A recent survey conducted for lobby group Industry Super Australia found that a third of industry fund members are considering switching in response to the latest global market swings, with those aged between 18 and 34 the most likely to move.
Super funds are warning younger members could be worse off if they move their money to conservative investment options, after new research showed an increase in the number of people considering switching amid a volatile global market.
Those aged between 18 and 34 were the most likely to change investment options, the survey found, and they also switched in the greatest numbers during the downturns. Almost 40 per cent of this cohort said they are currently seriously considering switching. For many in younger age groups, the recent market downturns have been the first time they’ve lived through the kind of volatility we are currently seeing, said SuperRatings executive director Kirby Rappell.
SuperRatings executive director Kirby Rappell said most young people wouldn’t have experienced the kind of market volatility we are currently experiencing.Sam Sicilia, the chief investment officer of Hostplus, said if people switch their super investment options during market downturns, they then have another tricky decision to make - when to switch back.
SuperRatings found that a member who had a $100,000 balance and switched to cash from a growth or balanced option at the onset of the pandemic would be $35,000 to $45,000 worse off at the end of June this year.