“Superannuation: what a waste of time!”
That was the general consensus of readers responding to an online news article that superannuation returns had averaged 3% over the last 13 years.
I’d have to agree – if I saw things as black and white as they did.
However, there’s a little more complexity to the issue.
Superannuation is not an investment; it’s a tax structure to accumulate money for retirement.
How people choose, or not choose, to invest the assets in their superannuation will have a large bearing on those returns, and that’s important to remember.
It’s a given that some funds will perform badly, while others perform well.
Unfortunately there are a great number of stinker funds dragging that average down, but if it’s your superannuation, you need to take control of it.
Decide on the fund, decide on the asset allocation and hunt down those lost super accounts.
At last count there’s over $12 billion sitting in lost accounts, just being eaten away by fees and charges.
That’s a lot of retirement money being flushed down the drain, could any of it be yours?
Hopefully you can see what I’m getting at here, while dud funds may form part of the poor returns problem, simply blaming ‘superannuation’ as a concept hides the personal responsibility involved in planning and investing for retirement.
Many people don’t even know their superannuation asset allocation.
While it’s not popular to say, we must do better than taking little interest, then screaming with disgust when the returns are below expectation.
When confronted with that measly 3% return many people responded, “I’d do better leaving my money in cash.”
Well cash is a part of superannuation, while it wouldn’t be my choice to go 100% cash, it certainly is available.
Take an interest, the choice is yours.
Peter Mancell is a director of Mancell Financial Group and FYG Planners AFSL 224543. This information is general in nature and readers should seek professional advice specific to their circumstances. We think we’re Tasmania’s best financial adviser and If you’d like help with your superannuation, we ‘re one of only six certified fiduciaries in Australia.
