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James Coyle
James has over 35 years experience in financial services with particular expertise in two of the key components of retirement finance - Superannuation and the Age Pension. He is passionate about providing the guidance and support that can help older Australians enjoy their best possible retirement. He lives in regional Victoria surrounded by dogs and chooks.
I am 69 and currently drawing an income stream from my superannuation. What would be considered the breakup of assets within Conservative, Balanced and Growth options. My current spread is as follows:
Cash – 29%, Fixed Int – 18%, Aus Shares 11%, Int Shares 12%, Property 30%. Would this be considered conservative.
Thank You
Hi Gary. Thanks for the question. The labels Conservative, Balanced and Growth are used by many super funds to describe their investment options but they don’t always use a consistent approach to asset allocation. This can be very confusing for people as the same asset allocation could be described as Balanced by one fund and Growth by another. I’ve listed below the asset allocations HESTA, one of Australia’s largest funds, uses as a guide.
HESTA High Growth: 89% Growth Assets and 11% Defensive assets
HESTA Balanced Growth: 70% Growth assets and 30% Defensive assets
HESTA Conservative: 36% Growth Assets and 64% Defensive assets
Typically cash and fixed interest are defensive assets and Australian shares, International shares and private equity are growth assets. Some funds consider Property and Infrastructure to be defensive assets while others put them in the growth category. Listed property and direct property can also be treated differently. There are lots of permutations to this which makes it hard for most of us to get our heads around it. The asset allocation you have would tend to be described as quite conservative however that can depend a little on the make-up of the property component.
One of our Advisers could help you get a better understanding of this in a risk tolerance consultation if you would like to book a consultation.