Key considerations when selecting a default super fund as an employer

In so many ways, Australia is the envy of the world, both for individuals as well as business owners large, mid-sized and small. This includes the country's ability to help its citizens save smartly for retirement.

If you do some research, you'll discover that a lot of people across the world are simply not in a position to retire whatsoever, never mind comfortably. This is largely because they don't have the savings set aside to maintain their lifestyle and associated costs upon making the transition to retirement.

It's a different story for an impressive segment of our country. As the highly respected Grattan Institute concluded in its 2018 report regarding retirement readiness, a majority of Australians will be able to retire when the time comes, with men averaging approximately $112,000 in savings. 

Much of this is made possible by superannuation, which is flush with cash. According to the latest figures available from the Association of Superannuation Funds of Australia, assets totalled roughly $3.1 trillion at the end of the March 2021 quarter, with a majority of that total invested in Australian and global equities markets. 

Long story short, as an employer who makes regular contributions to your employees' super, you want to ensure you're truly getting the most bang for your buck by selecting a default fund that offers a high rate of return consistently. You also want to choose one that is in keeping with your goals and values as a business. Here are a few key pointers when selecting a default super fund so you can make it truly super: 


Prioritise long-term sustainable performance

Your most engaged workers give their 110% to deliver for the company; they deserve a super fund that will come through for them in terms of performance. It can be difficult to gauge which product to select in terms of what will produce the best return, but a good rule of thumb to go by is track record and consistency. The ideal is long-term sustainable returns. There may be some funds that offer higher performance but those could be accompanied by fluctuations where the return is minimal. 

In short, since retirement can stretch several decades, the returns should be long lasting and have staying power.


Review performance history

It is said that the best predictor of future behaviour is past behaviour; the same standard frequently applies in the super space. Depending on how long the fund has been around, see if you can find information on a rate of return over the past five to 10 years. History isn't always a good barometer, but it can offer key clues that can help you make a more informed decision. 


Assess where profits go

This goes hand in hand with doing your due diligence in terms of performance track records. You as well as your employees are making regular contributions; shouldn't they be the ones who reap the rewards? All too often, though, the profits of large super funds are for the benefit of their shareholders more so than their members. Ask your default fund, “Where do your profits go?” If they don’t say their members, you are probably with the wrong fund.  


Evaluate ethics

You're undoubtedly an organisation that places a great deal of importance on corporate responsibility. As such, you want to avoid investment practices that are contrary to what you stand for. Here as well, it's key to do your research to see to it that the default super fund takes ethics and responsible investment as seriously as you do. If the super fund is not in keeping with your values and what you hold near and dear, choose another fund.

When it comes down to it, you want your default super fund to work every bit as hard for you and your employees as they do for your organisation. At Active Super we feel the same way. From comprehensive member and employer support to investment guidance, Active Super is fully committed to providing you with high-quality service and sustainable, long term returns, all aligned to responsible investment standards. From protecting Orangutan habitats to investing in the Sydney Desalination Plant producing high quality drinking water for up to 1.5 million people — if you’re an Active Super member or employer, you can sleep well at night knowing that Active Super is investing in a strong, sustainable future.

Email us at, or call us on 1800 636 441 weekdays between 8.30am and 6.00pm and see why more businesses choose to become an Active Super employer