THE RISK WITH LETTING SOMEONE ELSE MANAGE YOUR MONEY
You would be forgiven for being a bit nervous about checking your superannuation balance this end of financial year, thanks to a turbulent few months on the global stock markets.
And chances are your super balance will have taken a big hit, with research house Chant West predicting the typical super fund will fall by 5% for this financial year in the worst performance since the Global Financial Crisis.
Yes, superannuation is a long-term investment – so annual returns shouldn’t be read in isolation. But the picture won’t be any prettier if you are a member of any one of the ten funds given a “fail” rating in the most recent APRA MySuper heatmap.
The financial watchdog’s performance assessment was based on each fund’s seven-year net investment return, so there’s no room for any ‘one bad year’ excuses there.
This brings us nicely to the risk of letting someone else manage your money.
Is your super fund doing a good job of managing your money?
The superannuation sector was worth over $3.4 trillion at the end of the March 2022 quarter. However, the vast majority of Australians (62.5%) are in default superannuation accounts with very little control over where and how their nest egg is invested.
As a result, those decisions are left to the fund manager instead – which would be fine if they are doing a good job. The problem is, some aren’t, with more than $100 billion of Australians’ money invested in an underperforming super fund in October 2020, according to Treasury statistics.
It gets worse because, as we all know, Australians pay some of the highest superannuation fees in the world, totalling some $30 billion a year. So when you make extra contributions, there’s a danger you could get charged a high fee for a subpar return.
Fortunately, it doesn’t have to be this way.
Want more control, predictable income payments… and an inflation-busting return?
In contrast, when you invest in mortgages with Credit Connect Group, you have full control over where your money goes.
Invest as much or as little as you want by selecting the individual loan type, loan amount, return, term, location and LVR that matches your investment goals and risk profile
Credit Connect Group manages the entire loan on your behalf – so all you have to do is sit back and wait for the monthly interest payments to land in your bank account.
Does a high return always mean high risk?
At Credit Connect Group, your investment is secured by a registered first mortgage against property in Australia. Our conservative lending ratios (the maximum LVR is typically 65%) reduce the risk further.