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Super returns buoyant despite sustained volatility

Arrow up, median balances

While Aussie super members have suffered a second monthly decline in returns in a row, median balances are well ahead for the year to date, new figures show.

SuperRatings’ latest findings have suggested superannuation “remains one of the best investments over the last 10 years”.

The research house found that members in balanced options saw a 0.7 per cent fall in March, while those in growth options saw declines of 1.1 per cent. Members with exposure to Australian shares alone suffered a decline of 3.1 per cent, with members tracking the cash index as the only ones to record gains (0.1 per cent).

However: “It’s not all bad news, with super members in a balanced option still ahead for the financial year to date with growth of 5.7 per cent and a rolling one-year average of 8.0 per cent. Over the last 10 years the median balanced option has returned 5.9 per cent per annum with $100,000 invested in 2008 now worth $171,335.

“However, being in the right fund makes all the difference with the best performing balanced option outperforming the worst by more than $50,000 over the 10-year period.”

SuperRatings CEO Kirby Rappell says the data reaffirms super’s position as a strong investment, however super members will need to get used to volatility.

“That latest market turmoil has had a short-term impact on super returns,” Mr Rappell said.

“However, it remains overwhelmingly the case that superannuation continues to deliver strong returns to members over the medium to long term and is one of the most important sources of wealth for Australians.”

“Volatility is undoubtedly emerging as the new normal presenting an environment that many super members have not experienced in a decade. This volatility needs to be managed but no one should lose sight of the fact that super continues to deliver strong returns.”

Super returns buoyant despite sustained volatility
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