Understand super investments

We invest the money in your super based on the investment choices you make to help it grow, so that you can achieve the retirement you want. 

Your super is typically considered a long-term investment, specifically designed to help you save for retirement.

During your working life, your employer will make regular contributions to your super account as required by the Superannuation Guarantee (SG). You can also add extra money to your super; this is commonly referred to as ‘making super contributions’. 

It's worth taking an active interest in your super savings during your working years. It's your money and your super's investment performance over time will impact how much you eventually have in retirement.

Understand more about why superannuation is a long term investment

understanding super illustration

The money in your super is invested across a variety of different investment types.

These investment types are a key factor in determining rates of returns on your super. Defensive investments, like cash and fixed interest, offer lower risk with lower returns. Growth investments, such as shares and property, are typically considered higher- risk investments that can carry potentially higher returns.

Generally, when you’re younger, you may be prepared to invest in higher-risk growth investments as you have time to recover from potential losses along the way.

On the flip side, if you’re heading towards retirement (or are retired), you may be less willing to invest in higher risk assets. Instead, the lower-risk, defensive investments may be more appropriate, as they help cushion your capital from investment volatility.

Learn about investing through different life stages

The magic of compounding

When it comes to investing, regularly adding money, and investing for longer can make a substantial difference. This is due to the concept of compound interest where you make money on your initial amount, and again on any growth that is generated. This can be very powerful over time.

Super is generally locked away for decades and with regular contributions via SG payments, or personal contributions, it becomes a great investment vehicle to take advantage of the magic of compounding.

So regardless of whether share markets are rising today or falling tomorrow, it’s generally anticipated that over the course of your life, there will be more years of positive returns than negative ones, and the aggregated returns will compound each year, likely resulting in a balance at retirement that is greater than the amount that you contributed throughout your working life.  

Tax benefits mean more money goes towards your retirement

Money in super is taxed at a concessional rate of 15%. This can mean more of your money goes towards your retirement than if you were to invest outside of super.

The concessional rate could apply to contributions made into your super, as well as to earnings that are generated by investments in your super. This is potentially lower than the personal tax you would pay on your income.

More to the point, once you’ve retired, in most cases, you no longer need to pay tax on the earnings generated by the investments in your super.

Diversifying your retirement savings

Having your super invested by an expert means it will generally be invested into a range of different markets, asset classes, and investment managers.

It’s a good idea to diversify your investments because each investment is likely to react differently to the same event. And although this approach can’t guarantee returns, it may help you reach your investment goals over the long term, whilst minimising risk.

When you diversify your investments, it means you’re not placing all your eggs in one basket. This is important because super often forms a big portion of your retirement savings, to live on once you’ve stopped working.

Super is likely to be your second largest asset, after your home, which means there’s no better time to review your superannuation strategies than the end of financial year.
We have been investing sustainably at BT for many years, focusing on how we can reduce our impact on society and the planet.
Most major investment markets rose over FY21, with several hitting record levels as economies returned to pre-COVID levels of growth – which is good news for BT super members.

Things you should know

This information has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation, and needs.

Superannuation is a long-term investment. Generally, contributions to a superannuation fund are preserved. The government has placed restrictions on when you can access your preserved benefits. In general, benefits will not be able to be paid until a member is age 65, or has permanently retired and is above his/ her preservation age (i.e. 55 years up to 60 years depending on when the member was born).

The Government has set caps on the amount of money you can add to superannuation each year on a concessionally taxed basis. Contributions that exceed your contributions caps may have additional tax applied to them. The contributions caps change from time to time. Up to date information is available on the ATO website at ato.gov.au.

Before requesting a rollover, you should consider where your future employer contributions will be paid (if your employer contributions are currently being paid to another fund) and check with your other fund(s) to determine whether there are any exit or withdrawal fees for moving your benefit, or other loss of benefits (e.g. insurance cover), noting that you may not receive the same type or level of benefits after the rollover. You may not be covered for injuries or illnesses that have arisen since you took out previous insurance, and you may lose loyalty benefits.