SUPERANNUATION

Ask Paul: I'm 74 - should I change super funds?

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Dear Paul,

I  have been with First State Super for 35 years and it is now called Aware. I am 74 and thinking of retiring.

I would like to take your advice and sit in a low-cost super fund. Can you advise if AustraliaSuper is a better fund? - Anna

ask paul clitheroe should i change super funds in my 70s

Anna, "better" is a difficult description when comparing a fund like Aware to a fund like AustralianSuper. Both have performed very well for their members. AustralianSuper has won many awards from Money and Aware was the Best Super Fund for 2022 in Money's Best of the Best awards.

Looking at long-term results, both funds have done a great job. It depends on which option you choose, but if we look at their balanced fund returns or growth returns, both have performed very well.

Frankly, with these huge funds, the reality is they invest in a very similar way in very similar assets. When you are looking after hundreds of billions of dollars, there is a pretty straightforward strategy.

They seek to own quality assets globally. This would include shares, bonds, fixed interest, property, infrastructure and so on.

Whether you go with AustralianSuper or stick with Aware is not really the key issue.

It is most important to choose the investment option that suits you best. Over the long term, a growth option should outperform a balanced option and conservative option should be lower.

This makes sense as risk is highest in growth and lowest in conservative. I'm 66 and my super is in a mix of balanced and growth. I hope to be around for a couple of decades, making me a long-term investor, so the long-term assets in growth and balanced options suit me best.

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Paul Clitheroe AM is the founder of Money and serves as the publication's editorial adviser. One of Australia's most trusted personal finance experts, Paul has spent decades helping Australians build wealth, manage debt and make smarter money decisions. He is widely known for host­ing the Money TV program and authoring best-selling personal finance books. Since launching Money in 1999, he has played a leading role in delivering practical, independent financial guidance to Australians. Paul is chair of InvestSMART Financial Services. He was the founding chair of Ecstra Foundation, a national not-for-profit focused on improving financial wellbeing, from 2018 to 2026, and led the Australian Government's Financial Literacy Board and Financial Literacy Australia from 2004 to 2019. In academia, Paul is chair in financial literacy at Macquarie University, where he is also a Professor in the School of Business and Economics. Ask Paul your money question. Due to volume, Paul cannot respond to questions posted in the comments section.
Comments
Cheng Ang
May 11, 2022 9.22pm

Dear.Paul

I am a retiree and my superannuation is invested with FirstChoice Wholesale Allocated pension.under CFSW Enhanced Index Con

And CFSWS Index Conservative.

I would appreciate if you would comment on both the funds and whether i should continue to stay with them and how efficient they are for a retiree like myself.

Thank you for your advice

Regards

Cheng

Money magazine
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May 12, 2022 9.40am

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Paul Clitheroe is unable to respond to questions posted here in the comments. Please submit your question via this link: https://www.moneymag.com.au/co...