While it’s natural to be nervous about your super returns when financial markets are uncertain, it’s important to stick to some key insights to help you keep current market fluctuations in perspective.
Paul Baggetta has five tips to help you keep your super on track:
1. Take comfort from history – the long-term trend is up
Over the last twenty years or so, there have been at least ten major events that have impacted the Australian share market, including the Wall Street Crash in 1987. While each of these events resulted in a period of uncertainty, the market has always recovered.
Importantly, despite short-term market uncertainty in the past, over the long-term the general trend of share markets is upward. Australian shares, for example, continue to perform well, up 106.6%1 in the last ten years.
2. Remember, super is a long-term investment
Superannuation is a long-term investment designed to grow over your working life, so it calls for a long-term and calm approach. If you’re at the start or in the middle of your career, you could have up to 30 years to keep investing in your super and are well placed to ride out the market ups and downs.
3. Don’t react to short-term market movements
Investment markets move in cycles, so it’s difficult to forecast when they’ll rise or fall. Moving your money in and out of the market during a downturn means you could potentially miss out on any positive bounce gained in a strong market recovery.
4. Make sure your investment option suits your risk profile
Your investment choices are organised into risk categories – stable, conservative, moderate, dynamic and aggressive. Taking on more risk could mean higher long-term returns, but more risk also means enduring more ups and downs in the short-term.
Before choosing how you’d like your super to be invested, you and I will work together to consider how much risk you’re prepared to take and your investment timeframe.
5. Get advice from a qualified source
I can help you make decisions around your super, while taking into account your life stage, needs, objectives and attitude to risk. This is a very important step in our client/adviser relationship and, as a taxation accountant and financial adviser for over 30 years, I am well placed to provide you with good advice you can rely on.
 Returns measured by the S&P/ASX 200 Accumulation Index to end November 2008.
February 2, 2017
January 30, 2017
January 27, 2017
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The information provided on this website is for general guidance only and is no substitute for professional advice. It should not be used as a substitute for legal, business, accounting, tax, financial planning or other professional advice.