September Snapshot

A rational person only accepts any form of risk if they feel the outcome of doing so (the reward) is likely to be better than if they hadn't taken the risk. Arguably the biggest area of value for our clients is helping to evaluate what the risks are, and how to best improve the chance of reward!

When it comes to building long-term wealth, understanding how to navigate investments is key.

While shares and growth assets may experience short-term dips compared to cash or bonds, they typically deliver superior returns over time. That’s why having significant exposure to them in your superannuation makes sense.

Reacting to market downturns by switching to cash might feel like a safe move, but it often locks in losses and undermines your wealth-building potential. In fact, the less frequently you check on your investments, the less likely you are to make decisions based on short-term emotions, such as selling at the wrong time.

It’s important to view both super and shares as long-term investments, tailoring your strategy to your age, income, wealth, and risk tolerance. Additionally, keep in mind that any early withdrawals from your super can have a big impact on your retirement savings. For example, withdrawing $20,000 at age 30 could reduce your balance at retirement by around $74,000, as you miss out on the power of compounding returns.