Best Super Fund for Retirees

Currently, I use a financial advisor for my superannuation, but want to avoid his fees and move my funds to another balanced fund. I have around $400000 currently invested and am a retiring 65 yo. Any pitfalls or suggestions as to the best fund, less fees?


  • +6


    • Thanks

    • LOL

  • +1

    When you say a balanced fund, normally what that means to me is there is a mix of lower risk (but still with capital risk) units.

    Did you want that or more capital safe investments?

    • I was thinking balanced fund, but would you recommend a more capital safe investment?

      • +3

        You need to consider your own appetite for risk.

        The general thinking is one who is in the latter stages of their working life or retired have less ability to recover from the troughs of the market as they are no longer working.

        So if this pool of money represents an important part of your retirement, you may want to choose more capital safe investments.

        However with interest rates at historical lows, the returns are very small.

        There is no right / wrong answer for everyone.

        I have seen those in your age bracket throw caution to the wind and put their Account Based Pensions in riskier investments and rode the waves of a commodities boom, and their returns actually exceeded their pension payments.

        I have seem people put $1m into Super on the tail end of the mid 2000's boom only to be hit by the GFC and immediately lost 40%.

        Those 2 are extremes, it is up to you what you wish to expose your savings to.

        • +1

          Consider also that half the money the average person will withdraw from super is earned after they retire. So some measure of growth and accompanying risk needs to be accommodated.
          The average 65yro needs to fund 20+ years, hard to do without investment growth.

          For me, this would include dividend paying shares.

          As to which fund? It likely depends on your investment goals, and find the lowest fee one that provides the investments you want.

          If I was advising my mum, I would say stick it in an industry fund with a conservative mix of assets. But she would find managing investments more actively a hassle, so this isn't the right answer for everyone.

          • +3


            The average 65yro needs to fund 20+ years, hard to do without investment growth.

            If you only have $400k without growth it is really looking at the government pension supplementing living. At 7% return $400k is $28k which is not even 75% of minimum wage. I'd think if you own your own home and have no debts living in a capital city would cost at least $45k a year. Even more if you want to take a long haul to Europe or US every year.

            • @netjock: is this a joke?

              Who spends $45k a year on random stuff excluding 5k for bills and food.

              • +2

                @Jugganautx: If you live in a capital city.

                Council rates $2k
                Water rates $1k
                Water usage $0.5k
                Electricity $1.2k
                Gas $0.5k
                Car rego $0.9k
                Car insurance $0.5k
                Home and contents $0.5k if you are lucky
                Petrol $1k
                Internet plus mobile $0.8k

                That is before spending probably $1k a year on home maintenance and unexpected replacement of appliances etc.

                $9k gone. $36k left.

                $3k a month which is $100 per day. I mean going out and getting a breakfast with a coffee is $20. $80 left per day. Unless you never want to be more than a day away from home. The price of accommodation in this country is $60 - $80 per night. On holidays you could be on $200 per day even if you are being thrift.

                $45k isn't all that it is cracked up to be in this country. Unless you sell up and live in Thailand (ex Bangkok).

            • @netjock: 7% return, tell me more

        • 'rode the waves of a commodities boom'

          Username checks out.

        • I have seem people put $1m into Super on the tail end of the mid 2000's boom only to be hit by the GFC and immediately lost 40%.

          The best performing asset class of the decade was born out of the ashes of the GFC. When will it pop, nobody knows? There are plenty of opportunities to make gains while we wait.

          • @whooah1979: Yes that is true.

            For retirees who are drawing from the capital are more exposed to such troughs as they are drawing from the capital during the recovery.

    • Thanks but bitcom isnt for me.

  • +3

    Any pitfalls or suggestions as to the best fund, less fees?

    The best fund is the one that gives you the best return after factoring in all the fees. That is, the lowest fee option is not necessarily the best if it gives low returns compared to other funds.

    You should be asking your financial advisor (if you trust that he knows his stuff). First, you'll need to determine your own risk appetite and what you're comfortable with. Generally, people going into retirement prefer to place their money in a more stable option (less volatility) as they are drawing down on assets on a shorter term and don't necessarily have the option to wait out for "recovery" after a market dive. But if you have other assets, you may well be comfortable with higher volatility. Everyone is a little different so best to factor in your own circumstances rather than relying on someone else's recommendation of "best super fund".

  • +1

    I would recommend Australian Super

    • That was the fund I was thinking of, thanks

      • +1

        I've been with Australian Super (& it’s predecessor STA) for about 30 years. I’ve recently created a pension account with them. They took a hit during the GFC (as did all major funds), but otherwise performance has been very good. I decided a 50/50 split between balanced and growth was best for my circumstances, with a 2% (Covid half size) pension. I still have many years of expected life, and expect the market to have some ups and downs but overall much better growth than ‘capital stable’.

  • Like everything in life this is no certainty about tomorrow, so you need to balance risk vs reward. Personally I'm with Hostplus, and utlise their Choiceplus option which comes at an extra cost. I'm no where near retirement age (early 40's) but spread my risk across Balanced, US & AU Share funds, along with my own selection of shares I've taken a punt on using the Choiceplus function. So far I've been happy with Hostplus in terms of ease of use & also performance.

  • +1

    It's a bit of a flip of the coin right now. America are busy printing money which should theoretically push up inflation. Anyone stuck in cash is losing money as more worthless money gets printed. The problem is that the US market is in a dangerous bubble territory with unprecedented artificial measures taken and US$30 trillion of debt, so is poised to burst. Your big decision right now isn't which particular fund, it's when will the US bubble burst. There's a pretty good chance of a 10-15% correction over the next few years.

    • I changed from a balanced to a lower risk due to the Corvid uncertainty and current US bubble. My cunning plan is to then change back to balanced after the next correction to hopefully ride the recovery up

    • Talking about debt, the us is not gonna burst anytime soon. All countries now literally printing fiat money to spend and as long as you're in the club where everyone believe your printed notes mean something then you'll be fine (just don't do silly things like Maduro or Mugabe did). Japan has even higher debt per head and the young generations literally bear the debt burden of its parents and grandparents but nothing happened yet.

      • Japan is far from a poster child of success. 300% debt to GDP. Only two tax payers for every senior. The large elderly population trading in government bonds for their own support in old age. Population expected to decline by 20% by 2050. The only thing propping up Japan is the ability of the insular populace to invest internally and absorb punishment. Japan's collapse is certain over the next few decades.

        As for the US, $2.5 trillion managed to buy a week of market positivity before fears returned. There is major ADHD and fingers in dikes going on there. Something is brewing.

        • Set aside big wads of fiat for the dip. The weak 🙌 will drop their bags as soon as they get a whiff of blood.

  • -2

    Best Super Fund for Retirees

    You're leaving it a bit late…

  • +1

    Best fund is to manage it yourself…

    • perhaps you shouldn't give advice if you're not well informed

      • -1

        perhaps I'm more well informed that you might think…

        • More than one million members have chosen to self-manage their super in an SMSF. Large
          SMSFs are broadly competitive with institutional funds in terms of net returns. However,
          smaller ones (with less than $1 million in assets) perform significantly worse than
          institutional funds, mainly due to the materially higher average costs they incur due to being

          Maybe do some reading before giving out financial advice :)

          • @ginormousgiraffe:

            before giving out financial advice

            I wasn't giving out financial advice.

    • +2

      I have a friend who is doing SMSF and trying to get back to industry managed. Absolute nightmare that even his accountant can't get sorted. So far he's spent days just on forms and requests and ID checks.

      I wouldn't go down that route ever knowing how hard it is now.

      • Sounds like it's time for a new accountant… One that specialises in it.

        • I agree however if it's self managed surely they should make it simple to switch. Like, you can't even just open a regular super account and have them roll all your money in, which is only a few clicks if you're in a regular fund.

      • Why would anyone want to go from being self-managed to making ~8% p/a (which is terrible returns)?

        • Because he spends too much time on it and it can get stressful. It's borderline gambling.

          • @Mechz: It is not surprising that he is spending time looking after his investment. It should be >10% of his life's accumulated income.

    • I agree. If past preservation age and retired, why have money in super? It’s another level of fees when you could hold the same investments outside of super. Plus the fund pays 15% tax on earnings where, with no other income, the OP would probably pay none. Am I missing something?

      • I’m replying to my own post here because I remembered that, once you take a pension from your super, the fund no longer has to pay tax on the earnings. I still don’t see an advantage to being in super, though. You can invest more flexibly outside super without penalty.

        • 15% tax rate rather than greater than 30% tax rate outside of super

      • +1

        No tax on a super fund in pension mode, no tax on your super pension for recipients over 60. My super earns $100-200K pa tax-free, pays me a pension in an amount of my choosing, also tax-free, and I can earn money elsewhere and still have a tax-free threshold. Then there’s the franking credits …

  • +1

    You can always ask your current to remove insurance and other fluff if you want to maximise your interest.

    If you have a accountant, there is a option to self manage a business property but if your not renting it yourself, then can be lots of hassles.

  • +1

    I suggest that you really need a good financial advisor that charges reasonable fees.

    Ours (Adelaide, sorry) keeps us advised as to what he suggests before doing anything to our account, makes sure to maximise our Centrelink top-up, holds regular meetings with us, etc., all for a fixed and very reasonable annual fee.

    We are both 68, so retired in the last couple of years and followed his advice for 10+ years.

    We would not have what we do without him, so money very well spent, I believe.

    Ask locally, as there must be more like him where you live.

    • Would you be comfortable sharing what those fees are? My parents recently had an initial meeting with a FA following my suggestion to do so. They found it worthwhile but will wait until the sale of a property (so they have funds to manage) until engaging anyone. I didn't see a detailed breakdown but I believe his fees were $5000 upfront and am unsure if there was an ongoing % management fee but I assume there would be.

  • +1

    At 66, we are going through the same with our SMSF which has a growth portfolio with Stockspot using ETFs.
    Our advisor asked us 2 questions 1)As you get older will you be capable to run your own SMSF?
    2) If you were to die, would your wife want to run her own SMSF?
    If not , he recommends Australian Super which has been a consistent performer over the last 10 years.
    You must have a cash buffer in retirement so that you are not forced to sell down your portfolio in the inevitable downturns that will occur in the next 20+ years of your retirement

    • +1

      I'd find someone to help with SMSF. I was just looking at REST - thier fees worked out to be 1% of my daughter's super. That's find in the good years, but in the years that they lose your money, taking a 1% fee for it would hurt.
      SMSF costs less than $1000pa or you're paying too much.

      • Australian and International shares have a 0% investment cost on rest, so it depends on your investments within the fund. This means that the cost will cap out at $300 admin fee for any balance over $250k, and obviously less than that under that amount. If anyone is smart enough to continually outperform the market they likely would not be retiring at 65, so you would just be paying $1k+ pa to invest in the same index funds

        • okay, so you can swap an investment fee for a buy spread - 0.05 - 0.11% - granted better than up to 0.62% for other investments.
          Then the indirect cost ratio up to .21% they skim off returns.

          I gotta admit I didn't realise the admin fee is capped at $378.

          You're right, if you just want to put all your money in an index fund or 2, it's not a bad way to go. (The buy sell spreads on ETFs on the asx are terrible also.)

  • May I ask, what age bracket are you in, at the moment?

    • am a retiring 65 yo

  • +1

    Apologies, I misread you original post as 'retiring at 65' My wife is with Aware Super (formerly called First State Super) We are very happy with their level of service and performance. They are an industry fund that anyone can join.
    There are options to leave your funds in several types of managed portfolios with varying degrees of risk which you can change at any time if you wish. eg. high growth, growth, balanced during retirement etc you can also allocate whatever portion you wish to cash, shares, international shares, property etc. just by selecting what you want to change via their website.
    However you still need to consider getting financial advice prior to mixing and changing and selecting levels of risk.
    They have a phone app also which you can check your portfolio amount anytime you wish.

  • +1

    I recommend HostPlus industry fund. Very reasonable fees. No need for a financial adviser.

  • Consider an Index fund - these are low fee funds with very good returns. I'm in the MLC Masterkey Pension Fundamentals Retirement Index plus growth portfolio fund. There are other more conservative MLC Index fund alternatives. This fund has recovered from the Covid market collapse of 12 months ago. Capital protection is also available for a fee.

    • +1

      The admins fees on MLC funds are ridiculous for high balances

  • +1

    If you are going to go without an adviser you need to learn the basics of super, tax and the interactions with Centrelink and any benefits you already have that might have ‘grandfathered’ exemptions like the Commonwealth Seniors Health card. Drop into a good bookshop like Dymocks and browse the finance section. There are a number of good local authors on the subject - many of them write in the financial pages of the papers also.
    SMSF without any experience is tricky and needs expert attention. Mainstream SMSF providers charge handsomely for this.
    You do not need SMSF if you want to use a fund manager like an industry fund. Make sure you check on the investment fees which are different for each option, and on top of the admin fees. You will notice some funds have very low investment fee options, some don’t. That research requires some digging through fine print.

  • Please don't listen to the internet. I work in super and strongly recommend seeking advice from a financial advisor so they can review everything for you - your personal finances, centrelink, etc etc

    If you're not happy with your current advisor, try to seek someone more suitable

    • How is your advice not advice from the internet?

      • It sounds like a shill for financial advisors.

        • Exactly. There are body parts of one washing up on NSW beaches, yet advice from OzBargain that people with no financial incentives are happy with industry super funds is dangerous internet advice. Maybe there should be a royal commission into unsolicited internet advice. It probably couldn't come out worse than the recent financial services rorting.

          • @DisabledUser171442: People shouldn't trust anyone with their investments unless they're willing to accept the risk of losing the lot.

  • You need to get into crypto
    Open a smsf esuperfund
    Get cba bank accounts
    Sign up with btcmarkets, they have free tax report generator

    So it's easy to submit it to esuperfund

    The above suggestions are the cheapest and easiest for smsf into crypto

    Please do it before they go to 100k usd, this is the week!

  • After that woman scamming investors… are you sure you have those funds?
    Get smart… stop chasing rainbows and invest with a govt supported agency.

    • Government backed super is where people find 🌈.