APRA reveals 13 super funds that failed its performance test

More than one million Australians are members of underperforming super funds, according to results from the latest MySuper Product Performance Test performed by the Australian Prudential Regulation Authority (APRA).

Your superannuation fund is one of those financial products that Aussies tend to set and forget, but this mentality could be costing you big time.

APRA has assessed the returns generated by superannuation funds over the past seven years, as well as their fees, and listed those that do not meet its objective benchmark. APRA has revealed that 13 super funds of 76 tested have failed its assessment.

Super funds with MySuper products that failed the test - APRA

• AMG Super
• ASGARD
• Australian Catholic Superannuation and Retirement Fund
• AvSuper Fund
• BOC Gases Superannuation Fund
• Christian Super
• Colonial First State First Choice
• Commonwealth Bank Group Super
• Energy Industries Superannuation Scheme-Pool A
• Labour Union Co-Operative Retirement Fund
• Maritime Super
• Retirement Wrap
• The Victorian Independent Schools Superannuation Fund

APRA Executive Board Member, Margaret Cole, said: “It is welcome news that more than 84 per cent of products passed the performance test, however APRA remains concerned about those members in products that failed.”

“Trustees of the 13 products that failed the test now face an important choice: they can urgently make the improvements needed to ensure they pass next year’s test or start planning to transfer their members to a fund that can deliver better outcomes for them," Ms Cole Said. 

These 13 funds will now have to write to their members by 27 September 2021 to let them know that the super fund holding their retirement nest eggs have failed the government test.

They will also have to sit down with APRA to identify why they failed the test and what measures they can put in place to lift their game. If they don’t, and they fail again next year, then they could be blocked from taking on new customers until they improve.

If your super fund didn’t pass the test, what should you do?

If your superannuation fund is listed above and you have received a letter, don’t panic just yet. Instead, consider using this as motivation to see if other superannuation funds on the market may better suit your financial goals.

Top performing MySuper funds

The ATO allows you to view top performing superannuation funds using its YourSuper Comparison Tool. Based on this data, here are the top performing MySuper products, based on its leading “7-year net return” funds.

Top performing super funds with MySuper products - ATO

Source: ATO YourSuper Comparison Tool.

Note: Rankings based on an average 30-year-old Australian with a $50,000 balance (excluded any restricted funds).

Switching superannuation funds is not a financial decision to take lightly, so it’s best to weigh up the pros and cons of both options before deciding. You will also want to assess the following factors against your own preferences and financial situation:

• Performance
• Fees
• Insurance options
• Investment options
• Customer service

Even if you don’t get a letter, it is still worth checking in on your super funds’ performance at least once a year to assess your returns, the fees you’ve been charged, and whether you’re got the right product for your life stage.

Remember if you do decide to make the switch to ensure you notify your employer you’ve changed funds, and that you close the old superannuation account down. The last thing you want is for two lots of super fees eating into your nest egg.

Compare super funds