Super returns fall in FY22

The median balanced option for the financial year ending June 2022 has recorded a -3.3% fall, the fifth time financial year returns have been negative since the inception of superannuation in 1992.

Contextualising the end of financial year results, SuperRatings noted that despite market volatility due to ongoing supply challenges and the war in Ukraine, $1 of super invested in 1992 in the median balanced option would be estimated to be worth $7.67 today.

Executive director of SuperRatings, Kirby Rappell, said: “This was the fifth negative return for balanced options we have seen since the introduction of super 30 years ago. However, it follows the second highest annual return of 17.8% in 2021. So, when you look at it over the last two years, members’ balances are up.

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“Super is a long-term investment and funds continue to provide strong long-term returns on average and have outperformed the typical CPI+3.0% investment objective. When you consider that share markets are down around 10-12% across Australia and globally, super funds have done well to prevent some of the steep falls that we have seen from being passed through to members’ super account balances.”

Meanwhile, the median balanced option declined by an estimated -3.4% over June, while the median growth option reduced by an estimated -4.4%. The capital stable options, which hold more traditionally defensive assets such as cash and bonds, fell by an estimated -1.7%.

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