Is it better to invest in super or shares?

Whether it is better to invest in super or shares depends on your financial goals, risk tolerance and time horizon. Superannuation offers tax advantages and long-term growth, but you can't access the funds or wealth created until retirement. Meanwhile, direct share investments provide more flexibility and potential for higher short-term returns, but without the tax benefits of contributing to super. Diversifying between both can be a good strategy.

Are shares better than savings?

Shares can offer higher returns than savings accounts, but they come with higher risk. Savings accounts provide a secure, low-risk way to earn interest, but the returns are generally lower compared to shares. Investing in shares can be a good long-term strategy as they can grow significantly over time, but they are subject to market volatility.

What are the disadvantages of investing in superannuation funds?

Disadvantages of investing in superannuation funds include limited access to your money until retirement age, potential changes in government policy affecting super rules, and fees that can eat into your returns over time. Additionally, you have less control over specific investments compared to directly buying shares.

Is it worth putting money into super?

Yes, putting money into super is generally worth it, especially for retirement savings, due to the tax benefits and potential for long-term growth. Employer contributions and government incentives like co-contributions also make super a valuable investment strategy for the future.

Shares vs superannuation: Where should you invest?

Adding money to your super and investing in shares are both good ways to invest and build your wealth, and have generally achieved similar long-term returns.
If your marginal tax rate is above 15%, money you put into super is taxed at a lower rate than your income - but you can't access it until retirement.
When investing in shares you have complete control over your investment choices, and you can sell and get the money whenever you want.

Investing in shares

For the purposes of this article, when we refer to shares, we mean a portfolio or collection of shares - not just a single share investment.

When you purchase shares, you get part ownership (or a share) of a company. When a company performs strongly, the price of its shares rise. You can make a profit by selling the shares at a higher price than what you paid for them (this is called a capital gain). You do need to pay capital gains tax from selling shares, which is applied at your marginal tax rate. However if you've held the shares for more than 12 months you'll get a 50% tax discount when selling.

Many companies will also pay shareholders a dividend, which is basically a share of the company's profits. The amount you receive as a dividend payment will be directly related to how many shares in the company you hold. If you invest in enough shares, you could create a second income stream out of the dividend payments alone.

Pros and cons: Investing in shares over your super

Pros

Individual ownership of the shares.
You can get dividend payments into your bank account as a form of income.
You get capital growth (unless the shares fall in value)
You have complete control over your investment decisions.
You can sell, or buy, at any time.
You can act on investment opportunities quickly.
Capital losses on shares can be used to offset capital gains in your tax return.

Cons

Shares are less diversified than superannuation.
Shares are a higher risk option.
They require a greater level of engagement and more expertise.
You're responsible for all tax obligations.
Capital gains are taxed at your marginal rate, halved if you have held the shares for more than 12 months.
It's more expensive as you need to pay brokerage fees for each trade you make.

Investing in shares may suit you if...

You want to have access to the money before you retire
You want to have complete control over the individual shares you buy and sell, and the timing of your trades
You want to earn a regular income stream in the form of dividends
You're comfortable taking on more investment risk and understand how the stock market works

Our expert says

"Investing in shares directly offers flexibility and the potential for higher returns, but superannuation provides the power of compounding over decades with tax advantages and long-term security. The best strategy often involves balancing both to maximise growth while securing your financial future."

Kylie Purcell

Investments Analyst

Investing in your superannuation

Your super fund is basically one big investment portfolio that's managed on your behalf by professional investors. Your employer is required to pay a portion of your earnings into your designated super fund (this is called the super guarantee). The money in your superannuation is invested into various assets, including shares, with the main aim of growing your balance over time.

As the main purpose of superannuation is to fund your retirement and to be a substitute for the Age Pension, you typically cannot access it until you're retired (in a few exceptional cases you can access your super early).

You can contribute up to $32,500 a year in 2026-27 as a concessional contribution into your super. A concessional contribution means the money will be taxed in your super fund at the lower rate of 15%, instead of your standard income tax rate which could be as high as 45%. From 1 July 2026, an additional Division 296 tax of 15% applies to earnings on the portion of your total super balance over $3 million (a further 10% above $10 million). By doing this, you're also reducing your taxable income meaning you pas less income tax too (learn more about this process, called salary sacrificing).

Pros and cons: Investing in your super over shares

Pros

Your super is managed for you, so it's less work.
It's a more diversified portfolio than shares alone.
There is less risk involved.
You benefit from long-term compound growth.
If your marginal tax rate is above 15%, concessional super contributions are taxed at the lower rate of 15%.
You can reduce your taxable income by salary sacrificing into your super.

Cons

You cannot access the funds until you're retired.
If you're in a pre-mixed fund (e.g. a Balanced or High Growth fund), you can't pick individual shares to invest in.
There's a limit of how much you can invest into super each year.
You can't jump on investment opportunities quickly.

Investing in your super may suit you if...

You want to set up a salary sacrifice arrangement and reduce your taxable income.
You want to build long-term capital growth and don't plan on using the money in the short term.
You don't need to have control over the specific investment decisions, and want more of an automatic, set-and-forget strategy for building wealth.

Long-term performance of shares and super

Both shares and super have, in general, achieved similar returns over the long term.

The S&P 500 (the world's most famous stock market index) has averaged an annual return of 10.68% over the last 30 years¹, making it one of the best performing indices in the world. Accounting for inflation, this means an annual average return of 7.78% (including dividends).

Some of the top-performing High Growth super funds have returned between 10-12% p.a. over the last 10 years, which the top-performing Balanced funds have returned around 7-9% p.a. Read about best-performing super funds here.

Many people like to invest to make a difference; it can be more time-consuming to put together a basket of stocks that focus on responsible investing. However, there are a number of ethical super funds which you can read about here.

Our expert says

"It's worth remembering that super funds already do invest heavily in shares, so you are getting that exposure even if you don't invest in shares yourself outside of super. There is also the option of investing in a more concentrated shares-only investment option for your super, if you want to invest completely in shares. Most funds these days offer a 100% shares option to members."

Alison Banney

Editorial Manager, Money

Could you be getting better returns from your super?

9 of 565 results

Finder Score	Last 1 year performance (p.a.)	Last 3 year performance (p.a.)	Last 5 year performance (p.a.)	Last 10 year performance (p.a.)	Fees on $50k balance (p.a.)
9.2 Excellent Aware Super High Growth Indexed NewIndustry fundIndexed investmentHigher risk	9.2 Excellent	Last 1 year performance (p.a.) +6.95%	Last 3 year performance (p.a.) +13.99%	Last 5 year performance (p.a.) N/A	Last 10 year performance (p.a.) N/A	Fees on $50k balance (p.a.) $172	Go to site View details Compare product selectionCompare	loading
9.6 Excellent AMP Super Specialist International Shares Finder AwardHigher risk	9.6 Excellent	Last 1 year performance (p.a.) +9.31%	Last 3 year performance (p.a.) +16.95%	Last 5 year performance (p.a.) +11.77%	Last 10 year performance (p.a.) +12.92%	Fees on $50k balance (p.a.) $611	Go to site View details Compare product selectionCompare	loading
9.7 Excellent MLC MasterKey Super Fundamentals - MLC Low Cost Growth Higher risk	9.7 Excellent	Last 1 year performance (p.a.) +7.94%	Last 3 year performance (p.a.) +13.34%	Last 5 year performance (p.a.) +8.23%	Last 10 year performance (p.a.) +8.84%	Fees on $50k balance (p.a.) $328	Go to site View details Compare product selectionCompare	loading
9.9 Excellent Aware Super International Shares Finder AwardIndustry fundHigher risk	9.9 Excellent	Last 1 year performance (p.a.) +9.29%	Last 3 year performance (p.a.) +17.66%	Last 5 year performance (p.a.) +11.99%	Last 10 year performance (p.a.) +13.14%	Fees on $50k balance (p.a.) $167	Go to site View details Compare product selectionCompare	loading
9.9 Excellent Hostplus - International Shares - Indexed Industry fundHigher risk	9.9 Excellent	Last 1 year performance (p.a.) +9.75%	Last 3 year performance (p.a.) +17.06%	Last 5 year performance (p.a.) +11.89%	Last 10 year performance (p.a.) N/A	Fees on $50k balance (p.a.) $144	Go to site View details Compare product selectionCompare	loading
9.8 Excellent Vanguard Super SaveSmart - International Shares (Hedged) NewHigher risk	9.8 Excellent	Last 1 year performance (p.a.) +14.9%	Last 3 year performance (p.a.) +18.64%	Last 5 year performance (p.a.) N/A	Last 10 year performance (p.a.) N/A	Fees on $50k balance (p.a.) $280	Go to site View details Compare product selectionCompare	loading
9.8 Excellent Vanguard MySuper - Lifecycle Age 48 NewLifestageHigher risk	9.8 Excellent	Last 1 year performance (p.a.) +7.34%	Last 3 year performance (p.a.) +13.29%	Last 5 year performance (p.a.) N/A	Last 10 year performance (p.a.) N/A	Fees on $50k balance (p.a.) $280	Go to site View details Compare product selectionCompare	loading
9.7 Excellent Virgin Money LifeStage Tracker Born 2014-2018 LifestageHigher risk	9.7 Excellent	Last 1 year performance (p.a.) +7.3%	Last 3 year performance (p.a.) +13.33%	Last 5 year performance (p.a.) +8.47%	Last 10 year performance (p.a.) N/A	Fees on $50k balance (p.a.) $358	Go to site View details Compare product selectionCompare	loading
9.7 Excellent Virgin Money LifeStage Tracker Born 1974-1978 LifestageHigher risk	9.7 Excellent	Last 1 year performance (p.a.) +7.31%	Last 3 year performance (p.a.) +13.35%	Last 5 year performance (p.a.) +8.43%	Last 10 year performance (p.a.) N/A	Fees on $50k balance (p.a.) $358	Go to site View details Compare product selectionCompare	loading

Showing 9 of 565 results

The information in this table is based on data provided by SuperRatings Pty Limited ABN 95 100 192 283, a Corporate Authorised Representative (CAR No.1309956) of Lonsec Research Pty Ltd ABN 11 151 658 561, Australian Financial Services Licence No. 421445. In limited instances, where data is not available from SuperRatings for a product, the data is provided directly by the superannuation fund.

*Past performance data and fee data is for the period ending September 2026

Finder Score for super funds

Finder Score makes comparing superannuation products easier by scoring products out of 10 after assessing their performance, fees and features.

We assess products from over 40 providers based on their risk profile.

Read the full methodology

Shares versus super: What to consider when choosing

Economic conditions and your investment timeframe

Shares and super are both dependent on wider economic conditions. Both are investments so the performance returns can change depending on the economy. That's why when you have shares and/or super, it's best to regularly check the performance of the company and the super fund so you know your money isn't losing value.

Super is a long-term investment that's very diversified, so short-term declines and dips in the economy won't affect it too much unless the economy continues to decline. The long-term nature of super means it is well placed to ride out any waves and dips in the market.

However for some shares, if it's a short to medium-term investment, the direct impact of market conditions can seriously affect the value of your shares. This is especially true in a volatile market or during times of economic or political uncertainty. However, if you plan to hold your shares for the long term (for example 7-10 years or more), your investment will be better placed to overcome small dips in the market.

Diversification

Diversification is an important strategy for an investor to minimise risk. Superannuation is typically more diversified since it invests in a whole range of assets from cash and shares to property and government bonds.

However, you can still achieve a relatively diversified portfolio when investing in shares by making sure your investments are in different industries. For example, having a mix of Australian shares, international shares, shares in technology companies, shares in blue chip companies and even shares in companies that invest in shares (these are called Listed Investment Companies) and so on. That way, if the entire technology industry suffers, you don't have all your shares in that sector alone. However, this is still going to be a very high-risk investment portfolio as it's concentrated on shares.

Your risk tolerance

Typically, the more risk you're willing to take, the greater reward you get if all goes well. If you invest in shares, there is quite a lot of risk involved, especially if you are new to the stock exchange (if you are, you might enjoy our guide on how to buy shares online). Unless you have a financial adviser helping you through the process, you'll have to manage most of your shares yourself, which can be tricky when you're first starting out.

With super, your money is managed by the fund and it decides how to invest your money. There can be less risk involved with super since it's managed by a fund, but you still have the option of choosing a more risky option if you want it. That being said, you do have much less control with your super compared to buying shares directly.

However, while shares may be more risky, there's also the potential to earn more money in the form of dividends or capital growth in the short term, which could be appealing. It depends what your strategy is, and what you want to achieve from your investment.

Your investing expertise

Your level of investment expertise may affect your decision as to where to invest your extra money. Superannuation is managed for you on your behalf, so if you have no investment experience and aren't interested in learning, it could be best to contribute to your super instead of buying shares.

However, if you do have some investment experience or have done some research, shares could be a great option. Just be prepared to stay engaged. This means monitoring the share price, keeping up-to-date with the company and staying on top of broader market and economic conditions.

Your age matters

Age is a big factor when determining if you should go for shares or put your money into your super. Anyone who owns shares will receive their returns without restriction. You may receive dividends or sell your shares for a higher price whenever you choose. Theoretically, shares are a long-term investment if you want to make a decent return, so investing in shares when you're about to retire may not be a good idea.

On the super side of things, you have to wait until you retire before you start accessing your benefits. So if you're young and want to access your returns immediately or sooner rather than later, investing in shares may be a better idea. However, if you prefer to save for a more comfortable retirement, putting your money into super will be a better way to guarantee safer returns.

Expert insight

"Other than the accessibility of shares vs superannuation, the other key differentiator is how they are treated from a tax perspective. Anything in superannuation is taxed at 15%, while any capital gains outside super - like shares - are taxed at your marginal rate, halved if you've held the shares for more than 12 months. If your marginal rate is 30%, and super contributions are taxed at 15%, you are 15 percentage points ahead."

Pascale Helyar

Superannuation and wealth expert

Why not have both?

If you've made it this far in the guide and still haven't made up your mind, remember, there's nothing stopping you from doing both. You can invest some money in shares and also into your super, and use both these strategies side-by-side to build your wealth.

Frequently Asked Questions

Whether it is better to invest in super or shares depends on your financial goals, risk tolerance and time horizon. Superannuation offers tax advantages and long-term growth, but you can't access the funds or wealth created until retirement. Meanwhile, direct share investments provide more flexibility and potential for higher short-term returns, but without the tax benefits of contributing to super. Diversifying between both can be a good strategy.
Shares can offer higher returns than savings accounts, but they come with higher risk. Savings accounts provide a secure, low-risk way to earn interest, but the returns are generally lower compared to shares. Investing in shares can be a good long-term strategy as they can grow significantly over time, but they are subject to market volatility.

Finder writers are subject matter experts and use primary sources, in-depth research and interviews with other experts to ensure you're getting accurate, up-to-date information. Articles are fact checked in line with our editorial guidelines.
1. Finder Compare super funds for a super retirement
2. Finder What is superannuation?
3. Finder Early release of super
4. Finder Best super funds Australia- 5 expert picks
5. Finder Salary sacrifice into your super
6. SuperRatings Pty Limited ABN 95 100 192 283
7. Finder How to diversify your portfolio
8. Finder, How to buy Shares in Australia

Thank you for your feedback!

Written by

Alison Banney

Editorial Manager, Money

Add to Preferred Sources

Alison is an editor at Finder and a personal finance journalist with over 10 years of experience, having contributed to major financial institutions and publications such as Westpac, Money Magazine, and Yahoo Finance. She is frequently quoted in media outlets like SmartCompany and SBS, offering expert insights on superannuation and money management. Alison holds a Bachelor of Communications in Public Relations and Journalism from the University of Newcastle, and has earned three ASIC RG146 certifications in superannuation, securities and managed investments and general financial advice, ensuring her expertise is fully aligned with ASIC standards. See full bio

Alison's expertise

Alison has written 592 Finder guides across topics including:

Superannuation
Savings accounts, bank accounts and term deposits
Budgeting and money-saving hacks
Managing the cost of living

More resources on Finder

Ask a question

Click here to cancel reply.

Display name

Your email (will not be published)

Your question

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms Of Service and Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

8 Responses

WendyAugust 5, 2025

I am 63 still working part time as a registered nurse . Plan to retire next two or three years
I have some cash in my saving account
Should I invest in shares or invest to my shares ？
thank you

Finder

SarahAugust 5, 2025Finder

Hi Wendy,
We’re not licenced to give personal advice, but we can share some general info that hopefully helps. Investing in shares can be a good option if you don’t need the money for at least 5–7 years, as shares typically offer better long-term returns than savings accounts. But, it can be risky, and since you’re planning to retire in 2–3 years, it’s important to be mindful of market volatility. A sensible approach might be to keep several years worth of living expenses in savings, and invest only a portion of your extra savings in low-risk, diversified options like ETFs. Speaking to a financial adviser is a smart move to make sure you make a decision that aligns with your retirement goals. You may have access to a free financial advisor within your super fund. Hope this helps!

EdwardFebruary 23, 2019

I have only 25,000 in my super. I need to try and grow my super. It’s with ANZ Bank and it’s not making anything. Do you think putting some money in shares make my money grow? I’m 59 years old and need to make this money grow can you help me?

Finder

JoshuaFebruary 25, 2019Finder

Hi Edward,

Thanks for getting in touch with Finder. I hope all is well with you. :)

Whether to transfer your money from your bank account to shares or not would depend on your needs, preference, and budget. However, at this point in time, it would be a good idea to consider the pros and cons of each of your options.

For example, when you invest in shares, bear in mind that it takes years for your money to grow. Not only that, but you also need to remember that like any investment, your money in shares can increase but it can also decrease.

Please make sure that you consider the risk of buying shares. If it is a risk that you can afford to take, then, by all means, you might want to get into share trading.

If you want, you can also speak to share trading experts. They should be able to give you more pieces of advice to help you make a better decision.

I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.

Have a wonderful day!

Cheers,
Joshua

KevNovember 21, 2017

Dear Sir/Madam,my wife and l a.own our own home b.my wife has an investment property(positively geared..value $400k..mortgage $220k.) c.we are selling a property and should have circa $150,000 net d.our combined super is circa $1 mill. My wife(58) is undertaking transition to retirement(a teacher with defined benefit super)I,m 59 self employed…and love my work!…..q. a.should we invest the $150k into our separate super fund($75k each) or purchase a house(we live close in Toowoomba and could purchase a rental property for under $400k..q.b.with all the doom and gloom scenarios re. world economy do you believe we shall be able to have a good quality of life in retirement..? We are conservative folk from humble origins with simple tastes but do like to travel os….your counsel is valued, cheers

Finder

MayDecember 12, 2017Finder

Hi Kev,

Thanks for your inquiry and sorry for the delay. Just to confirm that you’ve reached finder, a leading comparison website, and general information service. We’d be glad to offer you general advice to answer your questions.

As we are not financial experts, we may not be able to advice as to how and when is the best time you can invest your super. It would be best that you speak to a financial planner who can help you achieve your financial goals and understand your needs. We have a guide about seeking financial advice which you may find useful.

Cheers,
May

rof78@gmxNovember 7, 2016

i am 62 thinking to retire .my husband 8=69. have b2 investment properties worth $1700.000 with a loan of $1000.000.want to sell one property ,but scare about c g t.How can avoid that capital gains tax

Finder

ClarizzaNovember 8, 2016Finder

Hi there,

Thanks for your comment. We are a comparison website and as such, can provide general advice only. If you have any concerns or would like to discuss your personal situation in more detail, we recommend speaking to a financial planner.

Regards,
Clarizza

More guides on Finder

How much super should I have?
The average super balance is $154,350. Compare your super balance against the average balance for your age group to see if yours is on track.
Worst performing super funds in Australia
Here’s a current list of the worst-performing super funds in Australia and steps for how to switch to a better fund.
Australian Retirement Trust vs HESTA
We've compared the fees, investment options and performance for both Australian Retirement Trust and HESTA to help you choose between these two popular super funds.
AustralianSuper vs Rest Super
AustralianSuper and Rest are two popular industry super funds, but how do they compare on fees, performance and investment options?
AustralianSuper vs Hostplus
Can't decide between AustralianSuper or Hostplus? We've compared their fees, performance and investment options side-by-side to help you choose.
Best super funds in Australia 2026
We've analysed Australian super funds to find the best-performing super funds, the best industry super funds and the best super fund for low fees. Find the right super fund for you.
Best Industry Super Funds
Find out what industry super funds are and how they’re different to retail super funds, and compare funds using our comparison tool.
Superannuation beneficiary rules
Steps to choose a beneficiary for your superannuation fund proceeds in the event of your death.
Media Super: Investments, performance and fees
Media Super is an industry fund for employees in Australia’s print, media, creative or digital sectors. See investment options, fees and performance here.
CareSuper: Performance, features and fees
CareSuper is an industry super fund. Learn about MySuper and retirement pension products from CareSuper.

Shares versus superannuation: Where should you invest?

Investing through super comes with tax benefits, while investing through your own share trading account will allow you to access the funds whenever you like.