Being in a good performing super fund is one of the key factors for growing your super balance. The recent Productivity Commission (PC) review of superannuation identified that members of consistently poor performing funds would have substantially lower super balances at retirement.
The PC produced an example of a 21-year-old on a $50,000 starting salary. If they joined a super fund that is consistently in the top quarter of funds rated by performance, they could expect to retire at 67 with a super balance of $1.2 million. If instead they joined one of the super funds that is consistently in the bottom quarter of funds they would retire with $560,000 – 54% less.
We’re grateful to SuperRatings for providing the following list of top 30 performing balanced funds over the last 5 calendar years up to December 2018. SuperRatings’ balanced category includes super fund investment options with 60% to 76% of their assets invested in growth assets.
The gold medal goes to Hostplus which achieved an average of 8.3% per year over the last 5 years. Of the top 30, 26 are Industry funds, with only two Corporate funds, one Public Sector fund and one Retail fund rounding out the list.
|Fund and option||Type||Fees (based on $50,000 balance)||Return over 5 years (% per year)|
|Hostplus – Balanced||Industry||$608||8.3%|
|QSuper – QSuper Balanced||Industry||$475||8.0%|
|Cbus – Growth (Cbus MySuper)||Industry||$538||7.9%|
|AustralianSuper – Balanced||Industry||$408||7.8%|
|MTAA Super – My AutoSuper||Industry||$508||7.6%|
|Sunsuper for Life – Balanced||Industry||$563||7.5%|
|Mercy Super – MySuper Balanced||Corporate||$636||7.5%|
|UniSuper Accum (1) – Balanced||Industry||$366||7.5%|
|CareSuper – Balanced||Industry||$673||7.4%|
|Intrust Core Super – MySuper||Industry||$568||7.4%|
|Catholic Super – Balanced (MySuper)||Industry||$769||7.3%|
|BUSSQ Premium Choice – Balanced Growth||Industry||$598||7.2%|
|Equip MyFuture – Balanced Growth||Industry||$422||7.2%|
|HESTA – Core Pool||Industry||$555||7.2%|
|Media Super – Balanced||Industry||$555||7.2%|
|Club Plus Super – MySuper||Industry||$599||7.1%|
|VicSuper FutureSaver – Growth (MySuper) Option||Industry||$563||7.0%|
|Vision SS – Balanced Growth||Industry||$508||6.9%|
|Energy Super – Balanced Option||Industry||$582||6.9%|
|First State Super – Growth||Industry||$527||6.7%|
|NGS Super – Diversified (MySuper)||Industry||$670||6.7%|
|CSC PSSap – MySuper Balanced||Public sector||$575||6.7%|
|Local Government Super Accum – Balanced Growth||Industry||$711||6.6%|
|AMIST Super – Balanced||Industry||$468||6.5%|
|REI Super – Balanced||Industry||$661||6.4%|
|TelstraSuper Corp Plus – Balanced||Corporate||$603||6.4%|
|MLC MKey – Horizon 4 – Balanced Portfolio||Retail||$908||6.4%|
|Rest – Core Strategy||Industry||$498||6.2%|
|TWUSUPER – Balanced*||Industry||$808||6.2%|
|LGIAsuper Accum – Diversified Growth||Industry||$535||6.2%|
Note: Returns are net of investment fees, tax and implicit asset-based administration fees. Fees are based on a $50,000 balance as at 31 December 2018. Fees include percentage-based administration fees, member fees, investment management fees (including performance-based fees), indirect cost ratios (ICRs) and taxes, but exclude any applicable employer size rebates.
The performance for the SR50 balanced index (the average across the 50 funds in the balanced investment option reviewed by SuperRatings) was 6.4% per year, so not all the funds listed above performed better than the average.
Although the difference between the top performer and the average may not seem that significant (1.9% per year), the difference builds up significantly over time due to compounding.
SuperGuide’s Super fees and returns calculator helps illustrate the difference that fees and returns can make over time. For example, a 20-year-old with $5,000 in super and earning $50,000 per year, paying 0.8% in fees and achieving 8.3% per year, could retire at 65 with a super balance of approximately $695,779. All other things being equal, achieving 6.4% instead would mean a super balance of approximately $413,076 – a difference of $282,702, or 40% less.
Fees are an important part of the equation, and there was a significant variation in the fees charged (based on a $50,000 balance) across the 30 funds. The most expensive fund (the only retail fund) charged $908 per year, while the average was $582 per year and the lowest was $366 per year. Discover the super and pension funds with the lowest fees, and find out what are the average super fund fees.
Important: Superannuation is a long-term investment. It’s useful to know the top performers over five years, but you can get a better idea of which funds are consistently the strongest by looking at longer periods.
Learn more about super investing in the following SuperGuide articles:
- Risk profiling and your investment choice
- Understanding the dynamics on which your super fund invests
- SMSF investment rules: What every trustee should know
- How to create an SMSF investment strategy (including examples)
- Super investing: How to choose a responsible investment option
- Super investing: Should you change your investment option?
- Super investing: How to change your investment option
- Super investing: Are you investing in infrastructure?
- Super investing: What are listed and unlisted investments?
- Super investing: What is your risk profile?
- How to choose an investment option for your pension
Learn more about investment performance over calendar years in the following SuperGuide articles:
- Best performing pension funds over 5 calendar years (to December 2018)
- Asset sector performance: Returns over 1 to 15 calendar years (to December 2018)
- Super fund performance over 26 calendar years (to December 2018)
- Best performing super funds over 15 calendar years
- Best performing super funds over 1 calendar year (to December 2018)
Learn more about investment performance over financial years in the following SuperGuide articles: