Super – A Long Term Investment
When it comes to growing your superannuation you need your super fund investments to perform well as this will lead to you having more money available in retirement.
When assessing performance, it’s important to look at more than just the highest returns over the past 12 months. In fact, switching between funds or investment options chasing the highest returns each year can result in lower overall growth because super is a long term investment and most investments have cycles.
So what should you look at?
Super funds regularly provide information on their investment returns to show short, medium and long term performance.
For most people it is long term performance that should be considered. This is not only because the timeframe until retirement, at say 60, is long but also because the time spent with your money invested during retirement is also long, given the average person lives about another 20 years after retirement.
So even if there’s only a short time until you retire, strong long term performance from your super fund investments is still very important as better outcomes can be achieved with consistently good performance as opposed to occasional top performance.
Another thing to check when looking at different investment returns is that you are comparing apples with apples for a fair evaluation. Check that you are comparing returns for the same time period and the same type of investment option.
Also remember that there are many factors to consider when assessing the performance of a super fund or investment option, a number of these being personal preferences such as your tolerance to risk.
If you have any queries on your super and how your money is invested BUSSQ can help you. Call 1800 MY BUSSQ (1800 69 2877) or visit bussq.com.au