Choosing the right investment option for you

Like most important decisions in life, there’s no one-size-fits-all when it comes to choosing how to invest your super.

While most members have their super invested in our Balanced investment option (a diversified option that’s delivered strong long-term returns), you can choose to invest in one or a combination of our 13 different investment options. If you’re worried about your balance fluctuating due to share market volatility, it’s important to realise you haven’t lost anything unless you switch your investment option (which is called ‘crystalising a loss’). When choosing the right investment option(s) for you, it’s important to weigh up your attitude towards risk against potential long-term growth. We know nobody likes to see their account balance go backwards and it’s tempting to change your investments when conditions are uncertain. But there are a few things to consider.Here are some tips and examples to help you find the right investment choice to suit your future goals.

Here are some tips and examples to help you find the right fit to suit your needs.

1. Work out your timeframe

How long until you start spending your super? Your investment timeframe can be a big factor when it comes to choosing an investment option that’s right for you. As a very general rule, the longer your super is going to be invested, the more risk you may be able to take. On the other hand, if you’re planning to withdraw super soon, you might consider a lower risk approach.

2. Decide how much risk you’re comfortable with

Once you’ve worked out your timeframe, consider how much risk you’re prepared to take on. In general, higher risk options tend to have higher return targets over long-term periods, but they’re more likely to be volatile over the short term. It’s important to choose a balance between risk and return that sits right with your timeframe and future goals.

3. Determine your future spending goals

Think about how much you’ll spend each year when you finish work. (Keep in mind, with inflation, things might cost more than they do now.) If super’s going to be your main source of income, how much will it need to grow from contributions and investment returns? Each of our investment options have different return targets, so it’s worth having a goal in mind when you’re looking at your choices. 

Now, let’s look at some examples

These are general examples. You need to consider your own circumstances, keeping in mind that these examples haven’t considered the impact of significant volatility in investment markets. As you can see, there’s plenty of choice when it comes to investing your super, and the perfect fit is different for everyone.

Meet Peter.

Meet Peter.

He’s a 32-year-old IT specialist with $22,000 in his CareSuper account.

Peter has always been invested in the Balanced option, which is the ‘default’ option for CareSuper members. Recently, Peter reviewed his super investments and realised he probably had at least another 30 years to ride the ups and downs of a higher risk investment option. Deciding his goal was to achieve the highest returns possible for his super, and he was comfortable with market fluctuations, Peter switched from the Balanced option to the Growth option.

Meet Lee.

Meet Lee.

She’s a 45-year-old teacher with $63,000 in her CareSuper account.

Lee’s always been invested in the Balanced option, but following a recent market downturn, she decided to examine her super investments. Lee’s goal was to achieve relatively strong returns over the next 15 to 20 years, but she wanted her super to be invested across several different types of assets to protect her balance as much as possible. After reviewing its return target, asset allocations and risk level, Lee decided to stick with the Balanced option.

Meet Jack.

Meet Jack.

He’s 56, a lawyer and has $600,000 in his CareSuper account.

Jack is planning to retire soon, but instead of withdrawing his super as a lump sum, he wants to reinvest it in a CareSuper Pension that will continue to earn returns over the next 25 years or more. Jack decides to invest his super in the Conservative Balanced option, since he believes this option performs well enough to help his balance grow over the long term.

Meet Priya.

Meet Priya.

She’s 60 and is a HR Consultant, with $120,000 in her CareSuper account.

Priya’s planning on selling her business and downsizing to an apartment by the beach next year, and to pay for the deposit, she wants to withdraw her super as a lump sum. Not wanting to take too much short-term risk with her savings, she decides to switch from the Balanced option to the Cash option. Investing in a low-risk option gives Priya peace of mind, even if there’s a market downturn.

Speak to a financial planner to help you find your perfect fit

As you can see, there’s plenty of choice when it comes to investing your super, and the perfect fit is different for everyone. It’s important to get financial advice before you switch. That’s why we offer expert advice over the phone as part of your CareSuper membership.* Book a call back from one of our financial planners.

Find out more about your investment options as a CareSuper member.

* 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.


Information correct as at 8 September 2023.