Is your super safe? What every aussie needs to know after recent fund failures

Thousands of Australians have been swept up in one of the country’s biggest super-related investment fund failures, losing a combined $1.2 billion in retirement savings. The collapse of the First Guardian Master Fund, Shield Master Fund and Australian Fiduciaries has left more than 12,000 investors in financial limbo. 

While offered through well-known retail super platforms linked to names like Macquarie, Netwealth and Diversa, these schemes were not part of regulated MySuper products—something that might have been immediately apparent. In the case of First Guardian, ASIC believes as much as $446 million could be missing.

The fallout has triggered multiple ASIC investigations, court action and asset freezes, with financial advisers and super trustees now under scrutiny for their role in recommending or hosting these funds. Regulators are also working with APRA and the federal government on stronger protections, while a review of the Compensation Scheme of Last Resort (CSLR) is underway to ensure it can better support victims when financial advice goes wrong.

What can you do if your super’s been impacted?

If you’ve lost money through one of these schemes, you may still have options:

• Reach out to the Australian Financial Complaints Authority (AFCA) to see if you are eligible for compensation under the CSLR. This scheme can provide up to $150,000 to consumers who have an unpaid determination relating to personal financial advice. Just make sure your adviser’s licensee is still a current member of AFCA, as this affects your eligibility.
• If AFCA rules in your favour but the company involved can’t pay, you may be able to access the CSLR to recover your money. But time is of the essence—many of these providers are winding down or shutting shop altogether, so it’s important to act quickly.

Tips to help protect your super

Even if you haven’t been affected, this is a good reminder to stay on top of where your super is invested and who’s managing it. Sally Tindall, Canstar’s Finance Expert, says the recent investment fund collapses should be a wake-up call for anyone with a super fund.

“Just because an investment is accessed through a reputable super platform doesn’t mean it’s a safe bet,” she says. “If your adviser suggests switching to a less well-known fund, ask to see the research and make sure it suits your goals and risk profile. If you’ve been cold-called or felt rushed into something—now is the time to speak up.”

Sally also warns that many investors don’t realise their money has even been placed into these kinds of schemes until something goes wrong. That’s why it’s so important to review your super at least once a year and understand exactly where your money is invested.

Review Your Super Strategy

There are some simple steps you can take right now to help protect your super:

• Consider sticking with a MySuper option: MySuper products are designed as low-cost, simple default options that meet strict government regulations and are performance-tested every year. Unless you have the knowledge, time and appetite for risk to manage your own investments, sticking with a MySuper option can help protect you from complex, higher-risk products.
• Ask for transparency from any potential provider: Before agreeing to any new investment within your super, insist on clear, written information about fees, commissions, and the structure of the fund. 
• Ask your adviser the tough questions: Make sure any recommended investment has been independently researched and clearly explained—including risks, fees and any conflicts of interest—and ask your advisor about the platform where your money is actually going.
• Audit your statements regularly: Check your super statements line-by-line to make sure your money is exactly where you think it is. If something doesn’t look right, raise it with your fund immediately and, if needed, seek independent financial advice.
• Don’t rely on cold calls or pressure sales. If someone contacts you out of the blue about moving your super, it’s okay to hang up or ask for a second opinion.
• Act fast if you’re concerned: If you suspect your super has been moved into an unfamiliar or high-risk product without your full understanding, contact AFCA or your fund as soon as possible. Time limits apply for making complaints, and in some cases, delays could reduce your chances of recovering lost funds.

What to Do if Your Super Fund Isn’t Performing Well?

If your super fund doesn’t pass the Australian Prudential Regulation Authority’s (APRA) annual performance test, they’re required to let you know. While it’s never fun to hear your fund isn’t measuring up, it’s also a great opportunity to check whether your money could be working harder for you.

Start by comparing the key features of different funds—things like fees, long-term investment returns, and any insurance cover included. If you have a MySuper product, the ATO’s YourSuper comparison tool can make this even easier, showing you how your fund stacks up and helping you explore other options that might put you in a stronger position for retirement.