Key takeouts in 10 seconds:
Markets go up and down: It’s normal. Your super will do the same.
Think long-term: Super is for retirement; short-term dips in balances are expected and part of a bigger picture.
Diversify investments: most of Rest’s investment options are diversified, being in different asset classes can help smooth super returns over time.
We can help: before making any decisions or changes to your super, reach out to a Rest Super Specialist.
If you've noticed that your super balance has gone down recently, it's important to understand why this happens and what it means for you and your super. Share markets go down, share markets go up - it's to be expected. Recently we saw the U.S. share market experience a drop – and for many of us, that drop was reflected in our super balances. This was after President Trump made various policy announcements (such as those on tariffs and immigration), which caused markets to react. However, it is important to remember that this was off the back of the U.S. share market experiencing an all-time high just last month, and strong returns over the past 2 years. This is a natural part of investing – markets can move up and down in response to global events, policy changes, and economic forecasts.
These fluctuations can be unsettling, but they're a normal part of investment cycles. Our Rest Investment experts plan for this when investing on behalf of you/our members.
The key takeaway here is that super is meant to be a long-term investment, building up as you work towards retirement.
Here are some essential points to remember:
- Keep perspective: Markets go up and down, and short-term drops don't necessarily indicate a long-term trend. Historical data shows that markets have bounced back from lows to achieve growth over longer periods of time.
- Focus on the future: Your super is geared towards the future – your retirement years. Immediate market ups and downs are less significant if you’re looking at a timeline that spans decades.
- The danger of trying to time the market: Trying to guess the best times to get in and out of the market is very challenging, even for professionals. By attempting to avoid losses by switching investment options during a market drop, there's a risk of missing out on the recoveries and gains when the market goes back up.
- Embrace diversification: Most of Rest’s investment options contain a mix of assets to balance out risks and returns. Different asset classes typically don't move in sync. This means when some are down, others may be up. This helps to smooth super returns over time.
What should I do next?
Before making any decisions about your super based on recent market movements, a better approach would be to consider your risk appetite, and how your current investment option/s fit within your broader financial goals and timeline. Making impulsive changes could derail your long-term strategy.
A good next step is review your investment options (which you can do on the Rest App, or by logging in to your Rest account online).
For more information on Rest’s investment options you can visit https://rest.com.au/investments/options.
I’m close to retirement – what additional support can you give me?
We suggest you reach out to us for help from our Rest Super Specialists – this comes at no additional cost. You can book in a call at https://rest.com.au/tools-advice/advice/advice-phone-form.
I’d like to know more about markets going up and down.
To learn more about market dynamics and how they relate to super balances, read this article on understanding why your super balance goes up and down. You can also check out some of our Super Tips articles below for more valuable information.
