How are we managing your retirement savings?

While COVID-19 is a genuine surprise, the evolution of financial, debt, and economic trends over the last few years have seen us progressively increase the diversification of your portfolios and continuously enhance the quality of our material private asset exposures.

18 Mar 2020

Financial markets today are under stress.  They are processing the economic consequences of a complex set of events.  The COVID-19 pandemic threatens health and causes a temporary, though potentially severe, loss of income for households and businesses.  These uncertainties, together with the collapse in oil prices, as Saudi Arabia seeks to gain market share from other producers, and fears about the nature of policy responses, are contributing to falling share prices.  

While COVID-19 is a genuine surprise, the evolution of financial, debt, and economic trends over the last few years have seen us progressively increase the diversification of your portfolios and continuously enhance the quality of our material private asset exposures.  

Our investment team is constantly reviewing the risks associated with all your exposures in light of a range of fast-moving indicators such as:

  • the number of new COVID-19 cases around the world;
  • credit market dynamics;
  • sentiment and capital flows;
  • the pace at which China’s industrial production resumes;
  • economic fundamentals across the globe more broadly;
  • financial system stress; and
  • the adequacy of government and policy responses.

We are proactive and singularly focused on stewarding your savings through this period, with due caution, but also without compromising your capacity to participate in the recovery, which will eventually come.  How we position the portfolio now will be important to achieve this goal. This is our focus.

 

Your retirement horizon, your investment option

At times like these, it’s important to consider how long you have until retirement when making decisions about the most appropriate investment option for your individual circumstances.

CSC has four investment options: Aggressive, MySuper (Default), Income-Focused and Cash.

You can check which investment option—or mix of options—you currently have by logging into your account at https://www.csc.gov.au/Members/Log-in/

The table below may guide you with which option to consider for your individual circumstance.

Investment Portfolio Option Investment Return Objective Risk Limit Investment Horizon
 Aggressive CPI + 4.5%

Probability of Annual Loss: 30%
Negative years in 20: 6

 15 years
 MySuper (Default) CPI + 3.5%

Probability of Annual Loss: 20%
Negative years in 20: 4

 10 years
 Income-Focused CPI + 2.0%  Probability of Annual Loss: 10%
Negative years in 20: 2
5 years
 Cash Account Bloomberg AusBond bank index rate of return, net of fees Probability of Annual Loss: 0%
Negative years in 20: 0
1 year
 

We’re here to help

 

If you have any questions, please contact us directly—we’re here to support you with whatever you need. 

 

As you’re seeing, many businesses are currently implementing plans to ensure continuity of the services they provide customers.  As we do that, you may notice some changes in the services we provide, to protect you and our teams.  Specifically we have started to change our group and individual seminars from face to face, to virtual.  We’ll keep you updated on any further changes we make.

 

 

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