Is Superannuation an Asset?

You hear a lot of talk about superannuation, but what exactly is it and is it considered an asset? A lot

of Australians have questions about superannuation, especially when it comes to the different types

of assets available. In this blog post we’ll break down what superannuation is, how it works, and

answer the question – Is Superannuation an Asset?

What is Superannuation?

Superannuation is a type of retirement savings account that allows you to save for your retirement

while you are still working. It’s designed to provide you with a steady stream of income during your

golden years. Generally speaking, you can access your super fund at age 65 or later. Contributions to

your super fund are made by you, your employer or both – with contributions coming from pre-taxed

income. Your super fund will invest these contributions into different types of assets such as bonds,

shares and managed funds in order to grow the value of your investment over time.

The Types Of Assets Available Through Super Funds

When investing through a super fund there are two main types of assets available –growth assets

and defensive assets. Growth assets aim to generate capital growth over time through investments

in equities (shares) and property whereas defensive assets provide a more consistent return by

investing in fixed interest investments like government bonds or cash deposits. The mix between

growth and defensive assets will vary according to each individual’s investment objectives and risk

profile.

Is Superannuation An Asset?

It’s important to note that superannuation itself isn’t actually considered an asset; rather, it’s the

holdings within the fund which are considered ‘assets’. This means that when you invest money into

your super fund, you’re essentially buying into specific types of investments such as shares or

managed funds which fall under the categories of either growth or defensive assets (as discussed

above). As such, when people ask ‘is superannuation an asset’, they’re really asking if their money

invested into their super fund counts as an asset for them – which it does!

In conclusion, we can see that although superannuation itself isn’t an asset per se, all the money

invested into a person’s super fund certainly counts as one! It’s important to understand how this

works so that you can make informed decisions regarding where best to invest your money in order

to maximize returns and ensure financial security during retirement. Knowing the difference between

growth and defensive assets can also help you make those decisions based on how much risk you’re

willing to take on versus how much capital growth potential you want. All this being said – yes indeed

-superannuation is most definitely an asset!