I'm a financial illiterate. I started working 5 years ago and I have been using CBA's Colonial first state as my super. Realised that I'm being ripped off since the last 5 years and I don't know where to move to. Can someone suggest me a super fund that is not a rip off and I can straight away start using? I read stuff about super and everything - funds, self-management, everything goes above my head. Any help would be appreciated. Thank you!
Looking For Superannuation Suggestion
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I've only been with AusSuper so far (I'm 20) so idk what's good or bad in the industry. What annoyed you about them?
I'd been with InSuper for years that became AustralianSuper (from 1988-2019).
AustralianSuper didn't want to listen to my instructions and transferred my Super to AUSFund without listening to me.
I then reached out to FirstState Super (to get my Super into a fund I could trust and would follow my instructions).
First State Super (now Aware Super) have been great at communicating and I'd recommend them. They have an App that works too.
I compared Aware to Australian Super when I kept reading all these wonderful promotional stories about Australian Super
and tracked comparative monthly performance figures for some months
until I realised that while Aware was updating the figures each month, the figures for Australian Super were not changing, as they were only showing performance like as at the end of the Last Financial Year, in other words NOT CURRENT performance.
e.g. https://www.australiansuper.com/compare-us/our-performance under Account based pension, TABLE, Long-term performance, says 'Annualised returns to 30 June 2024', and High Growth choice shows 9%pa over 10 years, and 10%pa for the last year.
https://aware.com.au/member/what-we-offer/investments/invest… under Retirement Income, Aware High Growth choice shows 9.5%pa over 10 years, and 12%pa for the last year. My choice of International Equities shows 13%pa over 10 years, and nearly 23%pa for the last year.
So I stopped comparing. Happy with Aware.
Frankly who cares about the month to month performance of super? It's likely the longest term investment you'll ever have and performance over any given month doesn't really matter.
@johnno07: In Aware. I can’t speak to other funds but when the blip happened last month it was great to download the unit prices into a spreadsheet and work out how the blip dropped and bounced back in each of the investment options.
This has better informed me of how much risk I am comfortable with.
Ie. On my current fund mix I lost and gained $51k; whereas a slightly more conservative mix would have been a loss and gain of $34k
@Eeples: Suggest carefully monitoring your asset allocation and ask yourself would I be comfortable if it dropped 20-30%?. The US economy is likely very close to a recession (if not already in one) after a long bull run in US equities. Australia will likely follow, as it does with most thing, as interest rates ease across the global. The next quarter is going to be pivotal and probably very volatile. Personally, I've already moved to a more defensive allocation.
@atwilliams: But that's the way the market works? There will be time when it drops even 40% like in 2008, but over next 10 years it recovered and gain a lot more.
@TimApple: Yep. I mentioned it, as some of the younger participants of this forum may not have experienced major bear markets and some who are closer to retirement may not be able to weather that sort of a fall without adverse impact to their retirement. Most will choose to "ride it out" (by doing nothing - which is fine), but I choose to switch between asset classes as the macro economics change to protect capital and amplify returns.
@atwilliams: Yep. I could manage a 20% drop.
Any more of that it would mean part time work or reduce my spending.
My market/defensive ratio is 86/14.
I am becoming less comfortable with that exposure as I take more notice of market volatility.
@Eeples: All good, but unfortunately it looks like that volatility is only just starting to ramp up, as the markets grapple with the increasing likelihood of a recession in the US and potentially here as well (based on yesterday's Australian GDP data). We are in for a roller coaster ride for the next 6 months.
Been with aware for decades. Even when I was out of a job, my account was going up because of low fees and good investments. I'll always be with Aware
I wish Aware would be more upfront as to which indexes their indexed product follow.
How did they annoy you?
You're better off choosing an Industry Superfund than any of the retail ones: https://www.industrysuper.com/
AustralianSuper and HostPlus are usually highly recommended.
That's not true. There are plenty of industry funds that perform worse than private funds.
For example Australian Super high growth (industry funds) has performed worse than Australian Ethical Australia shares (retail fund). CBUS growth (industry) has done worse than Bendigo bank high growth (retail).
Of course the best funds are all industry funds. But you can't just pick "any" industry fund and expect better returns than a retail fund.
Add to this a lot of people fall for the bs that industry funds pedal. eg Aus super's 'balanced' fund is 76.5% growth. But if you ask them property/infrastructure is defensive.
They get away with comparing more aggressive funds with less aggressive funds. Comparing apples with oranges.
https://www.australiansuper.com/investments/your-investment-…
I downvoted this one—typical response from someone who has never looked into retail funds and just believes what they see on the big billboards promoting industry supers.
The "stellar" performance of industry supers in the past few years were mainly due to two things.
Them not accurately reflecting true risk profiles. For example, their "Balanced" funds are actually about 70% growth and 30% defensive, which should really be labeled as "Growth" funds.
They invest in highly illiquid infrastructure and alternatives. These assets don't report their earnings/performance regularly and are less regulated.
OP says he got "ripped off" without elaboring how so.
Valuations of these assets are also "independently" valued at strange times and for strange amounts.
If you're looking to understand it properly, try reading through this as a resource:
https://passiveinvestingaustralia.com/how-to-invest-your-sup…Pretty happy with Hostplus.
No fuss I heard
With UniSuper and cannot fault them. Easy to use, good options, quick call wait times and nice returns with relative low admin.
*not advice, do own research etc etc…
same here, me and my wife are also with UniSuper because uni made that when I started tutoring back then :D
I am also with unisuper and i have been very happy with them.
Except that time they got their entire cloud environment deleted
Not their fault, in contact with clients daily and resolved without losses.
Personally, I have no expectations of technology being faultless. What I want is transparency and ownership when things go belly up. I would rather be in the loop than find out 3 months after the fact.
That story actually demonstrated how well they manage their data. Surprisingly Google really stuffed up and Unisuper 'luckily' had multiple backups and redundancies with various providers. If they were all-in with Google… may have been a different story.
I got a really rough deal with UniSuper's insurance, which is through TAL. I had to switch to get better cover, if that hadn't happened I'd still be with UniSuper.
When I tired to sign up to them years ago, they were exclusive to those working in academia. Is that still the case, or have they opened it up to the public?
Public now. They also bought out Catholic Ed Super
Although I agree with what everyone has said here, when I switched (from hostplus) to UniSuper about 2 years, I was unpleasantly surprised at their process. It was a bit of a pain in the arse in the modern era to have to physically print out documents, sign them, and send them back. Like… WTF.
Aside from the sign up process, they're looking pretty decent.
Hostplus here. Been with them for years never had an issue. Fees are pretty good and decent returns. Also an industry super fund so that’s always a plus.
You definitely right to get out of CFS. I was with AMP and Mercer and had a similar experience.
Been with Care Super for 20 years. They've done well, even through GFC and covid crashes. One of the best industry funds I think.
If/when you get into shares there's a Direct Share option where you can buy individual ASX shares with your super balance. Cost $10/month admin fee, regardless of value of shares, which is v reasonable.
I use Rest for the Australia Shares Indexed option. Fees seem low enough and you get the rough equivalent of a ASX VAS index fund.
switched to them myself after the 'industry funds' started increasing fees.
Rest is an 'industry fund'.
But I also use them for their low fee index options.
HostPlus Growth Indexed.
My strong recommendation after lots of research is the Rest or host plus lowest fees index funds, and get a 70/30 international/Australia split.
Pick the Lowest cost always. Lowest fees is the biggest thing you can do to improve your super performance because ongoing fees eat into your compound returns. Do a bit of googling to see why, you'll be shocked.
Any fees you pay for "actively managed funds" are going to support the lifestyles of their highly paid staff, who generally underperform the market anyway.
Don't believe any hype about superior returns.
Incidentally I work in the super industry - not one of the highly paid however - and I would not invest in anything except host plus or rest with the index funds. These are passive funds that will always deliver the market return. Anything else is a gamble.I agree about the lowest fees, but I think the biggest thing OP can do to improve super performance is to put it in the most aggressive fund with highest growth.
You will need nerves of steel OP! About every four years you will see catastrophic losses. But in the other years, you will get superlative returns, and the overall return will far outpace "Conservative" funds.
I wish I'd understood this many years ago (I'm at pension stage now).
Also think about the insurance that is usually rolled into super. Do you need it? If you're married with kids, perhaps you do, but otherwise ditch it.
PS OP, you are not a financial illiterate, the fact that you are thinking about this already means that you are head and shoulders above your peers.those index share funds are aggressive funds with high growth
Yes, if you're young you have time to ride out the bumps.
yep Rest Super passive index funds is the way to go. Same split as mine too.
Much lower fees and historical returns are on par or better than other managed funds that charge higher fees.
Why pay more for a managed fund when they cant even do better over multiple years compared to a passive fundMy strong recommendation after lots of research
Lol.
Pick the Lowest cost always. Lowest fees is the biggest thing you can do to improve your super performance because ongoing fees eat into your compound returns. Do a bit of googling to see why, you'll be shocked.
REST has performed very ordinarily over the last 10 years despite having low fees. Low fees are irrelevant, net return after fees is all that matters.
Don't believe any hype about superior returns.
What? Historical returns are a very material deciding factor. REST's passive balanced option has returned 5.11% net of fees over the last 3 years while Hostplus balanced fund has returned 10%.
I was talking about the indexed options not the balanced options where I agree the returns vary by provider and by year.
REST has performed very ordinarily over the last 10 years despite having low fees. Low fees are irrelevant, net return after fees is all that matters.
As mentioned if you're comparing balanced portfolios they have performed pretty averagely (+6.75% in their Core Strategy portfolio). Their high growth portfolio was also average but their overseas shares indexed options are doing quite well.
They were researching into crypto a few years ago which was absolutely idiotic, though. Anyway who knows, with climate change already here super funds could be wiped out before people would even be able to access them.
Hello! Thanks for the suggestion. Not taking this as a financial advice, but did you mean HostPlus Sector Specific Option -> International Shares - Indexed (70) and Australian Shares – Indexed (30)? Or Balanced (default) Investment option? I am in the process of joining HostPlus. Thank you!
Yes Indexed 70 overseas / 30 Australian would be very good for someone young with a long investment horizon like a super, and with a corresponding high risk tolerance (higher volatility for higher returns). It's an aggressive 100% equities position.
Research Bogleheads if you want to be read up on it. It'll boost your confidence.
As you approach retirement it would be normal to shift gradually to more defensive assets to ensure a stable retirement income. But that's not until someone's 50s most of the time.I’m sure big losses early on retirement can cause issues with those about to retire however the money might have to last 30 years… so much growth is still required. I’m thinking 70/30 is still required.
Rest uses derivate type investing (through Macquarie) to get its low fees - any thoughts on that? I'm not super well versed in it, but it's holding me back from fully rolling into Rest until I fully understand it.
I've been down the rabbit hole on that.
My tldr answer is don't worry about it. It's splitting hairs.
A friend who used to be C suite at a major bank said Macquarie is used as an intermediary on this kind of thing all the time, it's a very common arrangement, nothing unusual.
If Macquarie were to go bankrupt it could conceivably cause issues (although likely to be covered by various legal clauses and government guarantees). But if Macquarie go tits up, we are likely to be in a bigger financial crisis, and at that point having a different choice of super won't save anyone from the fallout.
If it doesn't feel right, go with hostplus for similarly low fees but without the intermediary.
Thanks - yes that is where my research had led me to as well. I think one just needs to consider the insurance aspect as well and who has the better insurance offer.
I found Australian Super to be one of the cheapest for fees and best performing until I switched to UniSuper which is now available to everyone.
Have a look at what insurance is being deducted out of your super too. I'm not saying to just go totally uninsured but you may not need/want all of the insurances you were default signed up to. For example, if you don't have a spouse/kids that depend on your income you may not care so much for life insurance.
Agree and sometimes insurances can overlap with one you may already have.
1) You're a financial illiterate.
2) You're with a major super company but are being "ripped off".How do you know?
I beg to differ with OP
Colonial First State is one of the best super funds around
It has reasonable fees and amazing investment flexibility.I didnt count but over 50 funds into which you can invest
including:
Aust Shares, International shares, long short funds, gold fund, bond and fixed interest, cash etc etc etc
This in addition to the usual high growth, conservative, and balanced funds.
The returns for all the fundsfor the last 1,2,3,5 and 10 years are all thier for anyone to exploreThe problem is not with CFS
The problem as OP admitted is with thier financial ignornace (by thier own admission but sorry)As a rule of thumb I suggest looking at the funds with the best returns over 3, 5 and 10 years
Hey @catgpt
Things I suggest - if you honestly have no financial idea then seriously do consider going to (and paying) a financial adviser because super is a long term investment and the difference between an OK fund and a good fund can make a serious difference. Its a good thing if you can recognise this isn't your strength and that it may be better you getting advice.
- Past performance is not a guide to future performance - but it is a good way of comparing funds and how they have performed historically.
- If you are a long way from retiring then you will probably be best with a growth or high growth fund and accepting the higher risks that come with that as if it does suffer in some years you have plenty of time to make it back up and smooth it all out. As you come closer to retiring people generally start moving it into safer funds that offer less risk but also less reward.
- Based on what you have said about yourself something self managed would not be good for you because they work best when you actively monitor and manage them making changes as needed.
Please do speak with a trusted family member at the very least if you don't go to a financial adviser.But be wary about FA recommendations too, eg moving your super may be a good idea, but they may recommend a wrap fund or other setup that benefits them more.
Try looking for one with lower fees. And when you do find it, if you are young then I would suggest putting it in high growth. There is this spreadsheet from reddit you can check out
https://docs.google.com/spreadsheets/u/0/d/1sR0CyX8GswPiktOr…Also check out this site, really good resources but in particular read the below article.
https://passiveinvestingaustralia.com/how-to-invest-your-sup…I was with CFS and Perpetual a long time ago. I got sick of the excessive fees even when they were losing me money, so I started a SMSF.
It's the cheapest option if you DIY, but I don't think that's the right choice for you.Ironically, I've now decided that index fund ETFs are better than trying to guess which companies will outperform, so I'm back to paying fixed fees again. At least they're far lower though.
For you, I would choose the fund with the lowest fees and a good track record of accurately tracking an index.
So you still have a SMSF, and are invested in index funds in it?
Yeah. I believe it's still the cheapest option, less than $1K annual costs.
For example, I know Qsuper has substantially higher fees than VGS for a similar investment.
Host plus, indexed balanced.
Not saying it is the best out there, just it's easy and does okay with low fees.
Make sure you don't get any insurance through whoever you go with that you don't want.
the new Hostplus indexed high-growth has even lower fees than indexed balanced but more aggressive in seeking growth (100%-0% vs 75%-25% in growth/defensive), obverall better choice if you are not approaching retirement.
I think there needs to be some regulations about what funds call their investment options.
Surely 75/25 is surely still Growth.
60/40 is probably growth too.You are right as usually for ETF 100%-90% growth assets is considered as "High Growth", 85-70% is considered "Growth", then 65-50% is "Balanced". So Hostplus' Index-balanced should be considered growth. But maybe for superannuation investments funds the wording is slightly different because everyone is basically investing long term, which inherently reduces the risk, so 75% growth is considered balanced overall.
In fact, unless 50 year old or older I would not want to have defensive asset in my super at all to be honest as it doesnt make sense
I have ended up with Australian Retirement Trust through many acquisitions of funds. They do a better job than the employee super fund I was with that I kept for the better TPD and salary insurance, but I certainly paid for it in performance….
Hi, I work in the industry (and no, I’m not a financial planner). When you say you got “ripped off,” could you please elaborate? CFS is actually a decent platform (full disclosure: my super is on FirstChoice), and they performed well, especially last financial year, which was reported across various media channels.
Usually, when I hear people say they are getting ripped off, it involves two things: cost and performance. Did you select the funds yourself?
I swear Hostplus only gets recommended by everyone because of The Barefoot Investor, too many people get hyper focused on the fees that they forget they are young and heave left their balance in the lowest risk options available. I wish I switched everything to high growth options when I was way younger than I did.
I moved my wife's super out of Colonial State (with her permission of course) to AustralianSuper after a decade of under performance and high fees. Her super has been growing nicely (~7-8% pa growth) ever since in the balanced option.
Consistent investment performance over the long term is what you are after, then low fees. Don't prioritise the other way around as that's a false economy.
Recommend the OP starts to educate themselves on super and financial matters more generally, so that they understand risk and how things work. Whilst we all love OzBargin, it's really not the best place to take long term financial advice from, as you have people who don't know what they are talking about, think they do, and actually do, but it's hard to work out who to believe!
Hey mate have you looked into AusSuper’s balanced options? Assuming it’s the premixed one - which is 73% growth 27% defensive. This is how industry funds come out “strong” because their asset allocations aren’t right. This is essentially a growth fund. Turns me off they label their balanced fund as “conservative balance” lol. Misleading at best.
If you apply this to CFS, the growth index which is the one I’m in, got 11% last year
Edit: this is actually a very good example of what I mentioned in the earlier comment”
Here is the last published AusSuper balanced asset allocation I can find. It obviously varies over time, as this option is it's actively managed. Not sure how you got to the 73/27% split, but what matters is the nature and risk profile of the individual assets and how that drives consistency of returns, given super is a long-term investment.
Australian Shares = 23.50%
International Shares = 28.50%
Private Equity = 4.00%
Unlisted Infrastructure = 9.00%
Listed Infrastructure = 1.00%
Unlisted Property = 8.00%
Listed Property= 1.50%
Credit=4.50%
Fixed Interest=14.00%
Cash=6.00%Yeh that’s what I’m trying to say , this allocation is not a balanced fund. The growth assets I’m referring to are Aussie shares. International shares , unlisted infrastructure etc. this so called balanced fund is actually growth, if you look at a similar growth fund in Colonial, return is similar. Unlisted infrastructure is the biggest scam as in they are not regulated and not liquid meaning if you need to withdraw quickly during a downturn, good luck
Australian Super is an industry fund. Colonial is not. There’s the first big difference.
Have a look at the APRA website for fund performance results. APRA are the regulators and they release annual performance results and dashboards so you can have an overview of most funds: https://www.apra.gov.au/2024-annual-superannuation-performan…
You may also find this useful:
https://www.ato.gov.au/calculators-and-tools/super-yoursuper…
here's some stuff to help you learn about super:
there's an government website outlining super to semi educate you about the topic:
https://moneysmart.gov.au/how-super-works/choosing-a-super-f…barefoot investor used to say host plus was the best. here's him talking about that company and super again ie if he still (at the time of writing) thinks it is great
barefoot investor has plenty of great stuff to help
https://www.barefootinvestor.com/articles/your-super-your-ch…
links to this- https://www.ato.gov.au/calculators-and-tools/super-yoursuper…https://www.barefootinvestor.com/articles/qna/best-returning…
victoria devine and her "she's on the money" podcast has plenty of educational stuff too
https://www.shesonthemoney.com.au/podcast-index
"Today we're dropping this bonus episode in to get you engaged with what is possibly one of the BIGGEST investments of your life, superannuation":
https://podcasts.apple.com/au/podcast/its-time-to-get-super-…'Realised that I'm being ripped off since the last 5 years and I don't know where to move to'
unh - technical term 'ripped off' - generally suggests dodgy or unethical practice - not here explained what happened - but it seems the OP is simply asking for a better performing super fund choice ?
in my observation, those who don't pay attention to their super funds may lose by:-
a) having multiple small separate funds due to patchy career variety of jobs/employers/default super funds, where the monthly fees can exceed the growth over time
b) not noticing that the default life insurance deducts $X per month automatically, and if your super contributions are very small, the balance may actually go backwards over time to zero … ?
c) choosing 'cash' option as 'safest, right?' - not realising that cash returns averaging like 2.5%pa lose value over time compared to inflation which has averaged more like 3.5%pa over time - so losing 1%pa - great investment ?
I changed my super to International Equities which showed returns of 13%pa over the last 10 years, and nearly 23%pa last year. So maybe choose a growth investment.
"if you don't plan your life, your life becomes part of someone else's plan"
Compare the pair.
Take two stereotypical employees working in the same role at the same company and ask to view their super account balances.
Hostplus will cost you $72 per year, no percentage of balance fees.
They have a great selection of low fee index fund options.
Make sure you manually select an index fund you like, DO NOT STAY in the default option.Spaceship Super. Given your age, opt in to the GrowthX portfolio, and stay strong as it is a relatively volatile portfolio to some of the others listed above.
Note that admin costs are relatively low because it does not come with bundled insurance products like income protection, terminal disease and/or life. So if these are important to you, you will need to source these from an insurance provider. We have found that it is cheaper without these products bundles in to super and being covered outside of your super fund. YMMV.
Spaceship has very high fees compared to others.
take it all out (there are easy ways) , and invest it yourself
Move to a super fund that offers ‘indexed’ as one or more of their investing options.
They might be called ‘high indexed’ or ‘balanced indexed’
Fees will be lower (typically under 0.15%)
Returns typically will be higher than the managed investing options. (Which imo super funds ought to be embarrassed about).
Australian Super is very good
Been using hostplus, really happy with it so far. also really low fees.
one thing i did was determine I had no need for Death insurance (no dependants) so removed that. I kept the Total Disability cover though. halved the amount coming out of my super for insurance each month.
i've also moved from managed funds to index fund for lower fees. Host Plus made this process easy.
Is moving super when have insurance a pain
, as they need to reassess insurance policywithin the cha cha community there's cha cha super, it's pretty good and does a lot of cha cha returns for you. You may want to try cha cha super - shake your funds babe!
hostplus balanced index - one of the lowest fees
looking for a alternative to Australian Retirement Trust. When i was with sunsuper before they merged I could easily request 10k of my super due to financial hardship. Now ART want to know everything and provide proof of overdue bills. Im wanting the 10 k so i don't get overdue bills?
I was with QSuper for over 20 years. It was great.
Then it became ART and it all turned into $h!t
They have a lot of stupid TV ads now though…
I don't know why, but it seems that nothing that is good lasts.
Run from ART ASAP!Apologies for necroposting, what's wrong with QSuper/ART?
It used to be great when it was QSuper.
After becoming ART the customer service has gone really downhill. Long waits on hold. It takes ages to get a reply for any query.
And they changed all investment in line with woke government policies rather than to maximise members' returns. They even invest to support government policies.
They now have a lot of stupid ads on tv, but no longer care about members.
The appointment of Andrew Fraser, former Labor treasurer as chairman of the board is the icing on the cake.
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I switched to Aware Super because AustralianSuper annoyed the crap out of me,
https://aware.com.au/member/why-choose-us/join-aware-super