Where you invest your superannuation is a big decision, one that could have a significant impact on your retirement nest egg.
The difference between choosing a high-performing fund and a low-performing fund could add up to tens of thousands of dollars over the course of your career.
Oliver* recently switched his superannuation to Virgin Money Super, because he was already banking with Virgin Money and he was impressed with how their different superannuation investment options had recently performed.
Here’s how Virgin Money Super’s different investment options performed over the year to 31 July 2019, compared to industry funds and retail funds, according to data published by Virgin Money:
|Investment option||Industry fund median||Retail fund median||Virgin Money Super|
|Indexed Australian Shares||9.94%||10.02%||13.20%|
|Australian Listed Property||7.04%||15.67%||18.84%|
|Indexed Diversified Shares||7.69%||7.40%||10.32%|
|Indexed International Shares||7.04%||7.82%||11.02%|
|Enhanced Indexed Growth||7.31%||6.73%||9.34%|
|Enhanced Indexed Conservative Growth||5.75%||5.33%||7.95%|
Past performance is no guarantee of future performance
Past performance is no guarantee of future performance. So while Virgin Money Super outperformed the industry fund median and retail fund median over the year to July, it doesn’t guarantee that Virgin Money will do so in the future.
Also, superannuation is a long-term investment that can be quite volatile, so it’s often a good idea to compare super funds over, say, five years or longer.
Oliver wasn’t able to do that with Virgin Money Super, because its investment history goes back to December 2016. However, he did find the following data published by Virgin Money:
|Indexed Australian Shares||1 December 2016||12.86%|
|Australian Listed Property||1 December 2016||12.57%|
|Cash Option||1 December 2016||1.88%|
|Indexed Diversified Shares||16 December 2016||11.11%|
|Indexed International Shares||1 December 2016||13.61%|
|Enhanced Indexed Growth||22 December 2016||8.86%|
|Enhanced Indexed Conservative Growth||23 December 2016||5.89%|
How to switch super funds
Oliver found it a simple process to rollover (i.e. switch) his superannuation from his previous fund to Virgin Money Super.
Oliver completed the rollover process online, by providing this information:
- Contact details
- Tax file number
- Membership details of his previous fund
By joining Virgin Money Super, Oliver became eligible to earn Velocity frequent flyer points.
Virgin Money gives members 1 Velocity point for every $5 of net super contributions they make during a points earn period (which lasts three months), up to a maximum of 250,000 points during any financial year. (Other conditions also apply.)
Oliver transferred $50,000, which meant he immediately earned 10,000 Velocity points.
* Oliver is not a real person. This is a hypothetical case study.