Despite challenging economic and geopolitical conditions, superannuation pension funds continued their run of stellar returns in the year to December 2025, with the median pension Growth fund (61–80% growth assets) up 10.2%.
Once again, shares were the main driver of the result, with international shares leading the way thanks to the depreciation of the Australian dollar.
International shares returned 18.6% on a currency-hedged basis, but 12.5% unhedged due to the stronger Aussie dollar (up from US62c to US67c). Australian shares were up a more modest 10.7%.
Chant West senior investment research manager Mano Mohankumar says Growth funds, on average, have 31% of their total investments in international shares and a further 25% in Australian shares.
Remarkably, given worsening geopolitical tension, tariff uncertainty and a difficult investment environment, all major asset classes produced positive returns in 2025. Traditional defensive assets also held up well, with cash returning 4%, Australian bonds 3.2% and international bonds 4.4%.
Australian and international listed property were up 9.7% and 7.5% respectively, while international listed infrastructure returned 11.6%.
Unlisted assets also performed well. Final returns are still being calculated, but Chant West estimates that unlisted infrastructure gained 7–10% over the year and private equity finished with a low double-digit return. Even unlisted property was back in positive territory with an estimated return of 3–6%, after two years in the red.
As a result, even the most conservative investment option (21–40% growth assets) returned 6.9% in the year to December, although higher-risk options were the main beneficiaries of buoyant share markets.
At this rate, most retirees will have seen their pension account balance grow in 2025 even after withdrawing their minimum pension amount.
Leave a Reply
You must be logged in to post a comment.