Super’s ‘boring’ options outperform with 9.1pc gain
AFR – 2 January 2026
Investors who chose the balanced option in super – still the majority despite the introduction of life-stage funds in the past 10 years – achieved average growth of 9.1 per cent in year just ended, according to preliminary data from SuperRatings director Kirby Rappell.
“Balanced fund investors are the long-term quiet achievers. They have less ups and downs than life cycle funds and they have been plugging away at that CPI plus 4 to 4.5 per cent now, pretty much since 1992, which is a pretty awesome outcome,” Rappell said.
“With super there is something to celebrate in being a bit boring. That boringness is delivering a really good outcome for these investors.”
“At this time of year, everyone asks what is going to happen in the coming year,” Rappell said. “The answer is that whenever you think it is going to be bad it tends to turn out a bit better.”
But in a sign of possible weakness for the future, the strongest returns for balanced funds came in the first nine months of the year before the US dollar began to slide, weighing on the performance of funds that did not hedge their exposure to the US currency.
As of the end of October, members in balanced funds were heading for an annualised gain of 11.5 per cent, just behind growth’s 12.9 per cent after a strong run in international and Australian shares, according to SuperRatings data.
But as inflation concerns bit, returns fell 0.5 per cent in November before ticking up an average of 0.35 per cent in December.
As the strong performance of equity markets continues to drive superannuation returns, funds with higher-than-average exposure to international equity have benefited in 2025, although funds focused on how to manage the ups and downs of the market are reflecting the uncertainties that exist in the market outlook generally, Rappell said.
The end of a calendar year can be a good time to assess where your investments are, Rappell said.
“Although balanced options have delivered negative returns only four times in the past 25 years, it’s important to check how your specific fund is performing and to review any extra benefits it provides such as insurance or higher service quality.”
