Volatility proofing your super

On one hand, planning for retirement can be exciting. But on the other, it can cause anxiety. If market volatility would concern you, it might be worth taking a look at how your super’s invested, assess your retirement goals, and if needed, put a volatility lens on your super.

Key learnings covered in this topic

  1. Volatile investment markets may cause concern if you’re nearing, or living in, retirement
  2. It’s important to consider how much risk you’re willing to take to afford your retirement lifestyle and still sleep soundly at night 
  3. Once you understand your risk appetite you can determine your ideal investment strategy, and the investment option(s) right for you 
  4. CareSuper’s investment philosophy minimises the impact of negative returns when markets fall – this is called ‘downside protection’ 
  5. As part of your CareSuper membership you have access to super-related financial advice over the phone*, or we can consider your whole situation.^
     

Assess your risk appetite

It can be hard to know how much risk to take in the lead up to retirement? In general, the lower the risk, the lower the expected return. So, investing conservatively may help you avoid market lows, but it could also mean you miss opportunities to grow your balance.

To keep it simple, think about how much risk you’re willing to take to afford your retirement lifestyle and still sleep soundly at night.

If you need more help log in to MemberOnline and take our risk attitude quiz.

Choose an investment option that suits you

Once you understand your risk appetite you can then review your super investment strategy. CareSuper offers a range of investment options each with different targets for returns and levels of investment risk. They are made up of two separate asset types:

1. The first is what we call growth assets. These are generally made up of higher risk things like shares and property that are more aggressive with a value that can fluctuate over time. 
                                                                                             
2. The other type are defensive assets which are invested in more low risk assets such as cash and fixed interest. 

The more growth assets you hold the more likely your returns will be higher but also more volatile due to market forces.

To decide what will work for you look at the options available, drill down into their specific asset allocations and weigh up the average return figures.

Consider downside protection

As part of the CareSuper investment philosophy your super is invested to minimise the impact of negative returns when the market falls. This is called ‘downside protection’. Protecting against downside risk means your super is better prepared for market downturns, and you can be more confident about recovering losses. 

Market volatility may be making you anxious, but you can be assured that every effort is being made to smooth the waters. This is why CareSuper was the 2023 winner of the SuperRatings Smooth Ride Award.

Watch CareSuper Financial Advice Manager Dan Bridgland talk about choosing the right investment options to suit you and support your retirement goals.

Know that you’re not alone 

Market volatility can be unsettling but we’re here to help. As part of your CareSuper membership you have access to our limited financial adviser team* who can:

  • Assess your appetite for risk
  • Discuss your investment options as a CareSuper member
  • Help you understand if you're on track for retirement.

If you need more complex advice, then speak with our comprehensive financial advisers^. They’ll consider your whole financial situation, including your spouse, any assets you have outside super, your debts and your financial goals to help you plan your ideal retirement. 

At CareSuper, our role is supporting you, our members in achieving your retirement goals. So, if market volatility is keeping you awake at night, please give us a call. We can’t wait to hear from you.

 

*Financial advice obtained over the phone, or through MemberOnline, is provided by Mercer Financial Advice (Australia) Pty Ltd (MFAAPL) ABN 76 153 168 293, Australian Financial Services Licence #411766. 

^Advice is provided by one of our financial planners who are Authorised Representatives of Industry Funds Services Limited (IFS). IFS is responsible for any advice given to you by its Authorised Representatives. Industry Fund Services Limited ABN 54 007 016 195 AFSL 232514. 
 

Information correct as at 24 October 2023.