Safeguard Your Retirement: How to Protect Up to $205,000 from Superannuation Risks

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Poorly performing retiree superannuation products could reduce income by $57,000 to $205,000 over the course of retirement, a new report has revealed, leading a consumer group to call for protections for retired Australians.

The report by Super Consumers Australia (SCA) found all of the options that failed the government’s annual performance test this year were also offered to retirees.

However, the government’s exclusions do not apply to products offered to retirees, so people with their retirement savings invested in them are none the wiser.

The federal government is in the process of assessing the performance test, a measure crucial to ensuring financial products meet expected standards. Meanwhile, the Self-Managed Super Fund Association (SCA) is pressing for an immediate expansion of this test to safeguard the interests of retirees, who rely heavily on these products for financial security.

SCA deputy CEO Katrina Ellis said: “It’s unreasonable that a 64-year-old is protected by a performance test, yet the moment they retire and move into an identical product, that safeguard disappears.”

The ‘Securing Australia’s Retirement: It’s time to protect retirees from dud investment options’ report revealed that 91 per cent of failed investment options in the past three years were also available in the retirement phase at the time of failure.

Also, the analysis stated retirees are invested in all seven of the options that failed the 2025 performance test.

In a concerning development, several prominent financial institutions have been identified as offering underperforming retirement products. Among them are AMP, Russell Investments, Colonial First State, and REST, with deficiencies noted across various growth categories. These revelations underscore the urgent need for more stringent oversight and accountability in the financial sector.

An AMP spokesperson told SBS News: “(AMP) strongly rejects the narrow analysis and irresponsible claims made in the Super Consumers report, which gives a misleading picture for Australians considering where to invest their retirement savings.

“The report also fails to take into proper account the different objectives of retirement products, or consider contemporary lifetime income retirement solutions, which are delivering significantly better outcomes for retirees.”

A Russell Investments spokesperson said they were aware of the report and claimed the figures cited for its fund’s options “are not accurate”.

Colonial First State said “In regard to options in the report, APRA assessed the accumulation equivalent of these same retirement investment options and they passed the annual superannuation performance test.

“These options are managed consistently across both accumulation and retirement phases, including the same asset allocation, benchmarks, and investment managers. On that basis, had the performance test been applied to the retirement phase these options would have passed.”

Efforts to reach REST for their perspective on the matter were unsuccessful, as they had not provided a response by the time of publication. This lack of communication raises further questions about transparency and responsiveness among financial service providers.

SCA said almost three-quarters of Australians support extending the performance test to retirement products, with even more calling for greater transparency so retirees can compare how their fund performs.

Ellis said: “The superannuation system is meant to provide Australians with a dignified retirement, not leave them in the dark about whether their money is working for them.”

“Retirees deserve the same protections as workers. Without them, people risk losing hundreds of thousands of dollars in retirement income and living standards will suffer.”