Super strength weathers market storm over 2024-25

Superannuation has managed to prove its investment power over the long-term, according to the latest Super Ratings results for the 12 months to 30 June.

The data analysed across several options confirmed international technology and Australian financial shares lead the pack for the last financial year, softening the blow of persistent market turbulence and allowing Australians to “find comfort in their retirement balances”.

Balanced funds with a growth allocation of 60 to 70 per cent of their portfolio are expected to generate returns in positive territory for members and more than half are expected to hit the double digits.

According to Super Ratings’ SR50 Balanced (60-76) Index for the year ending June 2025, the top 10 funds were:

1. Raiz Super Moderately Aggressive – 13.8 per cent
2. legalsuper – MySuper Balanced – 12.6 per cent
3. Hostplus – Index Balanced – 12.0 per cent
4. Colonial First State First Choice Wholesale Personal – Enhanced Index Balanced – 12.0 per cent
5. Vanguard Super SaveSmart – Growth – 11.8 per cent
6. Living Super – Growth – 11.7 per cent
7. Superhero Super – Growth – 11.7 per cent
8. ESSSuper – Balanced Growth – 11.3 per cent
9. Australian Retirement Trust – Super Savings – Balanced – 11.2 per cent
10. NGS Super – Diversified (MySuper) – 11.2 per cent.

“It’s pleasing to see a range of funds in this year’s top performers with some smaller funds showing their ability to deliver strong returns to their members through uncertain times” Kirby Rappell, Director of SuperRatings, said.

Similar results driven by the performance of the Magnificent Seven in the US and the Commonwealth Bank of Australia were also recorded by passive investment options in the Balanced segment:

1. Raiz Super – Moderately Aggressive – 13.8 per cent
2. netwealth Super Accelerator – BlackRock GSS Index Plus Growth Fund – 13.7 per cent
3. Aware Super Future Saver – Balanced Indexed – 12.7 per cent
4. Colonial First State First Choice Employer – Enhanced Index Balanced – 12.3 per cent
5. Brighter Super – Indexed Balanced – 12.2 per cent
6. AMP SignatureSuper – Balanced Index – 12.0 per cent
7. Hostplus – Indexed Balanced – 12.0 per cent
8. HESTA – Indexed Balanced Growth – 12.0 per cent
9. AustralianSuper – Indexed Diversified – 12.0 per cent
10. Australian Retirement Trust – Super Savings – Balanced Index – 11.8 per cent

For younger members aged 45, the default MySuper Lifecycle options held a larger allocation to growth and thus generated stronger returns.

“While higher exposure to growth assets has benefited members over the past few years, it also comes with increased ups and downs, and we encourage members to learn how their fund’s investment strategy works so they are comfortable with annual and long-term performance outcomes,” Rappell said.

Vanguard, Colonial First State, Essential Super, Virgin Money and AMP all reached the top five.

Sustainable options also managed to match their balanced counterparts in the last financial year, with Vanguard Super’s Ethically Conscious Growth option delivering the strongest returns at 12.6 per cent, followed by Aware Super Future Saver – Balanced Socially Conscious (12.3 per cent), UniSuper – Sustainable Balanced (11.1 per cent), Raiz Super – Emerald (SRI) (11.1 per cent), and HESTA – Sustainable Growth (11.1 per cent).

“With so many global events over the year there has been an increased level of uncertainty around fund returns this year,” Rappell said.

“However, superannuation is designed to build and maintain wealth for retirement and since most of us will have plenty of time until we retire and begin accessing our superannuation it is important to block out as much of the noise as possible and focus on how we are doing over the long term.

“This year has been a strong result, well above the long-term annual return of 7.2% since compulsory superannuation began in 1992. Converted into dollars, $1 invested in the median balanced super fund in 1992 would now be worth approximately $2.84.”

Rappell warned investors to check their super investment options and ensure their preferred selection remains suitable for their life stage; an option that can weather the ‘ups and downs’ is better suited for those further away from retiring, compared to one that should minimise exposure to market fluctuations for those approaching or near retirement.

“Protecting members’ balances from sharp falls is a key function of superannuation investment teams and grows in importance as members near retirement or uncertainty rises,” said Mr Rappell. “While some funds that were more defensively positioned didn’t benefit as much from growth over the year, having strong diversification helps shelter members from market fluctuations and supports smoother returns over the long term”.