Which is the best Superannuation at the moment, for starters (opening account, Zero balance)?
I was thinking of going for either SunSuper, or AustralianSuper.
I hardly know anything about super, or what to do with it, besides save for retirement. So any tips would be nice.
Thank you for your Answers, and any useful tip/hints.
What does your employer offer, you often can get automatic insurance with that.
All superfunds charge less fees when your account balance is less than $1,000
My tip is read the fine print on if you are also signing up for life insurance. If you are, make sure it is a level that you want and a price you want to pay.
Do note that opinions and comments on OzBargain aren't counted as financial advice.
As @cloudy as said — maybe you can look at the fees first. Superannuation fund linked with government usually has lower fees, and in this case Australian Super. However you still need to look at performance of individual fund, etc.
If you want to not worry about it for a few years (which I recommend if you are young), pick one of the industry funds and choose their default highest growth option. The industry funds reinvest profits for members, the non-industry funds send the profits to shareholders. That is the key reason that the industry funds have lower fees.
If you work in an aligned industry (e.g. retail has REST, healthcare has Hesta) by all means join their fund, as they may well have useful bonuses applicable to that industry. If you don't, just pick the one with the lowest fees for the high growth default option.
Don't be fooled into thinking a named investment option (e.g. Platinum Asset Management or BT Global or something with a trademarked brand) will offer better returns, history shows they generally haven't and they all charge higher fees. Just pick the cheap high growth option. Then don't think about it for a decade.
http://www.industryfunds.com.au/
Actually some of those Retail Funds have staggeringly high performance returns over the long term.
Funny enough a major bank own industry Super Fund, has been nominated the Fund of the year numerous times.
I agree w' the others, an Industry fund is the way to go. There are a few and Australian Super has been mentioned which I also agree w'. Anyone can join, it's huge, and they are negotiating to further reduce their already lower fees. Also, endorse the high growth option within the super fund. So, just another + vote from me.
Also …. mags like 'Money" have reasonable entry level info. The library would have it to have a quick look at what they say about super funds, or go to the newsagent. Money (etc) mag will often rate the various funds, which is a movable feast as one at the top this year may be no 6 the year before, and no 2 next year etc.
The fund comparisons don't usually compare the 'high growth' option though, just the 'default option' which is often called the 'balanced' option. But, for a young un starting out, it will be too conservative over the next 50 years or so. The definition of 'conservative' in super terms means too cautious an investment, which could well in theory mean that you make less over the long term.
This is not advice though, just some thoughts …
http://www.rest.com.au/Performance-Investments/InvestmentsPe…
http://www.sunsuper.com.au/WorkArea/linkit.aspx?LinkIdentifi…
The share options are higher performing but they're more volatile. People keep saying "in the long run". The problem is thats only true if you start off in the market at a good neutral point.
The Diversified/Structured option is usually best, it gives you a good mix.
This is misleading. Even if the OP starts at the pinnacle of the most explosive bubble, there is little harm done as the vast, vast bulk of their investment is in the many years to come.
I repeat the that the balanced option is too conservative for somebody starting in super (unless you are 45yro+). Go for growth and forget about it until you are older.
Totally agree with mskeggs. Studies have shown that if you are regularly investing smaller amounts of money over a large period of time, timing the market is irrelevant.
Speak with a financial advisor and discuss your personal preferences and goals. At this early stage you wont be thinking much about super and its many nuances, maybe when you hit 45+yo it becomes a little clearer (you can buy an awesome house, go with interest only and dump extra low-taxed-pre-tax dollars into Super instead of the mortgage type options) But for now, it's more set-and-forget…for a long long time.
Most likely they will talk about investment strategies and analyse your appetite for risk. In the short term, this really means nothing, but basically "Aggressive" = more risk and more hands on management and higher fees which generally mean greater returns (but not always)…"Risk Averse" usually is more to the stuffing-cash-under-the-mattress end of the spectrum which sees you going backwards due to the effect of inflation.
As a rule of thumb, the younger you are, the more riskier your approach in the earlier years and then you transition towards a more conservative approach as you near retirement and don't want to see your nest egg disappear in a puff of smoke like many did when they were hoping to retire around the time the GFC hit in 2009/2010.
Super is just one platform. A financial advisor will also cover things like alternate investments, insurance (life/trauma/income protection etc). Funnily, they never really go into much depth about leveraging your house as an investment vehicle - probably because there's no commission in that for them.
Life Insurance - have enough to cover your debts should you die and maybe also cover ongoing financial issues like the kids private school fees…don't treat it like a lottery ticket and go for the $1m "big win" cover.
Trauma - if you live under powerlines, eat badly, have really poor physical form or a family history of nasty diseases - could be a good thing to cover yourself for.
Income Protection - it's nice, gets you a tax deduction each year, but if you have parents with a big house and who aren't adverse to you moving back in if you get really sick I wouldn't really bother with it until you have a family to support that wont fit back in the parents house ;)
Thanks backpaqer, your comment and points are really helpful.
Cheers
While I don't disagree that mortgage leverage is an awesome vehicle for outsize returns, you do need to balance some risks.
So if you are investing in high risk investments (property, shares etc.) with your retirement savings, doing the same with your family home is pretty risky.
That was what fundamentally undid the Storm Financial clients, who lost their investments and the leveraged home when the market moved against them.
imho
Telstra Super is doing pretty well.
Hesta is doing pretty well as well, but not as good as Telstra Super.
I would speculate Telstra Super might have a reasonable stake in Telstra shares, which have shot the lights out this year for a high yield blue chip.
If they do, it is an inexcusable error, IMHO.
Presumably the bulk of their members are already strongly corrleated to Telstra's success, through bonuses, pay rises and job security/risk. To invest some of their retirement savings too is a recipe for disaster if the wheels fall off.
Is the OT looking at this still or made a decision?
Yes, I'm still looking at my post.
(thank you all for your helpful info.)
I think I'm going to go with Aus-Super.
ING direct living super is the best to begin with
Any reason why? There are various funds that offer age based investment profiles. Is this one lower fee or better in some way? I hear BT's mysuper low fee product will be age based too.
Go for the lowest fees stock heavy super fund, if you are young the two sure things are fees will eat into ur retirement savings and stocks will outperform all asset classes in the long (50 yr) run.