Life plan ... Rose Fox has consolidated her super into one fund. Life plan ... Rose Fox has consolidated her super into one fund. Photo: Quentin Jones
Some super funds are now offering the in-built option of reducing risk as you age, writes John Kavanagh.
The markets have been highly volatile over the past few weeks with big swings on local and overseas shares and fixed interest markets. But what about your super fund? Is it exposed to these risks and should you change your portfolio option to have greater security?
Super fund members should have different attitudes to risk, depending on how old they are and how long they expect to have their money invested before they retire.
The younger you are the more risk you can afford to take. That is because the risky assets are the ones that tend to produce higher returns over time.
But as you get closer to retirement your priorities change.
You start thinking more about capital preservation. Your super fund investment option should have more defensive assets to reflect that.