Behaviours to avoid to maximise your retirement income

Retirement is a pretty abstract concept for most people until it’s upon us. Yet there are some decisions we all commonly make that can unintentionally reduce our retirement income. How can CSC help you overcome these?

07 Sep 2021

Retirement looks different to everyone. Whether it is spending more time with family, travelling, learning a new skill, starting a new business, or simply having more time to relax and enjoy life, most of us will hope to retire comfortably with a level of income that funds our preferred lifestyle.

There are things that we can do to make sure we’re getting the most out of our retirement savings. However, decisions we make about our super today can often be influenced by our own unconscious biases.

This article draws on the insights from a global investors panel[1] that CSC’s Chief Investment Officer (CIO), Alison Tarditi participated in, along with Richard Thaler, Nobel Memorial Prize winner in behavioural economics and Roger Ibbotson, Professor in the Practice Emeritus of Finance, Yale School of Management.

The panel discussed the predictably irrational ways people behave and we see this behaviour in Australian superannuation members. For example:

  • The status quo bias. Despite having compulsory super, there seems to be a trend in apathy when it comes to saving for retirement. We see this in the statistic that only 12% of Australians have actually exercised choice in their investment options[2].
  • The bias toward disposable income. An attitude of ‘spend for now’ rather than ‘save for later’ is particularly erosive in the early phases of accumulation, because at that stage contributions matter a lot more to building a balance than investment returns.
  • Bias in regret towards loss, rather than opportunity cost. Investing in super is a long-game, and just like any investment it comes with risk. But, loss aversion can lead to less wealth accumulation than risk appetite, or the capacity to take risk, would suggest.

These common biases in decision-making may not always be in our best interest in the long-run. This is why our investment philosophy at CSC takes these biases into account—when we make decisions about investment, we make them with you, our customers, in mind.

Our investment approach is based on a number of principles, which include:

  • Importance of product design. Our investment objectives reflect your needs. They are built to help you on the way to the highest probability of achieving a comfortable retirement income, taking into account retirement needs, the cost of living, health costs, risk appetites and circumstances[3].Furthermore, our three pre-mixed investment options are designed to specifically address the needs of each work life-stage. To give our customers confidence that they can choose the option best suited to their life-stage, each of these aim to generate a high return for each unit of risk they take.
  • Investing for the long-term. We seek to acquire high-quality assets, with sustainable growth potential, when they are available at fair or better-than-fair prices. We actively manage these assets on your behalf, taking pro-active decisions so that the assets remain of high quality and, where possible, improve over time.
  • Take rewarded risk. Our investment governance processes and risk management are world-class[4]. These are essential to support real-time decision making and innovation.


For example, these principles have supported our capacity to directly invest in the most appealing parts of the capital structure of windfarms, data centres and hospitals. They have helped us to secure sole ownership of high-quality properties; manage their operation efficiently and to the highest environmental, social and governance (ESG) standards to maintain their investability; and re-invest in their operational efficiency so that these may continue to generate robust, reliable cash flows, with capital appreciation. Our team assesses all risks—such as financial, environmental, social, governance, technological, and regulatory risks —in an integrated way, and applies due-diligence to each investment.

As a result of our long-term investment strategy, we’ve been able to achieve consistently strong retirement outcomes across all of our options[5].

Our approach in our Balanced fund option across all our Schemes is differentiated from that of other providers because it reflects the characteristics of our member base, not the general Australian population.  As a result, we are expecting that our balanced option will incur a smaller loss in value than peer funds, when markets fall.  We also expect that it will also capture most but not all of the upside in markets, as they become increasingly driven by sentiment and herd mentality rather than fundamentals. This pattern has been consistent in our balanced fund, where we have avoided 39% of the downside in markets but still capture around 89% of the upside over the past 10 years to 30 June 2021*.

In this way, over the time-frames that matter to our customers, our wealth accumulation is very competitive and our customers are less vulnerable to the state of financial markets regardless of when they time their retirement.  Most recently, our customers received much stronger returns than peers (avoided 40% of loss compared to peer median in SuperRatings universe) over the sharpest and quickest COVID-19 related market downturn in March 2020.  Furthermore, CSC’s Balanced fund is consistently ranked above peers over long horizons when comparisons take into account the amount of risk that members’ are exposed to[6].*

Whether it be actively choosing your investment option, making additional contributions, using our online interactive retirement calculator, or attending one of our retirement seminars, CSC is committed to help you, our customers, have the information you need to retire comfortably.

* Past performance is not a reliable indicator of future performance

[1] Amundi World Investment Forum, 14 June 2019, Paris. You can watch the presentation at

[2] Since the panel was filmed, this has increased to 16%. Source: APRA Annual MySuper statistics June 2020, defined as “Number of member accounts as a result of member investment choice” divided by “Number of member accounts at the end of period”.

[3] Our balanced-fund investment objective of CPI + 3.5% per annum is specifically derived from understanding those needs and is consistent with supporting our customers to receive an income in retirement at least equivalent to the Association of Superannuation Funds of Australia (ASFA) “comfortable standard” by the time they reach the age of 65. 

[5] For example, the funding ratio (projected assets vs ASFA comfortable standard) for full-time PSSap customers is currently estimated at 137% as at 30 June 2021.

[6] In its annual industry-wide survey of superannuation fund investment returns, independent ratings agency, SuperRatings reported that the CSC Balanced fund option ranked in the first quartile of peers on a risk adjusted returns basis for 7 and 10 years to 30 June 2021 and above median for 3 and 5 years. The CSC Aggressive fund option was at the top end of first quartile in its peer universe for all periods while the CSC Income Focused fund option was ranked first for time periods greater than one year. The CSC retirement income Balanced fund return was first quartile over all time periods.


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