investor daily logo

Aware Super default fund returns 10.7%

By Keith Ford
3 minute read

Super funds’ strong financial year member returns continue, with Aware Super returning 10.7 per cent on its default MySuper Lifecycle option.

Aware Super reported that its default MySuper Lifecycle option for members aged 55 and under returned 10.7 per cent for the 2023 financial year.

The MySuper option is a lifecycle product that actively steps down risk as members near retirement age. Up to age 56, default members are invested in high growth.

The fund, which boasts 1.1 million members and $160 billion in assets under management (AUM), said while the result was strong, there are still challenges ahead.

Damian Graham, chief investment officer at Aware Super, said: “We’re pleased to have delivered such a strong return for members at a time when the global economic backdrop remains clouded and after a year characterised by further market volatility.

“That volatility was particularly pronounced early in the financial year, then receded later in the year despite continuing inflationary pressure and rising interest rates.

“There are signs inflation might now be easing, but it’s too soon to suggest those economic pressures are going away so we’ll be as vigilant as ever in prudently managing our members’ investments for the long term to help set them up for their best possible retirement.”

Mr Graham joined the chorus of other super fund CIOs that stressed it is long-term performance that members need to watch, rather than single-year results.

“While it has been a strong year, we’re always at pains to emphasise the importance of focusing on returns over the long term rather than those for any single year, and indeed, our high growth option — which younger members with our MySuper Lifecycle product are invested in — has averaged 9.3 per cent per annum over the past decade,” he said.

“This serves as another important reminder of the value in taking a long-term view of your super. If your circumstances haven’t changed, staying the course with your investment option can be the best approach in the event of market volatility — a fact worth remembering given the economic outlook remains uncertain.”

On Friday, research house SuperRatings published its estimates for June’s super fund returns.

The median balanced superannuation option delivered a 1.2 per cent return during June, strengthening an already positive annual return to 8.5 per cent for the year to 30 June 2023.

Commenting on the results, executive director of SuperRatings Kirby Rappell said: “While there are significant conversations about interest rate rises, inflation, and global uncertainty front and centre within the economy, it is reassuring to see superannuation funds’ ability to deliver a competitive outcome for everyday Australians.”