Worst Super Funds
Don't stick with a poor super fund. Here's a current list of the worst-performing super funds in Australia for 2022 and steps for how to switch to a better fund.
Sticking with a poor-performing super fund can lead you to retire with hundreds of thousands of dollars less. Each year, the Australian Prudential Regulation Authority (APRA) analyses the super funds in the market and names and shames those that have performed the worst.
If you're in one of these funds, you're encouraged to compare super funds and switch to another fund with better returns.
Worst super funds for 2022
Here are the 5 worst-performing super funds in 2022, according to APRA:
- AMG Super - MySuper
- Australian Catholic Superannuation - LifetimeOne
- Energy Industries Superannuation Scheme - Balanced MySuper
- BT Super - MySuper
- Westpac Group Plan - MySuper
Of these 5 funds, Westpac failed the performance test for the first time in 2022 while the remaining 4 funds have failed for 2 years in a row. The 4 funds that have failed 2 years in a row are now closed to new members, and existing members will be transferred to another MySuper product.
Switch to a better super fund today
Why are these super funds the worst?
These funds have been determined the worst-performing funds by industry regulator APRA as part of its annual analysis of super returns. These 5 funds all delivered poor investment returns for members.
As part of APRA's Your Future, Your Super legislation, which aims to improve retirement outcomes for Australians, the regulator will be looking at how super funds are performing each year. It'll publicly name the worst-performing funds annually, so members have an opportunity to switch to a better-performing fund.
The first year APRA released this list was 2021, and the results are listed below.
How did APRA select the worst super funds?
APRA looked at the performance returns on 69 MySuper products for its 2022 analysis. It assessed the funds that had at least 5 years' worth of performance data and excluded the few new funds that haven't yet had enough time to show medium- to long-term returns.
MySuper funds are the default products offered by super funds when you join. They're designed to be a simple, diversified investment option with fees that aren't too high or too complex and to be suitable for the majority of members regardless of age. The reason APRA only looks at MySuper products when putting together its list of worst funds is that these products are where the vast majority of consumers have their super invested.
While the majority of funds APRA looked at (95.6%) met or exceeded their performance objective, 5 funds failed to meet their benchmark performance and under-performed. These 5 funds make up the list of the worst super funds above.
How to tell if you're in a bad super fund
If you're not with one of the 5 funds listed above, it doesn't necessarily mean you're not with a bad super fund. It's still important to compare super funds to make sure you're not getting stung with high fees and poor returns.
There are 2 main ways to tell if it might be time to switch:
Your fund charges high fees: If you're paying annual fees that are 1.5-2% of your account balance, this is considered to be high. For example, if you've got a balance of $30,000 and your annual fees are $600, this is a fee of 2% which is higher than many funds in the market.
Your fund delivers poor performance: Many of the top-performing super funds achieve average returns over 9% p.a. If your fund is delivering returns much lower than this, for example 4% or 5% p.a., this is quite low in comparison. However, the type of fund you're with will impact investment returns. If you're in a more conservative portfolio, you can expect lower returns over the long term.
How do the worst super funds compare to the best funds?
Being in a poor-performing super fund can have a huge impact on your super balance when you retire. It might not seem like a big difference early on, but the more your super grows and benefits from compound growth over your working life, the bigger the difference will be.
Example: Poor-performing fund vs high-performing fund
Let's say you're 25 years old, earning $80,000 a year and have a super balance of $20,000. Assuming your income stays the same until you retire, here's the super balance you'd have at retirement with different performing super funds, according to MoneySmart's calculator.
|Your super fund's performance p.a. until you retire||Your balance at retirement|
As you can see, switching from a super fund that earns 5% p.a. to one that earns 9% p.a. can help you retire with more than double the amount of super. That's a lot of extra money for simply switching from a poor-performing fund.
Remember, past performance doesn't guarantee future performance. When looking at a fund's performance, make sure you look at long-term returns (over 10+ years) instead of the most recent year's return on its own.
What to do if you're in a bad super fund
If you're with one of the worst-performing super funds that APRA names on its list, you'll receive an email or letter from your super fund. The fund is required to tell you it has failed the performance test and encourage you to compare super funds.
According to APRA, a few months after it published its 2021 list of worst super funds, only 7% of members in one of those funds had actually switched their super. APRA said this was concerning, as it meant people would retire with less.
If you're in a bad super fund you should do the following:
- Look at how your fund has performed over the long term (5-10 years) and how this compares with others in the market.
- Consider switching to a better performing super fund (it's easier than you think to change super funds).
- Make sure you properly close your old fund and consolidate any other funds you have into your new fund.
- Give your employer your new fund account details so you can start receiving your super payments into your new fund.
Even if your super fund isn't named as one of APRA's worst-performing funds, it's never a bad time to compare how your fund is doing against others.
Why you can trust Finder's super fund experts
Our comparison tables are completely free to use. We link you directly to the super fund's secure application page. Plus, you can access all of our research in our media room.
We've researched and rated hundreds of super funds as part of our Finder Awards. We've published 50+ guides and our in-house experts regularly appear on Sunrise, 7News and SBS News.
Unlike other comparison sites, we're not owned by a super fund company. That means our opinions are our own and you can compare nearly every super fund in Australia on Finder.
Since 2017, we've helped over 200,000 people find a super fund by comprehensively comparing funds. We'll never ask for your personal information. We're here to help you make a decision.
We're here to help
More guides on Finder
Use our free superannuation calculator to see your projected retirement balance, and how this could change by switching funds.
Spouse super contributions
Spouse super contributions allow you to grow your partner’s super balance and also save money on tax. Here’s how spouse super contributions work.
Superannuation changes 2023
Here are all the changes that are happening to super this year, and how they’ll affect your superannuation balance.
What is superannuation?
Superannuation is the main way of saving for your retirement in Australia. Your superannuation is one big investment portfolio in your name that's managed for you by your super fund.
AustralianSuper vs Australian Retirement Trust (formerly Sunsuper)
Trying to decide between AustralianSuper and Sunsuper? We've compared their fees, investment options, performance and extras side by side to help you choose.
How to change super funds in 4 steps
Here’s what you need to know about changing super funds including how to do it, the fees that apply, how long it takes and the pros and cons of switching.
HESTA superannuation | Performance, features and fees
An industry super fund with all the profits benefitting members, several investment options to choose from and low fees.
Super co-contribution: What is the government co-contribution? (2023)
Find out if you're eligible for the government's co-contribution scheme, potentially receiving up to $500 for making personal after-tax contributions.
When can I access my super?
There are 3 ways you can access your super. The age you need to be to access your super will depend on when you were born.
How to find lost super
If you've held a super fund for a while, you may have lost super that you don't even know about. Read on to find out how to recover your lost super.
Ask an Expert