Fund Choice 2025: How to Choose the Best Super Fund in Australia

Superannuation remains one of the most significant financial assets for Australians. Yet, the choice of fund—often made quickly or left to default—can have a powerful influence on your long-term financial wellbeing. In 2025, with ongoing regulatory reform and a dynamic investment environment, reviewing your fund choice isn’t just prudent—it’s essential.

Why Fund Choice Matters More Than Ever in 2025

The superannuation sector has seen sweeping changes over the past five years. The introduction of the Stapling Rule (where your super fund follows you from job to job) and the annual performance test for MySuper products have put underperforming funds in the spotlight. In 2025, APRA’s latest performance heatmap and the expanded Choice Product testing have made it easier than ever to compare funds—but also more critical to act if your fund is lagging.

• Performance transparency: APRA now publicly identifies underperforming funds, making it easier to spot laggards.
• Fee scrutiny: With pressure from ASIC, funds have reduced hidden fees, but some still charge high admin or investment fees that erode returns.
• Investment options: More funds are offering ESG (environmental, social, governance) and sustainable investment choices in response to member demand.

Recent data shows a 2% gap in annual returns between the best and worst performing MySuper funds. Over a 30-year working life, that could mean hundreds of thousands of dollars difference at retirement.

How to Compare Super Funds in 2025

Australians now have more tools and data than ever to compare super funds. Here’s what to look for:

• Long-term performance: Focus on net returns over at least 5–10 years, not just last year’s figures. APRA’s heatmap is a great starting point.
• Fees and costs: Even a 0.5% difference in fees can significantly impact your final balance. Use the Moneysmart Super Fund Comparison Tool to see real fee impacts.
• Insurance cover: Check if the fund’s insurance suits your needs and isn’t too expensive. From July 2024, default insurance for new members under 25 is opt-in only.
• Investment options: Does the fund offer the right mix for your risk appetite? Many now offer tailored options for different life stages or ethical investing.
• Member services: Consider digital access, advice offerings, and educational support.

For example, an analysis in early 2025 found that Hostplus and AustralianSuper consistently delivered strong net returns, while several smaller retail funds failed APRA’s performance benchmarks for the second year running—triggering a mandatory notification to members.

Switching Funds: Steps and Traps to Avoid

If your fund is underperforming or charging high fees, switching is straightforward but requires care:

1. Check for exit fees: Most have been abolished, but confirm with your fund.
2. Review insurance: Changing funds can affect your insurance cover or lead to exclusions if your health has changed.
3. Consolidate accounts: Use the ATO’s online services to roll multiple accounts into one and avoid paying duplicate fees.
4. Notify your employer: Provide your new fund’s details to ensure future contributions go to the right place.

A real-world example: In 2025, Sarah, a 35-year-old teacher in Melbourne, switched from a retail fund charging 1.4% in fees to an industry fund with 0.75% fees and better 10-year returns. The difference? Projected extra retirement savings of over $120,000 based on her current salary and contribution rate.

Looking Ahead: The Future of Fund Choice

Regulators are expected to ramp up scrutiny of underperforming funds, and the rise of green and social impact investment options is giving members more choice to align their super with their values. Digital advice tools are also making it easier to tailor your fund and investment strategy to your personal goals.

Don’t set and forget your super—your future self will thank you for making an informed fund choice in 2025.