The benefits of combining ETFs and super
Superannuation is like preparing for a long road trip—you need a reliable vehicle and a clear path to reach your destination. But understanding where your money is invested and how it’s performing can feel like driving without a map. This is where Exchange Traded Funds (ETFs) come in. Think of ETFs as a well-oiled engine that simplifies the journey, providing smooth and cost-efficient performance.
By combining ETFs with a smart superannuation strategy, you create a sturdy vehicle that can handle the ups and downs of the financial road, keeping you on track for long-term growth. At Stockspot Super, we bring together the benefits of ETFs with a clear, efficient approach to managing your super, giving you a roadmap that leads to a more secure financial future.
Here’s why we believe combining ETFs with super is a smart move.
Diversification made easy with ETFs
ETFs make diversification simple. Each ETF is a collection of assets such as shares, bonds, or commodities – that trades like a single share. When you invest in an ETF, you gain exposure to a wide range of assets, reducing the risk associated with any single investment underperforming.
Stockspot Super uses ETFs to create diversified portfolios based on your age. Your super is spread across different asset classes, industries, and regions, including Australian shares, global shares, bonds, property, and commodities – such as gold. This diversified approach captures growth opportunities while managing risk.
The best part is that Stockspot handles the selection and management of these ETFs, so you don’t need to worry about managing an SMSF. We take care of everything, giving you a balanced portfolio that’s tailored to your financial needs.
Transparency: know where your money is invested
Many traditional super funds aren’t very transparent, which can make it hard to know exactly where your money is invested or how the funds it’s invested in are performing. With Stockspot Super, transparency is key. We give you full visibility over your portfolio, including the specific ETFs you own and their performance.
Stockspot Super doesn’t own any unlisted assets with infrequent valuations. This ensures you don’t overpay when your contributions are invested since all of Stockspot’s recommended ETFs adjust to their fair market value daily.
Through the Stockspot Portal, you can track your investments anytime, giving you peace of mind and control over your retirement savings. This level of transparency is rare in the superannuation industry and helps you stay informed about how your super is growing.
Tax-efficiency: keep more of your returns
Taxes can significantly impact your superannuation returns, so managing them effectively is important. Stockspot Super offers a tax-efficient approach by using ETFs and a discrete account structure.
In traditional pooled super funds, tax liabilities are shared among all members. With Stockspot Super, you have your own personal super account, which means you only pay taxes on your own gains, interest, and dividends. This structure keeps your returns from being affected by others’ tax events.
ETFs also tend to be more tax-efficient because they have lower turnover rates than actively managed funds, resulting in fewer taxable events. This means you retain more of your investment returns over the long term, helping your super grow more efficiently.
Flexibility without the complexity of an SMSF
Many Australians consider setting up an SMSF to gain control over their super investments, but managing an SMSF comes with complexity, compliance requirements, and costs. Stockspot Super provides flexibility without the hassle, giving you the benefits of a personalised portfolio without the administrative burden.
In addition to the core ETF-based portfolios, Stockspot offers Sustainable Portfolios and Stockspot Themes for investors who want more customisation.
- Sustainable Portfolios: If you want to invest in companies that meet environmental, social, and governance (ESG) criteria, Stockspot’s Sustainable Portfolios allow you to align your investments with your values while still achieving strong financial returns.
- Stockspot Themes: For those looking to customise further, Stockspot Themes let you focus on specific sectors or trends, such as technology or climate impact. This flexibility allows you to build a portfolio that reflects your interests without the complexity of an SMSF.
Cost-effectiveness: lower fees, more savings
Fees can erode your superannuation over time, so keeping costs low is a smart move. ETFs are known for their cost-effectiveness because they are typically ‘passively’ managed – meaning, they buy and sell assets less frequently. This results in lower management fees compared to actively managed funds.
At Stockspot Super, we focus on keeping fees low. You pay a flat management fee that covers everything from portfolio management to regular reviews and rebalancing. Lower fees mean more of your returns stay invested, helping your super grow faster over time.
A balanced approach for long-term growth
Combining ETFs with superannuation allows you to benefit from diversification, tax-efficiency, and lower costs. This combination creates a well-balanced, cost-effective portfolio that helps manage risk and supports long-term growth.
Whether you’re just starting your super journey or preparing for retirement, ETFs offer a straightforward, effective way to build a diversified super portfolio. Stockspot Super’s approach ensures your super is working for you, using ETFs to provide a smarter, more efficient way to manage your retirement savings.
Conclusion
ETFs have recently reached $200 billion in Australia and have revolutionised investing by providing a low-cost, easy-to-understand way to diversify. When combined with superannuation, they offer a powerful tool for long-term growth and tax efficiency. Stockspot Super makes it easy to take advantage of these benefits, offering a tailored ETF-based portfolio without the complexity of an SMSF.
With options like Sustainable Portfolios and Stockspot Themes, Stockspot Super allows you to personalise your investments while keeping fees low and maximising returns. Combining ETFs with super can be a smart strategy for anyone looking to grow their retirement savings efficiently.
If you’re ready to make your super work harder for you, explore how Stockspot Super can help you achieve your financial goals with a simpler, smarter approach to investing.
When will Stockspot Super be available?
We are looking to launch Stockspot Super in late 2024. Join the waitlist to get early access. When we launch to the public, a PDS will be made available on the Stockspot website and you should read this as well as other relevant disclosure documents before making any decision to open an account.
