5 Best Super Funds in Australia | 2014 Top Superannuation Reviews, Ranking and Comparison

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Australia probably has the coolest name for retirement funds in the world: super funds (short for superannuation funds).

MarketConsensus is releasing its 2014 detailed review and analysis on the five best super funds in Australia. With this article, we aim to provide a detailed overview of Australian super funds, including a ranking and comparison of five of the top performing super funds for 2013 – 2014, taking into special account returns over five and ten year timeframes after fees and commissions have been deducted.

This report is a follow up to other top reviews (2014’s Best US Bonds Funds and the Top 12 Online Banks in 2014) that we’ve recently published.

Best Superannuation (Super) Funds Detailed Overview

  • List of Top 5 Super Funds
  • Key Selection Factors
  • Gold Mine for Fund Managers
  • Tax Benefit of Superannuation
  • Super Funds Fees and Commissions
  • Risk: How does the Risk Band Rating Work and What does it Mean?
  • Comparison Ranking of the Best Australian Superannuation Funds
  • Top 5 Superannuation Funds – Overview of Each Super Fund

List of the Top 5 Super Funds

  1. REST Super Core Strategy
  2. CareSuper
  3. AustralianSuper
  4. QSuper Balanced Option
  5. AustSafe Super – Balanced

See below for a detailed overview of each of the above funds.

Key Selection Factors for the Top 5 Superannuation Funds

Experienced Australian investors and traders normally consider the below five factors to determine which super fund best meets their needs.

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In our research and analysis, we have placed a big emphasis on balanced super funds, since more than 80% of Australians invest in these. We also focused on high return and long term performance, as superannuation funds are long term investments.


Key Factor




Past returns do not guarantee future returns, but choosing a fund with good recent returns can lead to a healthier balance – if they can keep the ball rolling.


Risk and Asset Allocation

The specific sectors and industries that a fund is invested in is an important consideration when assessing risk.

Although funds are given a 'risk band rating' based on what assets they invest in, you should still take some time to review the asset allocation for yourself.

As an example, if you believe that real estate properties are going to decline in value, then you might choose a fund with a smaller allocation in this area.

If you want a fund that doesn't fluctuate in value very much, then you might choose one that invests heavily in fixed interest securities or bonds.


Fees and Commissions

Funds with lower fees are a big priority for many investors. Lower fees can lead to a much healthier balance when it comes time to retire.


Performance Duration

It is important to consider the performance of your fund over the long term. If your fund has been a top competitor over the last five or ten years then it is probably being responsibly managed – as opposed to getting lucky.


Size of fund

Some people are more comfortable going with larger funds. This is because, on average, large funds have much more money under management and more people to keep happy; as such they can be less prone to making risky bets.

Some super funds come with clear tax benefits for the savvy investor, and there are others that consistently outperform. However, investors need to show caution when investing.

Gold Mine for Fund Managers

The Australian Superannuation Market is a gold mine for fund managers, who have pretty much free reign on what they charge you for commissions.

This has been the case because many investors either have no idea this is happening or simply don't care.

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Your employer socks away a percentage of your wage for retirement funds, as requested. Most of us don't see it and we rarely think about it, until it is time to retire.

Tax Benefit of Superannuation

The money that your employer contributes into your super fund is taxed at only 15%, so you are saving money straight away by paying a lower tax rate on your earnings.

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In addition, any extra income earned within your superannuation fund, (such as derivatives on shares within the super fund), is taxed at only 15%. “Capital gains” is charged at a flat 10%. 15c out of every dollar beats the 32.5c to 45c you will pay on the earnings that go into your pocket (depending on your level of income).

That extra tax saving will add to your compounding investment over time, and goes a long way to beating inflation, even if you have a crappy fund manager who can only match the market.

Super Funds Fees and Commissions

There are basically five major fees that super funds normally charge on your superannuation. Note that the returns we present in this article are calculated after deducting fees and commissions.

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However, you can get a quick run-down of what your fund charges by looking at the product disclosure statement (PDS). Here's a table of explanations to help you decode the jargon:


Type of Fee

What is it?


Administration Fee

A fee charged for managing your super account: sending out correspondence, statements, etc. You will usually be charged a percentage of your balance, with the percentage decreasing as your balance increases.


Contribution Fee

This fee is normally paid to your adviser for their recommendations when you make a contribution to your super account. It can vary from 0-5% and is usually negotiable.


Performance Fee

Fund managers will sometimes pay themselves a bonus (out of your money), if they are able to outperform the market. If they underperform the market, however, they will not pay you.


Management Expense Ratio (MER)

This is usually the big one. The MER is the fee charged by the fund manager for managing your investment. It is normally charged as a percentage of your super balance.


Membership Fee

Some funds will charge you a member fee, which is usually a weekly fee that varies from $1 to $5.

Other fees that can apply are establishment fees, termination fees and transaction fees. These are one-time fees charged for special requests.

Risk: How does the Risk Band Rating Work and What does it Mean?

The risk band is a rating given to a fund based on an estimate (probability) of how many negative returns the super fund will experience over a twenty year period… (Read more)

Comparison Ranking of the Best Australian Superannuation Funds

We included in our analysis only high performing super funds that are publicly accessible to all Australians.

If you have special access to an additional fund (e.g., through your employer), make sure to ask for the details and compare it against the following metrics.

Ranking Metrics

Fund Name

REST – Core Strategy

Care Super – Balanced

AustralianSuper – Balanced

QSuper Balanced

AustSafe Super – Balanced

5 Year Average Return % p.a *






10 Year Return % p.a *






Risk Band Rating**

5 – Medium to High

5 – Medium to High

5 – Medium to High

4 – Medium

6 – High

Size of Fund ($Billion)












* Returns are calculated after deduction of fees and commissions, accurate to September 30, 2013.

** Risk rating is for an investment period of 5 – 20 years. If you are really young and investing for longer than 20 years, then the risk level decreases, according to the rating method.

Top 5 Superannuation Funds – Overview of Each Super Fund

(1) REST – Core Strategy

The Retail Employees Superannuation Trust, (REST), is an industry super fund marketed towards workers in retail occupations. On the numbers, this fund is the best performing balanced super fund in Australia in the last ten years.

As Australia's third largest superannuation fund with more than $25b under management, REST has a standard target return of CPI + 3% , (over rolling ten year periods), and has consistently beaten this.

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With an asset allocation favouring shares, (30% international and 20% Australian), this fund is vulnerable to market swings. Assuming you are investing for the long term, however, and considering how this super fund performed and recovered through the global financial crisis, the REST core strategy fund is a very strong contender for you to consider.

(2) Care Super – Balanced

CareSuper is an industry super fund that specialises in superannuation for people involved in professional, administrative, managerial, and service careers. It is open to all Australians. Their investment return target is inflation plus 3% over rolling ten year periods.

The asset allocation focuses on equities with 28% allocation to international shares and 22% allocation to Aussie shares. With $5.5b under management, high performing returns and a strong reputation for customer service, it is a great 'set and forget' option that is already used by over 261,000 Australians.

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Oh, and it was also a top 10 finalist for SuperRatings Top Super Fund (accumulation phase) for 2013 and the winner of SuperRatings 2011 Top Super Fund of the Year.

(3) AustralianSuper – Balanced

This is Australia's largest industry super fund, (by a long way), with $44.868 billion under management. It is also the winner of SuperRatings 2013 Top Super Fund of the Year – which is awarded to the fund that has “provided the best value for money to its members during the accumulation phase”.

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It is the heaviest equities investor of the funds discussed in this article, with 29% in Aussie shares and 31% in international shares. It aims to beat CPI by 4% over the medium to long term. If you love shares, like the security of a huge fund and like that they have a higher target than other funds, then this one is worth considering.

(4) QSuper – QSuper Balanced Option

It is nearly $20b behind AustralianSuper, but with $25.533b under management this is Australia's second largest superannuation fund. The 'Q' stands for Queensland, which is where this super fund started, but it is now open to all Australians. This fund targets returns of CPI + 3.5% after fees and tax, measured over rolling ten year periods. It stands apart with a risk rating in band 4, (medium).

Unlike the other top performing superannuation funds mentioned in this article the asset allocation backs away from shares a little. QSuper Balanced has 13.5% in Aussie shares, 18.7% in international shares with the major holding being in fixed interest at 24.8%.

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So if you are worried about the stock market in particular, this could be a great option for you to consider. It has good targets, lower risk and competitive returns… There is a reason why this super fund broke out of Queensland and is now so popular with Australians country-wide.

(5) AustSafe – Balanced

This is the industry super fund that caters to rural and regional Australia, but any Australian can join. It currently has $1.5b under management and more than 130,000 members.

Like the previously mentioned high performing superannuation funds this one also aims to beat inflation by 3% over rolling ten year periods. However, with the slightly different asset allocation the risk falls into band 6, (high), with 4.1 negative returns predicted in a 20 year time frame.

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The asset allocation is highly biased towards equities, more so than the other funds mentioned in this article, with 30% in Australian shares and 27% in international shares.

If you live in a regional area and work in a rural occupation, you will have the benefit of a fund manager who is from the area and understands the type of assets you are used to doing business with.

It's a good option with good returns, but it is perhaps only a clear winner if you would like the personalised rural service.