When it comes to superannuation, getting a better return on your money is a topic many of us are keen to explore. After all, your super is one of the most important investments you’ll make in your lifetime, so making smart decisions early on can significantly impact your financial future. This has been my experience, and I’d like to share how I managed to double my super balance in just six years by choosing a high-growth, high-risk strategy.
A little background: after completing my double degree in arts and commerce from the University of Wollongong, I spent six years working in the banking sector before launching Parking Made Easy. Like many others, I accumulated several super accounts over the years from different jobs, all of which were sitting there with small balances, earning minimal returns.
I decided it was time to get serious about my super. Using the ATO’s myGov online service, I consolidated all my scattered accounts into one. This was the first step in taking control of my future, and I encourage anyone who hasn’t done so yet to look into it. Having one account simplifies things and can save you money in fees.
The next step was deciding how to invest it. I didn’t want to stick with the default, conservative investment option. I’m still relatively young, and with retirement far off, I felt I could afford to take on more risk. So, I opted for a leveraged high-growth fund, which meant the fund would borrow money to increase its exposure to the share market.
Now, I know that investing in the share market can be nerve-wracking—especially after witnessing the volatility during the Global Financial Crisis (GFC). I saw firsthand how unpredictable things can get, but I also knew that over the long term, markets tend to recover and grow. With that in mind, I decided to take the plunge, believing the ups and downs would even out in my favour over time.
Since making that decision, my returns have been substantial—an annualised 17%. It’s a strategy that’s paid off, with my balance doubling in just six years. I’m not suggesting that high-growth, high-risk investments are for everyone. It’s essential to consider your risk tolerance and how far you are from retirement before making any big moves with your super.
The key takeaway from my experience? Don’t be afraid to review and adjust your super investment strategy, especially as your circumstances change. For younger people with time on their side, a more aggressive approach can be rewarding, but always ensure it aligns with your risk tolerance and financial goals.
After all, super is about securing your future, and every decision you make today can shape how comfortable that future will be.
Disclaimer: This is for informational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor before making any investment decisions.
