1. Understand Your Superannuation Goals
Start by identifying what you want your super to achieve. Your retirement goals will shape your investment strategy. Here are common objectives and the corresponding strategies:
| Investment Goal | Recommended Strategy |
|---|---|
| Long-term growth | High-growth or balanced funds |
| Stable returns | Conservative or diversified funds |
| Ethical investment | ESG (Environmental, Social, Governance) funds |
| Lower risk | Cash or fixed-interest funds |
| Low fees | Industry super funds or passive index funds |
2. Compare Superannuation Fund Performance
Evaluating a fund’s historical performance over 5 to 10 years offers insight into its consistency and ability to weather economic downturns. Below are some of the top-performing funds in 2024 based on five-year annualised returns:
| Super Fund | 5-Year Annual Return (%) | Investment Option | Fees (p.a.) |
|---|---|---|---|
| Hostplus | 9.2% | Indexed Balanced | 0.60% |
| Australian Ethical Super | 9.0% | Renewable Energy Focus | 0.75% |
| UniSuper | 8.8% | Sustainable Balanced | 0.67% |
| AustralianSuper | 8.5% | Balanced Growth | 0.65% |
| REST Super | 7.6% | Balanced | 0.72% |
Indexed and industry funds generally offer strong long-term returns and competitive fees. Consider the net return after fees to determine true value.
3. Evaluate Superannuation Fees and Costs
Fees can dramatically affect your retirement balance. Here’s how fees impact a $500,000 investment over 30 years at 7% annual growth:
| Annual Fee (%) | Balance at Retirement |
|---|---|
| 0.5% | $3,800,000 |
| 1.0% | $3,300,000 |
| 1.5% | $2,800,000 |
| 2.0% | $2,300,000 |
Always review investment, administration, and insurance fees to avoid unnecessary erosion of your balance.
4. Assess Risk and Investment Strategy
Your risk appetite influences the type of superannuation investment you should choose. Here’s a quick guide:
| Investment Option | Risk Level | Potential Return | Best Suited For |
|---|---|---|---|
| High-Growth | High | 8–12% p.a. | Younger investors |
| Balanced | Medium | 6–9% p.a. | Mid-career professionals |
| Conservative | Low | 3–6% p.a. | Near retirees |
| Cash | Very Low | 1–3% p.a. | Short-term savers |
Diversifying your investments reduces risk while maximising returns. Some funds let you blend strategies to suit your unique profile.
5. Consider Ethical and ESG Super Funds
Ethical investing is gaining momentum. ESG funds focus on sustainable industries while avoiding tobacco, fossil fuels, and weapons.
| Fund Name | 5-Year Return (%) | Ethical Focus |
|---|---|---|
| Australian Ethical Super | 9.0% | Renewable Energy, ESG |
| Future Super | 8.7% | Fossil Fuel-Free |
| UniSuper Ethical | 8.5% | Sustainable Investments |
| Verve Super | 7.8% | Women-Focused Ethical Investing |
Ethical funds often match or exceed traditional performance — proving values-based investing can be financially smart too.
6. Understand Insurance in Superannuation
Most super funds include insurance by default:
- Life Insurance: Lump sum to your beneficiaries upon death
- TPD Insurance: Pays out if permanently disabled
- Income Protection: Replaces a portion of your income if injured or ill
Review your coverage and premiums annually to ensure it aligns with your personal needs. You may be overpaying or underinsured.
7. Check Fund Transparency and Customer Service
Choose a super fund with clear communication, responsive support, and flexible investment choices.
| Super Fund | Customer Satisfaction Rating (%) |
|---|---|
| AustralianSuper | 89% |
| UniSuper | 87% |
| Hostplus | 85% |
| Sunsuper | 82% |
| REST Super | 80% |
Need Expert Help Choosing the Right Super Fund?
Whether you’re planning for retirement, seeking lower fees, or interested in ethical investment options, Taxopia’s super fund specialists can guide you to the best decisions tailored to your goals.