Quick Look
Focus: How to compare super fund types and choose the right one for your needs
Key Takeaways :
Superannuation is one of the most important financial assets most Australians will ever have. But with more than $3.7 trillion in the system (APRA, 2024), deciding how to manage your super can feel overwhelming.
Whether you’re curious about more control, looking for lower fees, or just trying to avoid a poor choice, the right fund type depends on you—not the ads.
Let’s break down the differences between industry funds, retail funds, and self-managed superfunds (SMSFs) so you can make a smart, confident decision.
The biggest myth in super? That there’s a “best” fund type for everyone.
In reality, what suits one person may be totally wrong for another. The wrong choice could mean higher fees, poor returns, or unnecessary stress. For example:
Fund types differ in four main areas:
Understanding these differences is the key to avoiding costly mistakes.
Best for: Everyday people wanting hassle free, low-cost, reliable super management
Example : A 35-year- old with $80,000 in super might pay ~$600 per year in admin and investment fees
Retail Funds
Best for: Those wanting more choice, but not full SMSF control
Tip: Check for platform or adviser fees
SMSFs
Best for: SMSFs can be more cost-effective at higher balances, but suitability depends on costs, complexity and your strategy.
Warning: SMSFs are not set-and-forget. You’re legally responsible for keeping everything compliant under complex legislation and all but the very experienced will need professional advice annually.
Decision Flowchart–Which Fund Type Might Suit You?
Do you have over $250,000 in super?
Do you want to pick your own investments (e.g. direct shares, property)?
Do you have the time, skills and interest to manage a fund?
Case: Leah (Age 47, Super Balance $300,000) Leah is a business owner who wants to invest part of her super into a commercial property. In her current retail fund, she can’t access direct property After advice, she sets up an SMSF for $3,000 with ongoing cost of $3,000 for admin annually.
She uses $200,000 of her balance (plus borrowings) to purchase a small office for her business. If structured correctly and on arm’s-length terms, the business may claim rent as a business expense, while the SMSF receives rental income.
Outcome: For Leah, control and strategy outweighed the admin burden. But it wouldn’t suit someone with a lower balance or less experience.
Isn’t SMSF always cheaper than retail funds?
Not necessarily. Unless your balance is over$250,000–$300,000,SMSFs are usually more expensive to run because the admin is a fixed basic cost which is additional to the investment fees.
Can I switch between fund types later?
Yes—but watch for transaction costs, buy/sell spreads, insurance changes and timing risks.
Are industry funds really “ better ”?
They’re often cheaper and simpler. But “better” depends on your goals. If you know what you’re doing and have a professional adviser to point you in the right direction, retail funds are much more viable and can be cheaper depending on your objectives and stage of life.
Can I hold property in any super fund?
Only SMSFs can directly buy and hold real property and borrow. Industry and retail funds can still provide property exposure, but you generally don’t control the specific property assets directly.
Will I lose insurance if I leave my fund?
Usually you will but always check what cover you have—and whether a new fund can match or continue it—before switching.
Choosing the right fund type isn’t about picking the “best” one—it’s about picking what suits you right now.
Industry and retail funds work well for most people. SMSFs can offer flexibility but come with serious responsibility. The good news? You can reassess over time.
Learning how these fund types differ puts you in the driver’s seat. And when you’re ready to make a move, professional help can make the next step smoother and safer.
Is your super invested in the right option?
moneyGPS helps you assess whether your current investment mix aligns with your goals, timeframe and risk tolerance.
Delivered online for $198. Start free and get the advice when it suits you.
Need Full Scope Financial Planning?
If you think you might need a holistic roadmap that leaves nothing out, consider booking a discovery meeting with a fully licensed Financial Planner.
Book a discovery call with Planning IQ today and take the first confident step towards comprehensive wealth management.
Disclosure: General information only. Consider your objectives, financial situation and needs, and seek professional advice before acting.
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Disclaimer: All information on Super Advice Ai is general in nature only and does not take into account your personal objectives, financial situation or needs. You should consider whether any information on Super Advice Ai is appropriate to you before acting on it. If Super Advice Ai refers to a financial product, you should obtain the relevant Product Disclosure Statement (PDS) or seek professional advice from a licensed financial planner.
