Australian Ethical Super Returned 14 Percent in 1 Year

BluebirdV on 29/01/2025 - 14:17
Last edited 29/01/2025 - 14:24

I was looking at my Superannuation and in the past year it has grown 15 percent if you include about $700 in contributions so more likely 14 percent. My portfolio is 34 percent International Shares, 34 percent Australian shares and 32 percent high growth. Based on past performance am I likely to see similar returns long term? Interested in people's opinion whether I am making a good choice for someone in their 40s. Could I do better elsewhere?

I'm thinking of a self managed super fund so I can allocate some to crypto. What are the best options for a self managed super fund? Am I better off keeping this super fund open at the same time as a self managed fund to diversify and get high performance or are the fees not worth it? I'm only paying $5.78 a month in fees approximately on Australian Ethical.

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Comments

  • Duckie2hh on 29/01/2025 - 14:31
    +15

    Based on past performance am I likely to see similar returns long term?

    Past performance is not an indicator of future performance.

    whether I am making a good choice for someone in their 40s

    Yes*.

    Could I do better elsewhere?

    Depends on fees and performance.*

    I'm thinking of a self managed super fund so I can allocate some to crypto

    How much do you have in super?*

    are the fees not worth it?

    Depends.*

    *This is not financial advice. Past performance is not an indicator of future performance.

      • May4th on 29/01/2025 - 15:50
        +11

        it's not a disclaimer. OP specifically asked "Based on past performance am I likely to see similar returns long term"

        extra points for replying to your own comment because negs hurt your feelings

        • askbargain on 29/01/2025 - 16:39
          -6

          it's not a disclaimer

          If it’s not a disclaimer, then why is it listed on fund’s disclaimer page

          https://www.australiansuper.com/terms-of-use-and-disclaimer

          Or on Australian Ethical

          • Past performance is not a reliable indicator of future performance. Refer to our Managed Funds performance, Super performance, Pension performance and ETF performance for more detailed information on performance, including what we mean by "healthy" or "strong".
          • May4th on 29/01/2025 - 16:49
            +5

            @askbargain: duckie's response to OP is not a throwaway disclaimer but a direct response to OP's question which I've already quoted above. we all know what the disclaimer is and where it's used. I hope this helps you

              • May4th on 29/01/2025 - 16:59
                +4

                @askbargain:

                Past performance is not an indicator of future performance.

                A proper answer would be that past performance is not a guarantee of future performance.

                Previous performance is absolutely an indicator of future performance

                I think everyone knows what the three statements mean. It's interesting that you think only you know this and feels the need to educate the masses. and to answer your question, 1 year of 14% absolutely does not mean much at all in the fund management world. just look at Cathy Wood

                • askbargain on 29/01/2025 - 17:01
                  -4

                  @May4th:

                  It's interesting that you think only you know this

                  it's not a disclaimer.

                  Clearly you don’t. Also the first and last statement contradict each other ¯\_(ツ)_/¯

                  1 year of 14% absolutely does not mean much at all in the fund management world

                  I wasn’t speaking to this but more the general statement about past performance

      • brendanm on 29/01/2025 - 17:56
        +3

        No, it's just common sense.

        • askbargain on 29/01/2025 - 18:39

          Then why do people do momentum investing or backtesting?

          • brendanm on 29/01/2025 - 19:23
            +3

            @askbargain: No idea what you are talking about. Investments can go up and down, they are unpredictable.

          • May4th on 29/01/2025 - 20:45
            +3

            @askbargain: zoom out and look at their 10 year performance and fees

          • Crow K on 30/01/2025 - 11:06
            +1

            @askbargain:

            Then why do people do momentum investing or backtesting

            Because they graduated from the TikTok University of Looking At Price Charts?

            • smalltime0 on 30/01/2025 - 16:17
              +1

              @Crow K: "buy the dip"
              "to the moon"
              "Doge at $100 by year end"

              • May4th on 30/01/2025 - 16:21

                @smalltime0: FARTCOIN to $69!

                • smalltime0 on 30/01/2025 - 16:23

                  @May4th: Can FARTCCOIN reach $420? Let's ignore that it would give it a market cap of $420 billion for one second and just wildly postulate.

  • JimB on 29/01/2025 - 14:32
    +7

    "Based on past performance am I likely to see similar returns long term?"

    no.

    8% is a good long term return.

    With crypto. Invest in what you can afford to lose, not your retirement.

  • Fredfloresjr on 29/01/2025 - 14:39
    +8

    Load everything at Sportsbet

    • CptnObvious on 29/01/2025 - 15:07
      +1

      ASX:SGR

    • Cluster on 29/01/2025 - 17:26
      +3

      Chances are you're about to lose.

      (If only people actually paid attention to the warnings)

      • smalltime0 on 30/01/2025 - 16:21

        "All of these bets are basically an assured win, so really the only risk is this bet that pays $1 : $1.1 - but the slip pays out $1 : $175"
        "I would've been paid out almost $8k, but this bet $1 : $35 on the slip didn't happen and it was basically an assured thing"

        -Actual things I've heard at the pub.

    • Indiana1501 on 30/01/2025 - 12:48

      Everything on Red!

    • crentist on 29/01/2025 - 14:54
      +7

      If returns are about the same, why not invest into less terrible companies?
      Especially if you're the type to whinge about unethical corporate behaviour, like price gouging

      • Duckie2hh on 29/01/2025 - 14:57

        Not all returns are the same.

        • crentist on 29/01/2025 - 15:01

          I based that on this statement: "hard to find a growth option that didnt return around 14% over 12 months" which contradicts the point that was being made

      • Gdsamp on 29/01/2025 - 15:00
        -3

        Especially if you're the type to whinge about unethical corporate behaviour, like price gouging

        There is no ethical consumption under capitalism so you might as well benefit from it in your retirement

        • fantombloo on 29/01/2025 - 15:06
          +1

          There is no ethical consumption under capitalism

          True, but without a reasonable possibility to opt out there is still better and worse, and the "benefits" may not even be commensurate with worse.

        • crentist on 29/01/2025 - 15:28

          But you said all returns are about the same, so it wouldn't matter much which fund you go with.
          If there was a marked loss to ethical investing then fair enough. But Aus Ethical seems to be a consistent performer, although the fees are a bit high :/

          I agree that none of it is great, so my interpretation of "ethical" is that it's relative. There's the hope that some variations in return (within reason) are balanced out by disincentivizing some of the more egregious behaviour, so that I won't have to spend my retirement dodging grimy balls of shit every time I go to the beach. Just, every few months like I do today.

          • BluebirdV on 29/01/2025 - 18:06
            +1

            @crentist: Roughly $5.78 a month in fees doesn't seem like much. That's what I've been paying in Australian Ethical. Is it possible there are hidden fees?

    • jv on 29/01/2025 - 15:02
      +1

      hard to find a growth option that didnt return around 14%

      True, my 'balanced' fund returned 14% over that period.

    • BluebirdV on 29/01/2025 - 15:12

      Why not if returns are high?

  • BluebirdV on 29/01/2025 - 15:11

    I'm curious to know what are the top 5 performing funds long term? Is Australian Ethical in the top 5? Are they likely to stick around long term.

    • sumyungguy on 29/01/2025 - 15:47

      Ranked 19 in APRA's MySuper product 2024 performance test, 10 year net investment return. Could you do better elsewhere? Depends not just on performance & fees but also any insurance cover you hold inside super and the actual policy details. You only put in $700?

      • BluebirdV on 29/01/2025 - 19:36

        Last year but a lot more in previous years. Not paying for insurance at the moment.

    • nahkk on 29/01/2025 - 19:03

      ATO has "YourSuper comparison tool" but it does not compare all the products and portfolios. I think it should give you a good idea.

  • mskeggs on 29/01/2025 - 16:04
    +4

    It's great you are taking an interest in your super.
    It is unlikely these great returns will be consistent long term, simply because they have been so above usual.
    If you are making such small contributions and have such a modest balance, a SMSF is unlikely to be a good move. They are a hassle to run and compliance costs will make the actual fees much higher than what you currently pay.

    If you are focused on retirement savings, additional contributions are a great avenue. And remember if you are a low income earner the government will pay $500 if you contribute $1000 after tax.

    The good thing about super is it is low tax and the default funds are well diversified - a really sound footing for retirement savings.

  • Drpepper666 on 29/01/2025 - 16:50

    Put 100% super in $TRUMP coin, he's about to make it the USA strategic crypto reserve

    • Cluster on 29/01/2025 - 17:25

      I'm all in on $FARTCOIN and long beans

  • askbargain on 29/01/2025 - 16:57

    If you don’t care about ethical investing, you can get higher returns

  • netjock on 29/01/2025 - 17:03
    +1

    Sure you super provider could give you a 10 year average of each option then you just need to do basic maths.

    Last year doesn't make a trend. But my guess is half of Australia thought 2% mortgage rates were going on until infinity years in 2020/21.

  • Cluster on 29/01/2025 - 17:25

    2024 was an exceptional year. Don't expect 2025 and 2026 to be similar.

  • Seraphin7 on 29/01/2025 - 17:30
    +4

    My portfolio is 34 percent International Shares, 34 percent Australian shares and 32 percent high growth.

    The "high growth" component is likely predominantly some mix of the other two. You may wish to investigate this.

    Based on past performance am I likely to see similar returns long term?

    You won't get that sort of return over 5 to 10+ years. Long run, and for these investments, something closer to 8% would be expected, but with the potential for variation in any 12 month period for anything from +40% to -40% (if not wider in the most extreme scenarios).

    Interested in people's opinion whether I am making a good choice for someone in their 40s.

    It's the sort of investment mix you would typically recommend for someone in that age group.

    I'm thinking of a self managed super fund so I can allocate some to crypto.

    It sounds like your investment balance is ~$70k (based on $700 in contributions causing a 1% lift in balance). You're likely going to be paying significantly higher fees in an SMSF than you are currently. Whether or not any returns from crypto make this beneficial for you is speculative. (A separate question is why you only have $700 a year in contributions going in?)

  • brendanm on 29/01/2025 - 20:13

    $700 in contributions

    You may want to discuss this with your employer or fairwork, unless you only worked for a very small portion of the year.

  • floorpie on 30/01/2025 - 10:09

    If I was starting self managed super for myself I would invest in a US technology ETF. QQQ and VGT both grew 20+% over the past year. Technology companies are where the most innovation is going to happen, which leads to more long term growth.

    Would mean less of a focus on ethical investing though.
    Also you should look up how much it costs to set up and run a SMSF, I believe it is over $1k/year.

  • bbinc on 30/01/2025 - 12:07
    1. Well done for checking out your super and considering options.
    2. There are two main ways to setup an SMSF. You can just sign up with a provider who you think will do it all (they may, but you are the responsible enitity for ensuring the rules are followed), or you can spend the time to read and understand the complexities and reporting requirements and then deciding what skills you want to employ to help you - advisors, accountants, auditors etc.
    3. Whichever way you choose, you need enough knowledge to understand what your providers are doing and whether they are doing it properly. I started with a major well-known firm 20yrs ago, but within two years discovered they had dropped the ball, and took it over myself (they crashed and lost people’s money). You need to learn a lot, which is great if you enjoy that.
    4. An SMSF is a LOT more than just what you invest in. It’s one of the many superannuation platforms you can use, it can be dearer or cheaper to manage. Your $5.78 pm in AE will be the admin fee, an SMSF will have a minimum of $1200 p.a for admin but can be thousands more. Both will then have investment fees which vary widely depending on where you invest. Broker fees if you DIY, ETF costs, or for AE each of your three options will have a fee (look in their PDS for investment costs).
    5. Check out comments above by Mskeggs and Seraphin7 - both are right on the ball.
    6. I put Crypto, Sportsbet and Lotto in the speculative category (and use only Lotto as a bit of fun), not serious retirement plans.

    Keep thinking and researching, buy or borrow some Australian books on super, and don’t jump until you don’t need to ask for OzB opinions. There are some experienced people here happy to help you on your way.

  • BrisneyLand on 30/01/2025 - 12:40

    Based on past performance am I likely to see similar returns long term?

    • Nobody has a crystal ball, but the share market will go up over the long term (>7-10 years)

    Interested in people's opinion whether I am making a good choice for someone in their 40s. Could I do better elsewhere?

    • Your fees are < 1% - stay where you are - AES is fine. Swap it to all high growth though. You've got plenty of time to ride to volatility until you retire.

    I'm thinking of a self managed super fund so I can allocate some to crypto. What are the best options for a self managed super fund? Am I better off keeping this super fund open at the same time as a self managed fund to diversify and get high performance or are the fees not worth it? I'm only paying $5.78 a month in fees approximately on Australian Ethical.

    • Based on your returns including $700 contribution was 15%, then I'm assuming your balance now is around $85k? That is not enough to open an SMSF. You need roughly $250k at least as fees are around $2500/yr. Stay in AES and shift it all to high growth, it is well diversified, and you've got 20 years until you retire, so plenty of time to ride out any volatility. I would steer clear of crypto for super, but if you do allocate any to crypto, keep it <5% of your overall balance. Losing 5% is not catastrophic.
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