Super members get a $140 billion boost through strong returns

Super has recovered from the GFC and then some.

Super has recovered from the GFC and then some. Photo: Getty

Superannuation fund members are in line to discover a $140 billion boost to their accounts in the next few weeks as statements go out for the financial year to the end of June. And fund values are now 52 per cent above their pre-GFC peak without contributions being considered.

The latest boost is the result in cold, hard cash coming from the eighth consecutive year of positive super returns that saw overall rises of 10.7 per cent. Industry funds topped the pool once again with average returns of 11.15 per cent while retail funds made 9.7 per cent for the year, according to the latest performance tables from SuperRatings.

That outperformance meant that industry funds dominated the performance tables with the $23 billion HOSTPLUS in first position, delivering a return of 13.2 per cent to its 1 million members. AustralianSuper, the country’s largest fund with $114 billion in super savings, delivered 12.4 per cent to its 2.2 million members.

All of the top 10 funds in the SuperRatings survey were industry funds and that sector has outperformed the for-profit retail funds for the past 15 years.

Source: SuperRatings

“At a time when inflation hovers below 2 per per annum, Australian super funds continue to far exceed expectations, with accrued earnings of well over 100 per cent since the end of the GFC,” SuperRatings’ Chairman, Jeff Bresnahan, said.

“Over the last 5 years alone, funds have averaged 10 per cent earnings every year, more than erasing the pain of the GFC and putting retirees in a significantly improved position than they could ever have hoped for.”

How the funds have recovered from the GFC.

The median balanced fund lost 25 per cent of its value between October 2007 and February 2009. But since then the median fund rally 103.6 per cent. This now places the median balanced fund 52.6 per cent above the pre-GFC peak, SuperRatings has found.

This is before contributions are considered.

However, the range of returns delivered by funds remains a key differentiator across the market. The top performing balanced fund added a further $24,855, or 16.3 per cent, to the median fund size since the GFC.

However there was a $56,112 gap between the top and bottom performing fund, which meant that the bottom performing fund did not even exceed inflation over the past 10 years.

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