Market volatility and your super 

Many Australians have been keeping a close eye on their super and retirement accounts in recent weeks, with investment markets experiencing increasing turbulence. And while recent falls in some account balances may feel unsettling, in the context of long-term investments like super and retirement savings, there’s good reason to keep things in perspective. 

Market volatility 

If you’ve ever checked your super balance and noticed a drop or sudden change in its value, you’ve probably experienced the effects of market volatility. Market volatility is simply a term to describe the ups and downs that happen in the value of investment markets and individual assets.  

All types of investments can go and up and down in value, but frequent changes in value over shorter time frames are most often associated with growth investments like shares. And right now, we’re seeing that play out with widespread falls in share market values just over the past few weeks.  

Depending on how your savings are invested, that can result in changes – in this case a drop – in your account balance. So what’s happening, and should we be worried? 

Uncertainty and the link to volatility  

A wide range of factors can create uncertainty and trigger fluctuations in market values, from economic shifts, political developments and changing investor sentiment, through to geopolitical conflict and natural disasters. 

Currently, as new US President Donald Trump implements his policy agenda, we’re seeing elevated volatility across global share markets. Investors are trying to decipher the economic impact of US trade policy (everyone’s talking about tariffs), and the shifting geopolitical landscape. The abrupt policy changes have created uncertainty, and this will take time to resolve.  

Meanwhile, the end result for super fund members with either accumulation accounts or retirement accounts, is a noticeable drop in some account balances – particularly those that are heavily invested in Australian and overseas shares. 

Is this the new normal?  

Rather than a ‘new normal’, periods of volatility in share markets have always been normal. Share markets do experience, and always have experienced, fluctuations in value – sometimes significant ones – over short time frames. But at the same time (and this is the good news) time and again history shows us that those same share markets have recovered from these periods to produce steady growth over longer time frames. 

Why is this good news for super and retirement savings in particular? Because super, by its very nature, is a long-term investment – one that’s likely to be held for decades. So, while you may see volatility in your super balance from time to time, and sometimes even over prolonged periods, it’s important to view this in a longer-term context.  

And that long-term context can be just as relevant for those approaching or in retirement as it is for younger people still in the workforce. While our investment objectives and our tolerance for risk tend to change over time, investing through retirement is still a long-term proposition. After all, retirement could be 20 or 30 years or more. 

Time, not timing  

Even so, it can be tempting to switch your investment options in response to market volatility. But the reality is it’s incredibly difficult to predict exactly when to buy or sell based on short-term fluctuations. Even seasoned investors struggle with timing the market well and timing it consistently. 

Instead, history tells us that remaining invested in the market and staying the course for longer periods of time has proven to be more effective than chopping and changing investments in response to short-term movements. For instance, the S&P/ASX 200, which includes the top 200 Australian companies, has grown by over 220% in the past 20 years, even with significant market events like the global financial crisis and the COVID-19 pandemic.  

We know from experience that, as long-term investors, we need to be patient when it comes to riding out the day-to-day ups and downs in investment markets, even in times of significant volatility. 

Learning from experience  

Since 1931, Equip Super has been managing members’ retirement savings – that’s nearly 100 years. During that time we’ve helped countless members weather some of the most volatile investment conditions in living memory – global depressions, world wars, natural disasters, pandemics. 

In fact our active investment strategy is designed to navigate all market conditions, the strong and the weak, in order to deliver solid, long-term returns for our members.  

A strategy that stands the test of time 

Diversification is at the forefront of our investment strategy – not just across asset classes, but also within them. We fundamentally believe diversification is the most important tool we have to combat the impacts of shorter-term volatility in investment markets.  

In fact, periods of volatility can provide opportunities for long-term investors. A diversified portfolio allows us to take advantage of those investment opportunities in different asset classes as and when they arise, and at the same time mitigate the impact of underperformance in other investments and asset classes. 

3 tips for navigating uncertainty  

Market volatility is a normal part of investing in growth assets like shares, but it doesn’t have to cause stress or uncertainty. Here are three things to help you stay informed and confident when it comes to your investments. 

1. Maintain a long-term perspective 

While it’s natural to feel concerned when your balance dips, remember that the value of your super and even your retirement investments is ultimately shaped by years, even decades, of market activity.  

See how we apply a long-term strategy when it comes to managing the Fund’s portfolio.

2. Stay up to date with your investments 

Your retirement savings will likely be one of the biggest investments you’ll ever have, so it’s important to understand how your money is invested and whether those investments are meeting your needs and objectives. 

Our website provides a range of resources to help you learn more about your investments, and choosing investments to suit your needs. 

3. Get a little help from the experts 

If you’d like to talk to someone about how your account is currently invested, our team is here to help. We can answer your questions and take you through the options available to you – it’s all part of the service. 

We can even put you in touch with an Equip Super Financial Planner for more comprehensive support. An initial appointment is available at no extra cost for members. 

 In Conclusion 

While market volatility is part of investing, it doesn’t have to cause stress or uncertainty. By staying focused on your long-term retirement goals, understanding market cycles, and relying on proven strategies like “time in the market,” you can navigate market ups and downs with confidence. And with the right tools and expert advice, you’ll be better equipped to make informed decisions that keep your super on track for the future.