(Bloomberg) -- Australia’s fast-growing A$4.1 trillion ($2.6 trillion) pension industry posted double-digit returns in the 2024 calendar year, buoyed by the strong rally in global share markets, according to estimates from research house SuperRatings.
The median balanced option, the default retirement savings product where most Australians have their money, returned an estimated 11.5%, beating last year’s 9.6%, SuperRatings said Tuesday in Sydney. The vast majority of options are expected to deliver a return of more than 10% for the year, it said.
“Most of this year’s returns have come from share markets, which are now priced at historical highs both in Australia and internationally,” SuperRatings Executive Director Kirby Rappell said in an emailed statement. “A correction in share markets would have a strong flow-on effect to members’ superannuation balances and members should be prepared to see ups and downs over the short term.”
Australia’s pensions industry, known as superannuation, is raking in billions of dollars of mandatory employer payments, currently worth the equivalent of 11.5% of workers’ salaries. That number will rise to 12% in 2025. Assets are forecast to more than triple by 2048, according to a Mercer report, with a dozen mega-funds seen controlling more than A$100 billion each by 2028.
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