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So what does that actually mean? What are super funds investing in, and how does superannuation actually work?
What is superannuation and how does it work?
You can also make additional voluntary contributions, which will compound over time.
When you retire, you can access your superannuation as a lump sum, income stream, or combination of both.
What are ethical superannuation funds?
This often comes in the form of environmental, social and governance funds, which market themselves as being more ethically responsible.
“The main reason why they’re doing that is not because they want to impose particular values on their portfolio, but there’s a recognition that for companies that aren’t behaving in a responsible way, that’s actually going to have an impact on their future performance,” he said.
“If a company’s doing some things which is harmful to society or to the planet, then that’s not going to work for the long term,” Fryer said.
Can you check what your super fund invests in?
Brody said that, while the information is limited, transparency is increasing.
“There can also be issues where many super funds appoint an investment management firm to invest on its behalf, and that might be a way in which we have less disclosure about what actual investments are being made by super funds.”
What do Australia’s major super funds invest in?
Super funds also keep a portion of their members’ money in cash holdings.
Commonwealth Bank, NAB, and Microsoft rounded out the top five.