Superannuation - The Simple, No Financial Advice Help

Lsamkenny on 15/06/2020 - 15:55
Last edited 15/06/2020 - 20:31

Hi There. I would hope someone can help me from not being stupid and get out of CBA essential super I have been a member of since 2013.
e.g. I just noticed my super made $52 last in 6 months (last year ending on Dec 2019) on 20K amount. Leaving it in a savings account would have generated more…

In essence, what I should be looking for, etc. Ozbargain style :)

EDIT: Statment is for ending on Dec 2019 (pre cv)

EDIT 2: Legally, you can't give me financial advice but only general in nature. If anyone is confused with the title, let me know a better suggestion :)
Like you use a certain super is good for having an app, return, low cost, etc you would recommend

Edit 3: I would like to thank everyone and a few special ones that went out of there way to share the knowledge. Expected only sarcasm and trolls (there were a few and all funny in my opinion) but genuinely learned something new.

Now, how to close this thread…

Financial

Comments

  • keejoonc on 15/06/2020 - 16:08
    +8

    Were you living in a cave for the past 6 months? What do you think happened in the last 6 months that would have had a significant impact on the financial market I wonder.

    • samkenny on 15/06/2020 - 16:16

      Point taken, I have updated the description to clarify that the return was for last year.

  • lolz112 on 15/06/2020 - 16:10
    +2

    Wow $52 in the last 6 months. If only there was some sort of global pandemic that could explain why the returns are so low in that timeframe…

    You're right OP. Put it in the cash for the next lifetime and you'll come out ahead :)

  • Seraphin7 on 15/06/2020 - 16:14

    You might find that you've actually done quite well based on that return.

    Speaking personally, I've gone backwards over the last 6 months by a significant amount … thank you coronavirus.

    The nature of superannuation (depending on what you're invested in) is that your balance will go up and down over any given period of time.

    • samkenny on 15/06/2020 - 16:19

      Thanks for the insight. I understand a little and didn't care when my balance was so low. Given that I have 50K now this year, I am thinking where to keep it for the long term. The question posted was pre-CV (i.e. July 2019 - Dec 2019)

      • Seraphin7 on 15/06/2020 - 16:21

        No problem. The key is to determine what you are invested in. That will drive your return (however positive or negative that may be). No two superannuation products are (necessarily) the same!

      • akyeeeahdude on 15/06/2020 - 18:37

        Were you invested during that time in Fixed Interest/Bonds?

        • samkenny on 15/06/2020 - 20:35

          No, foolishly in cash for years…

  • Hithere on 15/06/2020 - 16:16

    Superannuation is a long term investment, not a get rich quick scheme.

    What has your fund invested in?

    How much are their fees and charges?

    Consider rolling your money over into an industry fund if you're not happy with your current fund's fees and charges.

    • samkenny on 15/06/2020 - 16:29

      Invested in Cash. Had a return of 0.64% (my savings account did better) hence, I thought I should finally try to understand this.

      Fees are $30 a year. That is it.

      • jelko on 15/06/2020 - 17:51
        +5

        Why on earth do you have it in cash? Are you going to retire in the next couple of years? How old are you? It should be invested in the "Growth" option.

      • Hithere on 15/06/2020 - 18:03
        +2

        IMO you have invested incorrectly OP.

        Cash is more for the retired or near to retired person who wants security and stability, not big returns.

        Look for something more aggressive with good growth, something that long term that you will stand a better chance of receiving a good return. YMMV

        Consider industry funds.

        Disclaimer: I am not a qualified adviser. Seek professional advice, sooner than later.

  • dust on 15/06/2020 - 16:17
    +2

    You're asking for financial advice but have explicitly asked us not to provide you financial advice.

    • samkenny on 15/06/2020 - 16:27

      I meant to say, legally, you can't give me financial advice but only general in nature :)

  • brad1-8tsi on 15/06/2020 - 16:28

    What fees are they charging?

    What investment mix are you in?

    Are you paying for insurance?

    • samkenny on 15/06/2020 - 16:30

      Invested in Cash. Had a return of 0.64% (my savings account did better) hence, I thought I should finally try to understand this.

      Fees are $30 a year. That is it.

      Sorry for the copy/paste…

      • brad1-8tsi on 15/06/2020 - 16:44
        +1

        I find the $30/yr hard to believe but I'll take your word for it.

        If you are under 40 you should be in something more agressive than cash. (I'm almost 59 and still in quite an agressive mix and it's doing nicely for me - but it isn't for everyone).

        Are you sure you aren't paying for death or disability insurance?

        Just on what you have said, you are in the wrong investment choice unless you are over 50 or massively risk averse.

        Can you blank out all the things that would identify you or your account # and post up the statement?

        I just looked at the CBA website. I appears that the monthly fee is $5.88 and the investment fee is 0.75% of the balance. This could be wrong as they've done a good job of making it look nice but also making it confusing.

        Are you in their "LifeStages" scheme. how old are you?

        • samkenny on 15/06/2020 - 17:02

          Hi Brad, thanks for taking the time to write back.

          I am just turning 30 and starting to take this seriously. And yes, I would be picking up a super where I can be aggressive as well.

          No insurance (checked it).

          The assumption is not risk-averse but not knowing better…

          Pretty extensive pdf and many places where there are personal details.

          Yes, charges $5.88 -.88 as credit. Effectively $5.

          It is essential super and all I know. They are no longer offering super to new clients. Hence, why they don't care for any decent returns…

          • brad1-8tsi on 15/06/2020 - 18:00
            +4

            @samkenny: Insurance - I don't use it but I have no liabilities if I die and have enough money to cover me if I'm incapacitated. Insurance is for people with no reserves. Work out if you need it - it is cheap through super.

            I'd look at an Industry fund like Hesta or Australian Super (I'm with First State Super and could do slightly better but it's not enough to chase the $$).

            Their yearly fee should be similar but check it out.

            My admin fee is $4.33/month plus 0.15% of the account balance (max $750).

            I do a DIY mix of investments: type / % of portfolio / management fee
            growth (access to cash, bonds, property) / 20% / 0.8% fees
            Australian Shares / 25% / 0.09%
            International shares / 35% / 0.09%
            Diversified Socially Responsible (justifies me voting Green :-) ) / 20% / 0.59%

            The returns from 01/07/2019 to 30/12/2020 were 12% over 6 months. I'm sitting about 5% below the Dec 2019 balance at the moment which I'm happy with.

  • whooah1979 on 15/06/2020 - 16:36
    -1

    $52 last in 6 months on 20K

    That 0.0026% over two quarters. You may as well have kept it under your mattress.

    You may be able to withdraw $10k from super now and $10k after June 30. There are other markets that yield better results for the short-medium term than keeping it in super.

    • samkenny on 15/06/2020 - 16:40

      Thanks mate. Already pulled the first one as I am legitly been affected by CV and don't qualify for JobKeeper (a few months out since I opened my business). As a partnership (not the company one), I can pay myself any super and I did only to pull for a home loan in the future.

  • toniyellow on 15/06/2020 - 17:01
    +2

    It is not just the fund, it is the choice you make within the fund. From their PDS it sounds like there are four investment options

    MySuper product (the Lifestage investment option) as well as three other investment options – Balanced, Australian Share and Cash Deposit.
    https://www.commbank.com.au/business/superannuation/essentia…

    A person close to retirement might want a good percentage in cash to ride out any volatility at the time they retire.

    Even if I was 65 though personally would not have put it in 100% cash - I would be hoping to live to 85, so I would still keep some of it in options more targeted to longer term returns.

    I would consider changing to an industry fund (small i, doesn't need to be one of the ones that pays for ads on TV), and look for one that has investment options suitable for your age and risk appetite

    Check out REST, AustralianSuper, Sunsuper, etc

    • samkenny on 15/06/2020 - 17:06

      Thanks Toni. You and Brad have taken the time and I feel humble. My partner, she is on Rest. Since I never got a return, I didn't care not knowing that by choosing cash, was the reason for poor returns.

  • netjock on 15/06/2020 - 17:43

    Most Super would have performed about the same.

    Like suggested I would +1 at looking at fees you are being charged. CBA might be charging you 1% (or more). Look at the industry super funds and check their fee structure.

  • Mechz on 15/06/2020 - 18:56
    +2

    Put it all in high risk and look at it again in 10 years.

  • unco on 15/06/2020 - 19:20
    +2

    Thread should be titled “Super investment option was cash, why has it not gained value?”

    • samkenny on 15/06/2020 - 20:28

      Good one.

  • Eeples on 15/06/2020 - 19:46
    +1

    OP invested in cash pre-COVID.

    Even now….. change to Balanced if you a young and pessimistic and to Growth if you are young and optimistic.

    /end thread

    • donga100 on 15/06/2020 - 20:23
      +1

      OP invested in cash pre-COVID.

      Genius!

    • samkenny on 15/06/2020 - 20:33

      Thanks, without the explanation of the others at the top, I would have still been confused by your comment but all makes sense now :)

  • pantsparty on 15/06/2020 - 20:15

    Basically all super funds are performing poorly at the moment - this is only temporary - things will recover eventually. Change to the balanced option from Australian Super - they always rate well in terms of performance relative to fees paid.

    • samkenny on 15/06/2020 - 20:35

      Thanks mate!

  • AdosHouse on 15/06/2020 - 21:49

    I wish I only lost $52 in the last 6 months.

    I'm with HostPlus and the f**kwits managing their investments has managed to LOSE $16K on $86K in the last 6 months. I'm moving away from them ASAP. That is with Balanced, not High Risk.

    • brad1-8tsi on 16/06/2020 - 11:43

      I was down 25% at some point. Currently down 5%.

      There isn't a lot of logic in amortising a loss when all markets are down. This is a time to either wait or buy.

      • AdosHouse on 16/06/2020 - 12:50

        That $16k loss is where I was at yesterday. It was worse but recovered a little.

        On the Investment returns page for HostPlus they state that the FYTD return on Balanced is -6.36% and yet I am at -18.6% so I will be asking for an explanation from them.

  • blueyez on 16/06/2020 - 14:22

    I'd recommend an industry fund with low fees.

    Check your annual statement to see what cost your annual fees really are and compare with other funds via the PDS :)

    The Barefoot investor book is a good read and he touches on this topic.

  • afah0447 on 16/06/2020 - 16:02

    Get out of your retail fund as fast as possible and transfer into an industry fund.

    Retail funds' main priority is shareholder return, NOT member return. They have been historically the worst performing with the highest fees.

    I haven't had any issues with HostPlus' index fund. It's super cheap and recent returns have been pretty good (not withstanding the whole covid19 effect).

Login or Join to leave a comment
Login Join