Super funds down in February – but it could have been much worse

Super funds lost further ground after a tumultuous February, but a mid-month turnaround in share markets limited the damage.  The median growth fund (61 to 80% allocation to growth assets) ended up retreating just 0.4%, bringing the return over the eight months of the financial year to date to -1.6%.

Key highlights include:

There has been much attention to the share market falls in the early part of this year but members need to remember that superannuation is for the long term.  The typical return objective for growth funds is to outperform inflation by 3.5% per annum over periods of five years or longer, and funds have been delivering on this promise for a very long time.

The lower return / higher volatility environment we’re currently in is likely to continue for some time given the shaky economic backdrop.

Industry funds and retail funds produced broadly similar results in February, with returns of -0.4% and -0.5% respectively.

Read full report.

Source: Chant West

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Tax changes will make property disproportionally popular with SMSFs: FAAA

Tax changes will make property disproportionally popular with SMSFs: FAAA

CGT changes proposed in this year’s budget could lead to more high-pressure sales tactics that push people into SMSFs, according to the Financial Advice Association Australia. While the association welcomes superannuation being exempted from any changes, it could mean property in SMSFs becomes disproportionately attractive.

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