HESTA points to historic $20K super switching cost

Mike Taylor

Managing Editor and Publisher

8 April 2026

A surge in the number of members switching investment options has prompted major industry fund HESTA to warn against making snap decisions during times of market volatility.

In doing so, the fund has referenced the fate of members who switched investment during the COVID-19 pandemic resulting in members on average being $20,000 worse off.

It referenced its analysis of data which show that if a member with a $100,000 balance switched from the most popular option, the default MySuper Balanced Growth, to the most defensive Cash & Term Deposits option during COVID in 2020, just five years later they could be more than $20,000 worse off in terms of potential retirement savings.

HESTA clarified that this figure assumes the members took a year to switch back.

The warning sounded by HESTA has come on the back of it reporting a nearly 37% increase in visits to its investment landing page and a commensurate rise in investment switching.

HESTA chief executive, Debby Blakey said the fund is urging members to stay focused on long-term retirement goals amid the volatility arising out of the Middel East.

Noting the increase in switching behaviour, HESTA said that it had peaked on 9 March when oil prices jumped through US$110 per barrel and the ASX200 fell 2.8% on its worst day since the US trade tariffs were announced in April, last year.

It said members had predominantly moved their retirement savings into very defensive options such as cash and term deposits.

Blakey said it was natural to feel concerned during periods of market uncertainty, however making snap decisions based on short-term market fluctuations could harm retirement outcomes in the long run.

“We understand news of the conflict in Iran and the impact on global markets can feel unsettling, but history shows staying invested through market ups and downs typically delivers stronger long-term returns for our members,” she said.

“Super is a long-term investment. While it’s important to stay informed, knee-jerk reactions to short-term market movements can crystallise losses and risk missing out on a market bounce back. This could potentially cost tens of thousands of dollars at retirement.”

Blakey said the best thing members could do if they were feeling anxious was to seek advice tailor to their individual circumstances.