Top performing super funds for 2020: Is yours on the list?
Despite huge share market falls early in the year, the top super funds ended 2020 up almost 10%.
Super research firm Chant West has released a list of the top performing growth super funds for 2020. Despite the year getting off to an incredibly rocky start with share market falls of more than 30%, some super funds managed to end the year with a positive return of almost 10%.
Suncorp Multi-Manager Growth was the top performing growth fund last year, with an annual return of 9.6% for members. Next up was Australian Ethical Super Balanced with a return of 8.3% for the year. This impressive result highlights that you don't need to sacrifice returns to invest more ethically or more sustainably.
AustralianSuper Balanced came in at spot number six for 2020, however it took out first place for the top performing growth super fund over the past 10 years.
Top 10 performing growth super funds in 2020
| Super fund | Return in 2020 |
|---|---|
| Suncorp Multi-Manager Growth | 9.60% |
| Australian Ethical Super Balanced | 8.30% |
| Vision Super Balanced Growth | 6.20% |
| VicSuper Growth (MySuper) | 6.00% |
| UniSuper Balanced | 5.90% |
| AustralianSuper Balanced | 5.50% |
| Aware Super Growth | 5.50% |
| IOOF MultiMix Balanced Growth | 5.20% |
| Prime Super MySuper | 5.20% |
| Equip Balanced Growth | 5.10% |
Growth funds are those with 61-80% of assets invested in growth investments like shares, and it's where most Australians have their super invested. In comparison to the top 10, the median growth fund ended the year with a return of 3.7%. This is an impressive result given the volatility we saw with Australian and international shares prices.
"If we take ourselves back to late March, the prospect of finishing the year up 3.7% would've been inconceivable. Back then the world was in chaos, facing a frightening health crisis which saw most countries introduce some form of lockdown. Whole industries ground to a halt, countless jobs were lost and the global economy was heading rapidly into recession," said Chant West senior investment research manager Mano Mohankumar.
Did you move your super to cash or make a withdrawal?
During the worst of the share market falls, a lot of people considered moving their super out of shares and into a cash investment option. Mohankumar said that people who panicked and moved their super into a low-risk cash option would have missed out on these gains over the last six months.
"2020 highlighted the long-term nature of super and the importance of patience. Members who sat tight generally did okay. Sadly, there were many others who panicked when markets fell and switched their investments to cash or a more conservative option. Not only would they have crystallised their losses, but they would also have missed out on some or all of the subsequent rebound," he said.
"And, of course, there were those who withdrew their money from super completely. That's understandable to deal with temporary hardship, but they'll now be faced with making up considerable lost ground."
If you did make an early withdrawal from your super it's possible to get it back on track by making regular small contributions when you're able to do so again.
And if you're wondering what you should do with your super this year, these results are a good reminder to keep it invested in a diversified option with a significant allocation towards growth assets while you're still working.
Compare super funds today and see how your current fund stacks up. If yours is underperforming or you're paying too much in fees, consider making the switch.
