Many of us start paying super during our very first job, and most of us now won’t retire until we’re at least 65 – making that a 50–or–so–year investment in our superannuation, perhaps the longest financial commitment we’ll ever make.
As with any long-term relationship, it can be easy to take things for granted. But staying in a poor-performing fund over the years, can leave us tens of thousands of dollars worse off when we retire.
The problem is, short-term investment performance doesn’t really tell us much about how our fund is doing because it’s a marathon rather than a sprint race. Financial markets are cyclical and they can give better returns to certain types of investment at any one time, depending on where that cycle falls.
What’s more important is choosing a high-performing fund over the longer term to make sure that your super balance doesn’t drop behind.
Another important contribution to keeping your super balance on a steady rise is ensuring that your super balance doesn’t get eroded by high fees and ongoing commissions. So, how do you figure out how your fund compares to the rest?
Top performing super funds in Australia
Superannuation is a complex area that’s hard for the average person to assess. Reputable industry awards do, however, provide solid data to help us work out how our super fund is doing.
For NGS Super members, the news is good: the fund’s Diversified (MySuper) and High Growth investment options were rated among Australia’s top ‘growth fund’ performers for the 2017/18 financial year by independent ratings firms SuperRatings and Chant West.
NGS Super’s default option for Accumulation account members (Diversified (MySuper) returned 10.5% for the financial year, a very strong result.
In fact, SuperRatings’ top 20 ranked funds for performance in 2017/18 were all not-for-profit super funds like NGS Super. Not-for-profit funds are run solely to benefit their members, unlike retail funds (such as bank-owned funds) which are run to also benefit their shareholders.
Industry super funds usually have lower fees and don’t pay commissions that can eat into your super balance over time.
Another industry gong for NGS Super came from the financial comparison website Canstar, which rated NGS Super in the top 5 super funds for younger members under 40 with balances between $55K and $100K, because of its performance, fees and product features.
And finally, NGS Super received the Best Fund: Insurance 2018 Award by Chant West for the quality and design of its insurance product.
It’s important to note that past performance is not a reliable indicator of future performance.
Understand your investment options
One of the smartest things we can do as superannuation investors are to understand our options and choose a mix of investments that match our goals.
NGS Super has a range of different investment options to choose from. They have different levels of risk and different potential returns. You might choose to invest differently depending on how close you are to retirement.
Your risk tolerance will also be affected by life events too; anything from serious accident or illness, to marriage or divorce, or even global market incidents, can all have a major impact on how much risk you feel comfortable taking with super.
Take a look at the different super investment options online or call us on 1300 133 177 between 8am and 8pm (AEST) Monday to Friday for more information.