the cash rate.

Our estimate of performance for the financial year ending 31 May 2022 has fallen slightly into the red at -0.3%, which is down from a return of 17.8% for the previous financial year.

Executive Director of SuperRatings, Kirby Rappell said, “It is not surprising to see a dampening in the performance of super funds, as the investment environment is very challenging lately. However, the benefits of diversification have been clear as the volatility of super fund returns remains much lower than share markets.”

Mr Rappell continued, “Whilst it has been a pretty challenging time for markets and savings, it is important to put this all into context. Superannuation is a long-term investment and funds have delivered strong performance on average over time. Markets and economies go through ups and downs, and while it’s hard to see your retirement nest-egg bouncing around, it’s important to remain focused on taking a long-term outlook and trying to avoid getting caught up in the noise.”

The median growth option declined by an estimated -1.2%. We saw capital stable options weather the storm somewhat, with a fall of -0.5% due to their greater exposure to bonds and cash.

Accumulation returns to May 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	-0.9%	1.6%	6.2%	6.5%	6.2%	8.3%
SR50 Capital Stable (20-40) Index	-0.5%	0.0%	3.0%	3.6%	3.8%	4.9%
SR50 Growth (77-90) Index	-1.2%	2.3%	7.6%	7.7%	7.2%	9.6%

Source: SuperRatings estimates

Pension returns also declined in May, with the median balanced pension option down an estimated -1.1%. While a drop of -1.3% was estimated for the median growth option and a fall of -0.6% was determined for the median capital stable pension option.

Pension returns to May 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	-1.1%	1.9%	7.1%	7.2%	6.9%	9.4%
SRP50 Capital Stable (20-40) Index	-0.6%	-0.2%	3.2%	3.9%	4.0%	5.3%
SRP50 Growth (77-90) Index	-1.3%	2.4%	8.3%	8.5%	7.9%	10.7%

Source: SuperRatings estimates

Financial Year Performance over Time

The chart below shows that the average annual return since the inception of the superannuation system is 7.1%, with the typical balanced fund exceeding its long-term return objective of CPI+3.0%. The estimated return of -0.3% for the financial year ending 31 May 2022 represents a slight dip and as you can see below, years in which performance has been negative are typically followed by bounce backs in returns and a positive outcome since 1992 is evident on average.

Check your Super

As a new financial year is approaching, now is the perfect time to think about your super and whether you have the settings right for your current situation. Running a health check on your super periodically is a great way to keep your super fit!

Investment: check whether the investment option you’re in suits the level of risk, or amount of bumpiness in your balance, you’re comfortable with. Most funds have a risk profile tool on their website that can help you decide which investment option is most suitable for you. Having a look at performance for your fund is also important.
Fees: check your fees. The typical total annual fee on a $50,000 account is approximately 1.1% of this balance. See how your fund compares to other funds and the broader market.
Insurance: check the type of insurance and level of cover you have. Changes introduced in September 2019 mean that new members under the age of 25 will not automatically be given insurance when joining a super fund and members with a balance of $6,000 or less will not have insurance unless they opt-in. There are tools on fund websites that can help you understand how much cover might be right for you.

Kirby Rappell commented, “Getting the foundations right for your super is the best way to put yourself in good stead for a lifestyle in retirement that meets your needs. It is also beneficial to contact your fund and obtain guidance, support and advice to help set those foundations. Funds also provide access to advice service on investments, insurance, retirement and other topics to help you through the journey. This may be available through your fund directly or by using an adviser that is part of their network. Contact your fund to see what is available and how much it will cost – putting in the effort now can make a big difference to your future self.”

Release ends

We welcome media enquiries regarding our research or information held in our database. We are also able to provide commentary and customised tables or charts for your use.

For more information contact:

Kirby Rappell
Executive Director
Tel: 1300 826 395
Mob: +61 408 250 725
Kirby.Rappell@superratings.com.au

June 10, 2022/by Kirby Rappell

Media releases

Media release: Super Funds Bounce Back in March

A market bounce in March has supported super fund performance, with the global economy maintaining a reasonable degree of momentum. However, inflation concerns continue to mount as consumers face cost pressures.

The Reserve Bank of Australia kept rates on hold at a low of 0.1% citing ongoing inflation challenges and uncertainty due to the war in the Ukraine, although we see expectations of interest rate rises increasing.

Leading superannuation research house SuperRatings estimates that the median balanced option rose by 1.1% in March. Over the financial year to 31 March 2022, we see an estimated return of 2.4% for the median balanced option.

Kirby Rappell, Executive Director of SuperRatings said, “It is pleasing to see performance recover over the month, as we head towards the end of the financial year. It has been a rockier year for super fund members, although funds seem to be navigating the uncertainty reasonably well. While many Australians feel the impact of natural disasters and increasing inflationary pressures, super continues to support improved long-term financial security for many.”

“I’ve said it before and I will say it again, it is important to focus on the long-term when it comes to your superannuation. The rebound in performance over the March period reinforces this, if a member had switched when they saw performance fall in February, they would have locked in the loss instead of benefiting from the recovery we have now seen.”

The median growth option increased by an estimated 1.6%. The capital stable option, which has less exposure to equity markets in favour of bonds and cash, rose by 0.1%.

Accumulation returns to March 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	1.1%	7.6%	7.5%	7.5%	6.9%	8.4%
SR50 Capital Stable (20-40) Index	0.1%	3.1%	3.7%	4.0%	4.0%	5.1%
SR50 Growth (77-90) Index	1.6%	9.2%	9.0%	8.8%	7.7%	9.5%

Source: SuperRatings estimates

Pension returns have also risen in March, with the median balanced pension option up an estimated 1.2%, compared to an increase of 1.8% for the median growth option, while performance is estimated to be flat at 0.0% for the capital stable option.

Pension returns to March 2022

	Monthly	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	1.2%	7.8%	8.3%	8.1%	7.4%	9.4%
SRP50 Capital Stable (20-40) Index	0.0%	3.1%	4.0%	4.5%	4.3%	5.5%
SRP50 Growth (77-90) Index	1.8%	9.6%	9.6%	9.3%	8.5%	10.6%

Source: SuperRatings estimates

We estimate that the return over the financial year to March 2022 is sitting at 2.4% as shown below. Further, since the inception of superannuation, we have only seen 4 negative financial year returns (FY02: -3.1%, FY08: -6.4%, FY09: -12.7%, FY20: -0.8%). The average annual return over this period sits at around 7.2% pa which is ahead of fund objectives which are typically inflation + 3.0% over rolling 10-year periods.

Evidently, while the superannuation road may be bumpy at times, over the longer-term the typical balanced option shows a positive story for Australians.

Kirby Rappell commented, “We are currently on track to end the 2022 financial year in positive territory, depending on how investment markets perform over the June quarter, though performance will be far more muted than that observed in FY2021. While it is pleasing to see performance recover over the month of March, superannuation should be viewed with a long-term lens as there will be ups and downs over shorter term periods.”

Release ends

We welcome media enquiries regarding our research or information held in our database. We are also able to provide commentary and customised tables or charts for your use.

For more information contact:

Kirby Rappell
Executive Director
Tel: 1300 826 395
Mob: +61 408 250 725
Kirby.Rappell@superratings.com.au

April 8, 2022/by Kirby Rappell

Lonsec Retirement Perspectives, Media releases, News & Insights

Accessing Advice Helps Drive Better Retirement Lifestyle

With half the country in what seems never ending rounds of lockdowns and pandemic fatigue setting in, one of the last things most Australians want to do is look at their Superannuation balances and investment options. That is, however, exactly what SuperRatings is wanting us to do, as neglecting your super or responding to short term market moves can have a detrimental effect on your super balance.

SuperRatings Executive Director Kirby Rappell says, ‘We looked at the impact of switching out of a balanced or growth option and into cash at the start of the pandemic and found that those with a balance of $100,000 in January 2020 and who switched to cash at the end of March would now be around $22-27,000 worse off than if they had not switched.’

This effect of switching into cash as a response to market turmoil is also seen when looking at returns over the past 15 years. In this period, a typical balanced Super option has risen substantially, with a balance of $100,000 in July 2006 accumulating to $247,557, more than doubling in size. Those members investing in a growth option have experienced an even stronger result, with a similar starting balance growing to $254,006. Share focused options have delivered the highest returns, with the median Australian shares option growing to $276,099 and the median international shares option growing to $271,051, though these types of options involve greater risks. Over the same period, a $100,000 balance invested in cash would only be worth $151,158 today.

When considering your Super options, you don’t need to go it alone as many Super funds provide advice and tools to their members. Says Mr Rappell, ‘Most funds will offer scaled advice for free or at a low cost, with members able to get advice on topics such as contributions, investment options, insurance in the fund and the transition to retirement.’ Scaled advice is general in nature so you will need to check if your situation and goals align with the advice.
Continues Mr Rappell, ‘For members who want more tailored advice, some funds will offer comprehensive advice that will also take into account your financial assets outside of superannuation.’ While there will be a cost associated with this comprehensive advice, most funds will allow the cost of the advice to be deducted from the superannuation account, just make sure you check any costs and how they can be paid before agreeing to get the advice.
Looking at more recent returns, balances continued to grow in July. The typical balanced option returned an estimated 1.3% over the month and 18.5% over the year. The typical growth option returned an estimated 1.3% for the month and the median capital stable option also increased 0.9% in the month.

Accumulation returns to July 2021

	FYTD	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SR50 Balanced (60-76) Index	1.3%	18.5%	7.9%	8.4%	8.0%	8.6%
SR50 Capital Stable (20-40) Index	0.9%	7.8%	4.5%	4.5%	4.8%	5.3%
SR50 Growth (77-90) Index	1.3%	22.7%	9.2%	9.5%	8.9%	9.6%

Source: SuperRatings estimates

Pension returns were also positive in July. The median balanced pension option returned an estimated 1.3% over the month and 20.0% over the year. The median pension growth option returned an estimated 1.5% and the median capital stable option also rose an estimated 0.9% in the month.

Pension returns to July 2021

	FYTD	1 yr	3 yrs (p.a.)	5 yrs (p.a.)	7 yrs (p.a.)	10 yrs (p.a.)
SRP50 Balanced (60-76) Index	1.3%	20.0%	8.4%	9.1%	8.5%	9.5%
SRP50 Capital Stable (20-40) Index	0.9%	8.6%	5.2%	5.2%	5.2%	5.9%
SRP50 Growth (77-90) Index	1.5%	24.4%	9.7%	10.3%	9.8%	10.6%

Source: SuperRatings estimates

Release ends

Warnings: Past performance is not a reliable indicator of future performance. Any express or implied rating or advice presented in this document is limited to “General Advice” (as defined in the Corporations Act 2001(Cth)) and based solely on consideration of the merits of the superannuation or pension financial product(s) alone, without taking into account the objectives, financial situation or particular needs (‘financial circumstances’) of any particular person. Before making an investment decision based on the rating(s) or advice, the reader must consider whether it is personally appropriate in light of his or her financial circumstances, or should seek independent financial advice on its appropriateness. If SuperRatings advice relates to the acquisition or possible acquisition of particular financial product(s), the reader should obtain and consider the Product Disclosure Statement for each superannuation or pension financial product before making any decision about whether to acquire a financial product. SuperRatings research process relies upon the participation of the superannuation fund or product issuer(s). Should the superannuation fund or product issuer(s) no longer be an active participant in SuperRatings research process, SuperRatings reserves the right to withdraw the rating and document at any time and discontinue future coverage of the superannuation and pension financial product(s).

Copyright © 2021 SuperRatings Pty Ltd (ABN 95 100 192 283 AFSL No. 311880 (SuperRatings)). This media release is subject to the copyright of SuperRatings. Except for the temporary copy held in a computer’s cache and a single permanent copy for your personal reference or other than as permitted under the Copyright Act 1968 (Cth.), no part of this media release may, in any form or by any means (electronic, mechanical, micro-copying, photocopying, recording or otherwise), be reproduced, stored or transmitted without the prior written permission of SuperRatings. This media release may also contain third party supplied material that is subject to copyright. Any such material is the intellectual property of that third party or its content providers. The same restrictions applying above to SuperRatings copyrighted material, applies to such third party content.

August 20, 2021/by Nicci Chaplin

Media releases

Media release: The top returning super funds of 2020

In a year defined by the global pandemic and the locking down of economies, the superannuation system faced arguably one of its toughest test in its 29-year history.

Now, as super funds finalise their reporting for December 2020, the strength of superannuation’s comeback is clear. Despite the market turmoil in the first half of the year, Australia’s top super funds have posted some remarkable results.

Long-term returns have also held up well, evidenced by the 10-year performance rankings, demonstrating the quality of funds available to members.

According to data from leading research house SuperRatings, Suncorp was the top performing fund over the 2020 calendar year, with the Suncorp Brighter Super Pers – Suncorp Multi-Manager Growth Fund returning 9.6%. This was followed by Australian Ethical and Vision SS, whose balanced options returned 8.0% and 6.2% respectively.

Top 20 balanced options over 12 months

Source: SuperRatings

Moving out to 10 years, the top performers were UniSuper, whose balanced option has returned 9.0% p.a. over the last decade, followed closely by AustralianSuper and Cbus.

Top 20 balanced options over 10 years

Source: SuperRatings

Spotlight on risk and return in wake of COVID-19

It is important to consider not only the return that an option delivers but also the level of risk it takes on to achieve that return. A rough way to examine this is the variability in returns over time. Growth assets like shares may return more on average than traditionally defensive assets like fixed income, but this comes with larger ups and downs.

The table below shows the top 20 funds ranked according to their volatility-adjusted return, which measures how much members are being rewarded for taking on the ups and downs.

QSuper’s balanced option return of 7.9% p.a. over the past seven years is below some of its peers, but it has done this with a smoother ride along the way, meaning it has delivered the best return given the level of volatility involved.

Top 20 balanced options over 7 years ranked by risk and return

Option name	Rolling 7-year return (% p.a.)
QSuper – Balanced	7.9%
BUSSQ Premium Choice – Balanced Growth	7.8%
Prime Super – MySuper	7.9%
Cbus – Growth (Cbus MySuper)	8.5%
CareSuper – Balanced	7.9%
MTAA Super – My AutoSuper	8.0%
Catholic Super – Balanced (MySuper)	7.7%
VicSuper FutureSaver – Growth (MySuper) Option	8.0%
Mercy Super – MySuper Balanced	7.7%
AustralianSuper – Balanced	8.8%
Aware Super (previously First State Super) – Growth	7.8%
Media Super – Balanced	7.6%
CSC PSSap – MySuper Balanced	7.1%
Sunsuper for Life – Balanced	8.0%
Hostplus – Balanced	8.4%
Vision SS – Balanced Growth	7.9%
HESTA – Balanced Growth	7.7%
Club Plus Super – MySuper	7.3%
Equip MyFuture – Balanced Growth	7.7%
Local Government Super Accum – Balanced Growth	7.3%

Source: SuperRatings

“What the calendar year figures hide is the rollercoaster movements members experienced as the market sold off back in March 2020 and then rapidly recovered,” said SuperRatings Executive Director Kirby Rappell.

“As members accumulate wealth over time, market movements will have a bigger impact on their account balance in dollar terms. This is a challenge for funds and members as the average super balance rises over $100,000, with the need for education and support paramount.”

While it is important to acknowledge those funds that have outperformed over 2020, members should bear in mind that long-term performance is what really counts.

“Overall, funds have done an excellent job of managing risks through a tumultuous period,” said Mr Rappell. “Super is a long-term game, so it’s pleasing to see long-term returns remain healthy and ahead of their CPI+ targets.”

Release ends

Warnings: Past performance is not a reliable indicator of future performance. Any express or implied rating or advice presented in this document is limited to “General Advice” (as defined in the Corporations Act 2001(Cth)) and based solely on consideration of the merits of the superannuation or pension financial product(s) alone, without taking into account the objectives, financial situation or particular needs (‘financial circumstances’) of any particular person. Before making an investment decision based on the rating(s) or advice, the reader must consider whether it is personally appropriate in light of his or her financial circumstances, or should seek independent financial advice on its appropriateness. If SuperRatings advice relates to the acquisition or possible acquisition of particular financial product(s), the reader should obtain and consider the Product Disclosure Statement for each superannuation or pension financial product before making any decision about whether to acquire a financial product. SuperRatings research process relies upon the participation of the superannuation fund or product issuer(s). Should the superannuation fund or product issuer(s) no longer be an active participant in SuperRatings research process, SuperRatings reserves the right to withdraw the rating and document at any time and discontinue future coverage of the superannuation and pension financial product(s).

Copyright © 2021 SuperRatings Pty Ltd (ABN 95 100 192 283 AFSL No. 311880 (SuperRatings)). This media release is subject to the copyright of SuperRatings. Except for the temporary copy held in a computer’s cache and a single permanent copy for your personal reference or other than as permitted under the Copyright Act 1968 (Cth.), no part of this media release may, in any form or by any means (electronic, mechanical, micro-copying, photocopying, recording or otherwise), be reproduced, stored or transmitted without the prior written permission of SuperRatings. This media release may also contain third party supplied material that is subject to copyright. Any such material is the intellectual property of that third party or its content providers. The same restrictions applying above to SuperRatings copyrighted material, applies to such third party content.

January 21, 2021/by Kirby Rappell

Media releases, News & Insights

Lonsec’s Retirement Managed Portfolios now available on AMP MyNorth

Lonsec has partnered with AMP to make its Retirement Managed Portfolios available via MyNorth Managed Portfolio.

The portfolios harness the depth and breadth of Australia’s leading research provider, allowing users to build high-quality retirement solutions incorporating Lonsec’s best investment ideas. Underpinning the portfolios is Lonsec’s strict quality criteria, requiring funds to be rated ‘Recommended’ or higher by its investment research team.

“Our managed portfolios give financial advisers access to investment solutions supported by one of Australia’s largest investment research and consulting teams,” said Lonsec CEO Charlie Haynes.

“Being able to draw on our investment selection and portfolio construction expertise is a real plus, and we’re proud to be able to extend this access via the North platform users.”

Lonsec’s Retirement Managed Portfolios are objectives-based and focused on delivering an attractive and sustainable level of income while generating capital growth through a diversified portfolio of managed investments.

Lonsec offers three Retirement portfolios: Conservative, Balanced and Growth. Each are designed to achieve different risk and investment objectives over various timeframes. They are constructed using a range of funds that play a specific role, such as income generation, capital growth and risk control, and backed by Lonsec’s rigorous governance and review processes.

“Our Retirement Managed Portfolios have been constructed to manage the risks most relevant to investors in the retirement phase,” said Lonsec’s Chief Investment Officer Lukasz de Pourbaix.

“By diversifying across asset classes, managers and return sources, we aim to manage risks such as capital drawdown, which can materially impact the longevity of a retirement portfolio, particularly in the early stages of transitioning from superannuation to the pension phase of investing.”

“We’re very excited to be working with AMP to make these portfolios available to AMP’s North wrap users.”

Inclusion on North further expands the distribution of Lonsec’s Managed Account offering, following its existing availability on the BT, Macquarie, HUB24, Netwealth and Praemium platforms.

Lonsec’s retirement portfolios have been constructed to meet the income and capital objectives of investors in the retirement phase as well as to manage risks that are specifically relevant to retirees.

AMP’s North platform offers advisers flexible and efficient access to a range of investment products, which now include Lonsec’s retirement portfolios, giving advisers the tools they need to meet their clients’ goals.

February 18, 2020/by Gordon Toy