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Super Funds Deliver Impressive 11.5% Returns For Australians In 2024

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Australian workers’ superannuation savings have yielded gold in the past year, with people seeing a significant increase in dividends, which touched a 3-year-high.

The year 2024 has ranked among the top eight most successful years for superannuation funds since 2000.

The median balance option delivered impressive returns in 2024, and members who invested aggressively in assets like shares saw notable growth in both domestic and international markets, with many options churning out returns of over 10%.

News.com.au reported, citing SuperRatings, that the median balanced option returned an impressive 11.5% for 2024.

Even better, top funds are expected to achieve returns of up to 12.5%, with the spectacular growth being credited to international share exposure, leading to double-digit returns. As a result, Australian workers have seen a boost to their retirement savings.

“Returns were modest leading into Christmas, with leading research house SuperRatings estimating that the median balanced option (60-76% growth assets) generated a return of 0.4 percent over the month. However, positive returns over 11 of the 12 months in the year have added up,” SuperRatings executive director Kirby Rappell said.

The strong long-term returns were delivered despite a median return of 6.7% per annum since 2000. This exceeds the target objective of CPI+3%, with CPI currently at 2.8% annually.

The latest Australian Bureau of Statistics data showed that the country’s Consumer Price Index (CPI) increased 2.8% yearly in the September quarter; figures for the December quarter will be made public in late January. Rappell said that while 2024 was a fantastic year, there will be difficulties in the coming year as markets level down.

“Most of this year’s returns have come from share markets, which are now priced at historical highs both in Australia and internationally,” Rappell said, per Bloomberg.

According to Rappell, members ought to give top priority to the long-term success of Australian superannuation funds, which have continuously produced impressive outcomes over time, even in the face of persistent dangers.

“A correction in share markets would have a strong flow on effect to members’ superannuation balances and members should be prepared to see ups and downs over the short term. … Inflation, particularly in Australia, also continues to be persistent with Australian interest rates likely to come down slowly over time, and cost of living pressures remain elevated,” Rapell said.

“Funds have consistently demonstrated their ability to swiftly recover from downturns and members with many years until retirement can afford to block out short term noise in returns.”

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