Your attitude/tolerance to risk

Any type of investing involves some risk. Superannuation is generally a medium to long-term investment and therefore has its own particular risks. For instance, taxation laws could change over time and affect things such as the final amount of your benefit or how and when it can be paid.

There are also investment risks, for instance:

• The risk that your balance could be reduced by negative returns
  This risk is highest in the Growth or Balanced option as there could be some periods of negative or very low returns. It is also possible in the Conservative option but it is less likely than for Growth. This risk is lowest in the Cash Enhanced and Cash options.
• The risk that the amount of income you will receive will vary
  This could be a problem where a fixed predictable income is required such as an allocated pension. Again, this risk is more likely in the Growth or Balanced option than in Conservative or Cash Enhanced and is lowest in the Cash option.
• The risk that you will use up your capital early or that your investment will not keep pace with inflation
  These risks are greatest in the Cash Enhanced and Cash options where long-term returns are expected to be lowest.

How do you feel about a negative return from time to time?

If you worry about the volatility of your investments, you might be more comfortable having less than 100% in Growth, for example, as it carries the greatest risk that your investment will fall from time to time.

Overtime all economic and financial markets move in cycles that vary in length. Diversification is a key factor in minimising risk. Some investments have a higher risk than others – some have a lower risk. High-risk investments may give good returns, low risk investments may not. Diversifying your investment options means that the investments that are doing well can offset or at least reduce the impact of those that aren't.

Seek advice

This information is general in nature and does not take into account your personal objectives, financial situation or needs.

A licensed financial planner can work with you to choose the right investment option to suit your needs and retirement goals.

Maritime Super can arrange for a qualified financial planner to help. Contact Member Services to arrange an appointment.