A good superannuation return depends on the investment option you’re in, the time period measured, and market conditions. For most Australian members in a balanced or growth MySuper option, a 7–9% annual net return over 10+ years has historically been considered solid — though past performance is not a reliable indicator of future returns.
The Right Benchmark for Your Option
Comparing returns across super funds is only meaningful if you’re comparing the same type of investment option. A high-growth option (90% shares) will typically show higher returns over long periods than a balanced option (70% shares) — but also more volatility.
| Investment option | Typical growth/defensive split | Historical long-run net return (est., various) |
|---|---|---|
| Cash | 100% defensive | 2–4% |
| Conservative | ~30% growth / 70% defensive | 4–5.5% |
| Balanced | ~70% growth / 30% defensive | 6–8% |
| Growth | ~80% growth / 20% defensive | 7–9% |
| High growth | ~90–100% growth | 8–10% |
These are illustrative ranges based on historical data. Actual returns vary. Past performance is not a reliable indicator of future returns.
The APRA Performance Test Threshold
APRA’s annual MySuper performance test uses a strict benchmark: a product fails if its 8-year net return is more than 0.5 percentage points below the benchmark constructed using the fund’s own asset allocation.
This means a “passing” fund is one that is within 0.5% of what its benchmark would have returned with the same asset mix. A fund that consistently underperforms its benchmark by, say, 0.8–1.5% per year is considered significantly underperforming.
What “After Fees” Means
Reported super returns are almost always net of investment fees (the ICR or indirect cost ratio) but before administration fees. Your actual return to member is lower by the administration fee.
Example:
- Fund reports 8.5% net investment return
- Annual administration fee: 0.10% (flat $55/year on $50,000 = 0.11%)
- Approximate return to member: 8.39%
For funds with high flat dollar administration fees (e.g., $170/year), the impact is larger for small balances.
Short-Term Volatility vs Long-Term Returns
Super invests through market cycles. Even excellent long-term funds have negative years:
- A balanced fund might lose 10–20% in a major market downturn (e.g., GFC in 2008–09, COVID in 2020)
- The same fund typically recovers and delivers strong cumulative returns over the following years
This is why 1-year returns are a poor indicator of fund quality. 10-year returns are far more meaningful. If your fund had a bad year during a market downturn, that may reflect broad market conditions rather than fund-specific underperformance.
Assessing Your Fund’s Return
| Step | What to check |
|---|---|
| 1. Find your option | Check your member statement or online portal for your investment option name |
| 2. Get the return | Log in to your fund’s portal or check the annual statement for 1, 3, 5, 10-year returns |
| 3. Compare | Check the ATO YourSuper tool or APRA heatmap for comparable products |
| 4. Adjust for risk | Only compare options with similar SRM (risk) ratings |
| 5. Consider fees | A fund with 8.0% return and 0.5% fees beats a fund with 8.5% return and 1.5% fees |
Frequently Asked Questions
Is 7% a good return for super? 7% per year net of investment fees over 10+ years is broadly in line with or slightly below the top-performing balanced MySuper options. Whether it’s “good” depends on the risk level taken — a conservative fund achieving 7% would be outstanding; a high-growth fund achieving 7% might be below average for its category.
My super returned 15% last year. Is that normal? Strong single-year returns (12–20%) occur during strong market years (e.g., 2021, 2024) and are not sustainable in the long run. The long-run expected return for a balanced option is typically 7–9% p.a. after fees, reflecting an average across both good and bad years.
What return do I need to retire comfortably? The retirement income projections on the ASFA standard assume roughly a 7% long-run return in many models. The MoneySmart retirement planner uses a conservative default assumption — check moneysmart.gov.au for their current default rates.
For more: 10-Year Super Fund Returns, Returns by Asset Class, APRA Heatmap. For advice on your super, speak with a licensed financial adviser via MoneySmart.