Staying down to earth with your super31 Aug 2017
The last year has seen a plethora of ‘good’ and future-focused (tech) super funds spring up, touting transparency and vowing to put your super to ‘good use’ or ‘invest in the future’.
But before you get caught up with all the slick marketing and promises, it’s important to take a step back and look what’s underneath. Considering how fees add up and what the investment objectives are against performance could make a big difference to how much is actually in your account when you finally retire.
Investing in the past, present and future
If you want a high dose of tech to invest in, our High Growth investment option gives you exposure to household brands such as Alphabet (Google), Apple and Facebook. Additionally, our High Growth option is diversified across lesser-known but well-established tech brands which have a proven track record to get the best returns for our members.
In looking to the future, we realise the world is facing challenges of evolving communities and demographic change. Paddocks continue to turn into towns, creating an urgent need for new roads, shopping centres and public transport.
This provides an opportunity to diversify your super investment through property and infrastructure. These might not sound as exciting as virtual reality or driverless cars, but property and infrastructure help our communities grow, produce stable income and, historically, have provided great returns for your super account.
Socially responsible investing
Environmental, social and corporate governance (ESG) considerations are important in making investment decisions. Companies that ignore these considerations risk business losses, financial penalties; even total failure if a company’s ‘social licence’ is withdrawn.
At Media Super we, and our investment managers, are alert to these risks.
We work with other industry funds through the Australian Council of Superannuation Investors (ACSI) to research, monitor and manage environmental, social and corporate governance investment risk. Media Super and ACSI believe in actively engaging with companies to improve their practices (thus mitigating the risks).
Media Super is also a signatory to the Principles for Responsible Investment (PRI) and work through the PRI to monitor and manage ESG risk in international investment markets.
Some members want their super to be invested specifically in socially responsible companies. Media Super’s Sustainable Future Shares option provides that opportunity. It is a highgrowth oriented investment strategy focused on investing in socially responsible Australian companies.
Members can also choose the companies that their super is invested in through our Direct Investment option. In this option, members can invest their super in any ASX300 company or a range of Exchange Traded Funds (ETFs) and term deposits of their choice.
Keeping our fees grounded
Media Super has some of the lowest fees in the industry. For an account balance of $50,000 invested in our Balanced (MySuper) option our fees add up to only $430 a year1, compared with the median across all funds of $513 a year.2
Some new super funds’ fees are upwards of $900 a year for a $50,000 account. This is concerning when you consider even a one per cent difference in fees could add up to a 20 per cent difference in your balance in 30 years.3
When comparing funds, look closely at the total fees, including annual member, administration and investment management fees (depending which option you invest in).
‘You get what you pay for’ might be true for household appliances or cars, but it doesn’t always apply to super funds – higher fees may not equal better investment performance or retirement outcomes for you.
Great returns for you, not shareholders
Media Super is run only to benefit members. All profits go back to our members – strengthening your investment returns, which often outperform funds that are run to generate profits for their shareholders.
For 2016–17, our Balanced (MySuper) investment option returned 11.53%4 for our members, a great return placing us in the top 15 Australian super funds for the financial year. See p.2 for details.
We’ve been looking after our members’ super for more than 30 years, and will continue helping you work towards your retirement goals. And we’ll keep evolving – building on the past and present, and investing in the future – while maintaining a well-diversified investment strategy. We’ll keep your best interests at heart, so you can fly into retirement.
1 Media Super Member Guide Product Disclosure Statement
2 SuperRatings, 2016
4 SuperRatings Fund Crediting Rate Survey – SR50 Balanced options (60–76) Index, June 2017