Super funds offer a wide range of investment options, but the trick to is choosing the right one for your situation. Luckily, super funds provide a range of super calculators to help you work out your tolerance for risk. They will ask your age, when you aim to retire and a host of other questions, like:
Whether significant growth is more important to you than protecting the value of your investments;
Whether you would rather risk losing money than having lower return
Whether you are familiar with investment principles and economic issues;
Whether you are comfortable with your investments rising and falling with the markets.
To get the most of our your super, you need to check where your super is invested and understand your risk profile…
Use a super calculator
“You put in the variables and it will tell you what sort of an investor you are,” says SuperRatings’ Jeff Bresnahan says. “Once you come up with something like that – I’m aggressive and I don’t care if lose 40% – you can basically pick from a fund’s menu. If you like shares, for example, a lot of super funds will have a diversified share fund, a mix of Australia and international shares, and that’s a good one because you diversify a little bit but you are still 100% in shares.”
Understand your investing time frame
“Know how long there is before you need to access your super and how long you will be in retirement,” says Quantum’s Claire Mackay. “The longer your time frame, the more risk you should be prepared to take.”
Also understand your appetite for risk and make sure your various asset classes reflect this.
Some funds have what is called self-driven advice – use it!
“That’s where you can go on and find out what your invest strategy should be and how much insurance you should have, or whether you are contributing enough to super,” advises Bresnahan. “You can actually do that and come out with a statement of advice.”
Contact the fund’s call centre for general advice
“If you ring up and say I’m not sure which investment option I should be in, can you help me, they generally can.”
Once it moves into the realm of personal advice you will be referred to a financial adviser.
