Investing your super
Wondering how investing and superannuation work together? Our team explains.
A property investment isn’t just restricted to buying a house and renting it out – in fact, you can access other kinds of property investments without taking out a mortgage to buy one outright.
Now, you can pool your money with other investors to buy units in a professionally managed fund which holds a number of property investments.
This can give you access to a range of property types across a range of sectors – from shopping malls and hotels, to medical centres and office spaces.
Property funds can invest in property that is either listed on the share market or owned directly.
Listed property funds can more easily buy and sell investments, which means they can take advantage of changing market conditions. However, this can also make them more exposed to share market fluctuations – meaning their values can change from day to day.
Property funds that invest directly into property are less able to change their investments. But as these investments are not listed, their values are likely to be more stable and less volatile over time.
You will find that over time, your super balance fluctuates depending on the different funds your super is invested in and the risk associated with different investments.
It can help to speak to a financial adviser when considering your investment options.
Wherever you stand on investments and super, we’re here to help you get to where you need to be. Click through for a more detailed explanation of property investments.
A property investment isn’t restricted to just buying a house and renting it out. In fact, there are other options outside of directly owned investments that can offer you access to property without having to spend the large sums of money often associated with buying one directly. These options involve you pooling your money with other investors to buy units into a fund or trust.
If you aren’t buying a property directly, these investments can be otherwise accessed within super (depending on your super fund’s allocation to different investments), or outside of super through a listed or unlisted fund or real estate investment trust (known as a REIT):
There are risks associated with all investments, including property. For example:
Both listed and unlisted property investments have the potential to offer attractive, risk-adjusted returns over the long term – typically through rental income that is paid to investors of a fund or trust through regular distributions. Returns from a direct property investment can also come through rental income that may be paid either directly to the owner, or via a real estate agency managing the property on the owner’s behalf.
What you choose to invest in will depend on a number of factors, such as your age, life stage, personal circumstances and the advice you might receive from a financial adviser. An investor may consider fixed interest investments like bonds for their traditionally defensive, conservative nature – particularly if the investor is older, approaching retirement and/or seeking capital preservation.
Disclaimer
Information on this webpage is provided by Avanteos Investments Limited ABN 20 096 259 979, AFSL 245531 (AIL) and Colonial First State Investments Limited ABN 98 002 348 352, AFSL 232468 (CFSIL). It may include general advice but does not consider your individual objectives, financial situation, needs or tax circumstances. You can find the Target Market Determinations (TMD) for our financial products at www.cfs.com.au/tmd, which include a description of who a financial product might suit. You should read the Financial Services Guide (FSG) available online for information about our services. This information is based on current requirements and laws as at the date of publication.
Tax considerations are general and based on present tax laws and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information.
AIL and CFSIL are not registered tax (financial) advisers under the Tax Agent Services Act 2009 and you should seek tax advice from a registered tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise under a tax law.