Who are the best super funds in Australia?
Which super fund are you with? Did you choose it yourself or was it selected by your employer? Have you ever conducted research to see if it is an acceptable one for you? How do you compare super funds?
These are essential questions that you need to be considering.
In this video and article, I will walk you through the six most popular comparison websites for super funds (more than 350 offerings). I will compare both the performance and the fees across all offerings and find out which super funds are the best.
The Comparison Sites for Super Funds
If you prefer reading this article to watching the video, please continue reading below.
Don’t Care Which Super Fund You’re With? Big Mistake!
Super is perhaps one of the most critical factors of retirement planning in Australia. Regardless of this, most people don’t really care about it and brush it off as something not worth looking into. This ignorance is perhaps the biggest retirement problem in Australia.
Here are some questions for you to gauge how much you care about your super:
- What is the current balance of your super fund?
- How much fee did you pay last year? Was it over $1,000?
- How has the fund been invested in? Australian stock markets or international ones? Or bonds?
- What are the returns of those investments last year, or the previous five years?
I’d wager that many people would not be able to answer all of those questions.
However, when they retire or begin planning retirement seriously, they then realise that those previously abandoned questions are actually critical in retirement planning and the key to a happy retirement.
Is My Super Good or Bad? How Do I Determine This?
Rating a super fund as ‘good’ or ‘bad’ is quite complicated. Each super fund offers different fees and options, and their investment performance also differs from the others. There are several factors that characterise a super fund.
Fortunately, ASIC’s MoneySmart (the independent government organisation) sets a good starting point. They suggest to consider the following 6 main factors when comparing super funds:
The above table may appear like a long, complicated list. A simple way is to consider two main factors – a super fund’s fees and investment performances. The other factors are often similar to each other, or their impacts are not as substantial as fees and performance.
How To Find The Best Super?
Did you know that there are more than 350 offerings across super funds and their products in Australia? You wouldn’t compare them manually, would you?
Some of the comparison sites share the details on how they compare the super funds. The links below show their methodologies.
In the following tables, I list the best super funds from each of those comparison sites.
Best Super Funds By Canstar
The following super funds are rated as five stars at the Canstar website (as of 15 July 2019). I set the search filters as Age: 50-59, Super Balance:$100k – $250k.
Best Super Funds By RateCity
Unfortunately, RateCity does not give overall ratings due to multiple factors. Here’s how I find out the best ones considering both low fees and high performance.
- First, I obtained the list of best super funds at RateCity, using the search conditions of Age: 50-59, Super Balance:$100k – $250k.
- Next, I calculated the median value of the fees across all of the offerings. Likewise, I also calculated the median value of the performances.
- I then extracted the super funds below the median value of the fees and above the median value of the performances.
This gives me the following top 20 super funds (as of 15 July 2019), not sorted by any measure.
Best Super Funds By Chant West
Chant West classifies the super funds into bronze, silver and gold apples, according to their rating system. The gold apple class includes 56 funds, and this list is based on name only for each super fund. For example, UniSuper is on the list with Accumulation 1, Accumulation 2, and the Personal Account.
In the following, I list only the fund names (as of 15 July 2019):
Best Super Funds By Morningstar
MorningStar also offers a star rating over the super funds. I first extracted the 5-star funds, and then selected only the fund names, instead of each product, as I did for the best fund list by Chant West.
Please note that their rating is mainly based on investment performances only. The list below is up-to-date as of 15th July 2019.
Best Super Funds By SuperRatings
At the SuperRatings websites, you can find the top 10 funds (5-year, default investment option) for performance and fees (balance of $50,000), respectively (as of 15 July 2019).
Best Super Funds By SelectingSuper
The list is up-to-date as of 15th July 2019.
Can you spot your super fund name in the lists above?
If your fund does not appear multiple times across the lists, you could consider changing your super fund, if possible. The savings from switching such super funds can be substantial. You may even be able to retire years earlier with all those extra savings!
The barefoot investor claims that you can save more than $240K by switching super funds.
In fact, my husband actually switched his super fund after reading the book. Yes, we found huge potential savings! I share the details about this in my other article. Check this out: Change Super To Save $225,484 – Barefoot Investor Secret
Let’s save more and retire early!
I hope this article helps you to determine which super funds are good and if you are currently with an inadequate fund. If you subscribe to our YouTube Channel, you will get notified when a new video is released. You can also find us on Facebook.