Comparing AusSuper and Aware Super: A Comprehensive Analysis

When it comes to superannuation funds in Australia, two prominent players are AusSuper and Aware Super. Both funds have a strong presence in the industry, catering to a diverse range of members with various investment needs. This article provides an in-depth comparison of AusSuper and Aware Super, exploring their history, performance, fees, returns, and asset management.

Overview of AusSuper

History

AusSuper was established in 2001 as a result of the merger of several smaller funds, primarily focused on the Australian workforce. It has grown to become one of the largest superannuation funds in the country, serving over 3 million members and managing billions in assets.

Assets Under Management

As of the latest reports, AusSuper manages over AUD 200 billion in assets, making it one of the largest super funds in Australia.

Performance and Returns

AusSuper has consistently delivered strong returns over the long term. For example, its Balanced option has historically achieved an average annual return of around 8% over the past decade. Returns can vary based on the chosen investment option, but AusSuper is known for its robust performance, particularly in diversified investments.

Fees

AusSuper employs a competitive fee structure. Members typically pay a flat administration fee plus investment fees that vary by the chosen investment option. As of recent data, the annual fees for members can range from approximately 0.5% to 1%, depending on the account balance and investment choices.

Pros and Cons

Pros:

• Large Scale: As one of the largest super funds, AusSuper benefits from economies of scale, often resulting in lower fees and better investment opportunities.

• Strong Performance: Historically strong returns, particularly in diversified and growth-oriented options.

• Member Support: Comprehensive member services and resources to assist with retirement planning.

Cons:

• Investment Choices: Some members may find the range of investment options limited compared to boutique funds.

• Fees: While competitive, fees can add up, particularly for lower-balance accounts.

Overview of Aware Super

History

Aware Super was formed in 2020 following the merger of First State Super and the State Super Fund. It has a long-standing history, dating back to 1992, with a focus on serving employees in the public sector, although it has since expanded its offerings to a broader membership base.

Assets Under Management

As of the latest available figures, Aware Super manages approximately AUD 140 billion in assets, making it one of the top super funds in Australia.

Performance and Returns

Aware Super has also demonstrated strong long-term performance. Its default MySuper option has delivered an average annual return of around 8% over the last decade. Aware Super focuses on responsible and sustainable investment practices, which is appealing to many socially conscious investors.

Fees

Aware Super offers a competitive fee structure as well, with annual administration fees generally ranging from 0.5% to 1.2%, depending on the account balance and investment option selected. The fund aims to keep fees transparent and manageable for members.

Pros and Cons

Pros:

• Responsible Investment: Aware Super has a strong emphasis on sustainability and ethical investing, appealing to socially responsible members.

• Comprehensive Support: A range of educational resources and tools for members to help them understand their retirement savings.

• Strong Historical Returns: Consistently competitive returns across various investment options.

Cons:

• Limited Investment Options: Some members may find fewer choices compared to larger funds, particularly in niche investment strategies.

• Recent Formation: Being relatively new, it may lack the historical performance data that some members seek.

Comparison of AusSuper and Aware Super

Performance and Returns

Both AusSuper and Aware Super have shown strong historical returns, averaging around 8% per annum over the last decade. However, individual performance can vary based on the chosen investment strategy and market conditions.

Fees

• AusSuper: Typically ranges from 0.5% to 1% in annual fees.

• Aware Super: Fees range from approximately 0.5% to 1.2%, with efforts to keep them competitive.

Investment Options

• AusSuper: Offers a range of diversified options, including conservative, balanced, and growth-oriented funds.

• Aware Super: Focuses on sustainable and responsible investment options, alongside traditional diversified choices.

Asset Management

• AusSuper: Over AUD 200 billion in assets under management.

• Aware Super: Approximately AUD 140 billion in assets under management.

Member Support

Both funds provide comprehensive member support, including retirement planning tools, educational resources, and personalized financial advice.

Conclusion

Choosing between AusSuper and Aware Super ultimately depends on individual preferences and investment goals. AusSuper offers a larger scale with a strong historical performance, while Aware Super emphasizes responsible investing and comprehensive member support. Both funds are well-regarded in the industry, making them strong contenders for Australians looking to secure their financial future through superannuation. As always, prospective members should carefully consider their unique circumstances and investment strategies before making a decision.