Top performers revealed as super funds charge through 2024 with double digit returns

Kirby Rappell

Despite a post-Christmas stumble resulting in December returns falling into the red, it was full steam ahead for funds over 2024 with returns boosting member balances in 10 out of the 12 months in the year. The median Balanced option reported a -0.4% return in December, but 11.1% for the full 2024 calendar year, comfortably exceeding last year’s strong result of 9.6%.

The median growth option returned -0.5% in December and 13.4% over the year, while a smaller allocation to shares resulted in the median capital stable option returning -0.1% for the month and 6.4% across the year.

Pension members also had a bumper year with the median pension balanced option returning -0.5% in December, but 12.3% over the year.

International shares were once again the standout performer in 2024, led by strong growth in US shares. Despite a disappointing December return, Australian Shares also contributed double digit returns over the year. Returns were further enhanced by strong property and infrastructure asset returns, while fixed interest and cash returns provided a more modest but still helpful mid-single digit return.

Funds continue to deliver for members over the longer term. An investment of $100,000 in the median balanced option 15 years ago would now be worth $280,237 while investing in the median growth option would now be worth $307,519. Members who invested in cash would have $141,117.

Raiz Super was the top performer in the SuperRatings Balanced Index with its Moderately Aggressive option returning 14.7% over 2024. Hostplus’ Indexed Balanced option was next, returning 14.2% while Colonial First State First Choice Personal’s CFS Enhanced Index Balanced option took third place, returning 13.4% over the year.

Superannuation remains a long-term investment for most, with many members having several decades of returns before retirement. It is therefore important to remain focused on longer term returns, with the top performing funds over 10 years listed below.

The Hostplus – Balanced option remains the top performer over the long-term, with an average return of 8.4% pa., closely followed by Australian Retirement Trust – Super Savings – Balanced with an average return of 8.3% pa. AustralianSuper’s Balanced option rounds out the top three over 10 years with an average return of 8.1% pa.

With shares driving most of 2024’s returns, passive investment options, where a fund tracks a specified index, have outperformed their more traditional actively managed counterparts over the year. Aware Super lead the pack when assessing passive option returns with its Balanced Index option returning 15.7%.

The table below displays the top 10 passive fund returns over 2024 and over 5 years, with most of these options having been available within superannuation for a shorter length of time.

Younger members in MySuper options using a lifecycle model have also benefitted from strong share markets as these funds tend to have higher exposure to growth assets, particularly for members under the age of 45-55.

We have taken a representative cohort below, showing the returns expected to have been realised for younger members (under 45 years old in 2024) in these products.

2024 will be the second consecutive year members invested in lifecycle options have benefited from their higher exposure to growth assets. While members will be happy to see the benefits of this investment design, it is worth noting that the higher exposure to growth assets will also result in greater ups and downs and members invested in these options should be prepared to see their balances shifting over time.

Investments with a sustainable focus have also outperformed over the year with Raiz Super’s Emerald investment option delivering 16.9% to members over 2024. The option was also the top performing sustainable option over 5 years, with a return of 14.8% per annum.

We expect 2025 to be dominated by global events, with changes in US policy following the start of Trump’s second term as president, China’s economic stimulus outcomes and the Ukraine war all likely to create short term noise across markets. The new year is a good time for members to consider the level of ups and downs they are willing to tolerate and do a health check on their fund across performance, fees and insurance.

We saw inflation moderate around the world in 2024; however, the outlook in Australia remains uncertain with a lowering of interest rates unlikely in the short term. While funds have done well for members over the past year, conditions remain challenging and a focus on long term outcomes is required.

SuperRatings Executive Director Kirby Rappell said, “Despite the uncertainty in markets, funds have consistently delivered positive outcomes for members over 2024. With a strong double digit return for most funds, members can be reassured their retirement savings continue to grow. However, 2025 could bring many potential pitfalls and sticking to a long-term strategy is important should we start to see balances falling. High levels of diversification continue to insulate members over time, resulting in impressive long-term performance by those managing our retirement savings.”