When it comes to choosing an appropriate investment option, super fund members rely on labels such as high growth, growth, balanced, moderate and conservative. They indicate that option’s key features and its underlying risks.
These five pre-mixed, diversified options are invested in a range of growth and defensive assets. The high-growth option invests 90%-100% of your money in shares and property, while the conservative option allocates 70% to cash and fixed interest and the rest in growth assets.
Remarkably, there are no regulatory rules or standards governing these labels. Instead, super trustees apply a growth/ defensive categorisation to their labels that is commonly agreed upon by the industry.
Xavier O’Halloran, director of Super Consumers Australia, says this categorisation doesn’t always work for consumers and can be unreliable.
“One of the ratings agencies did some work on labelling recently. There was so much category overlap. Those labelled as ‘balanced’ were very high growth compared to some of their peers once you looked at the assets they were actually invested in.”
He says consumers rely heavily on “truth in labelling” when it comes to making important decisions about their super because they don’t have the expertise to check the option’s underlying assets, particularly unlisted assets.
“Although they are disclosed, you won’t know, for example, whether the fund owns all of the asset, or part of it, or its current value.
Bu hikaye Money Magazine Australia dergisinin September 2023 sayısından alınmıştır.
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Bu hikaye Money Magazine Australia dergisinin September 2023 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
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