Retirement savings recovery as SuperRatings boss Kirby Rappell unveils 9.6 per cent growth for balanced funds

Australia superannuation funds recovered almost 10 per cent in 2023, potentially getting members back double the losses they suffered in share falls of 2022. Research group SuperRatings said balanced funds returned an average 9.6 per cent in the 12 months to December 31 as shares surged around the world and higher interest rates rewarded savers. SuperRatings estimated that balanced funds enjoyed a 2.8 per cent boost in December, a welcome end to a year in which funds endured losses in five of the 12 months. It credited the gains to technology shares in the US, strong returns by Australian shares and higher interest rates increasing the returns from cash investments. But it saw flat property markets as being “a small drag on overall returns”. SuperRating executive director Kirby Rappell said the volatile returns in 2023 highlighted the importance of investors remembering super was a long-term investment. “It has literally paid for members to focus on the long term in 2023,” Mr Rappell said. “This year’s return follows the pattern of a strong rebound after a negative year.” While SuperRatings sees inflation slowing into 2024, it warned markets would remain sensitive to local and global events. Balance funds lost an average 4.8 per cent in 2022, their fourth year of losses since 2000. The research group estimates balanced funds have averaged 6.5 per cent annual growth since 2000, which is in line with the common target of inflation plus 3 per cent. It defines balance funds as having between 60 per cent and 76 per cent growth assets.