Investment Strategies in Superannuation Funds

CORPORATE FINANCIAL MANAGEMENT
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Executive summary
There are various types of strategies present, in which an employee can invest and multiply their
savings. One of the most important strategies is funding with the help of superannuation funds.
Investment in the superannuation strategies has been very popular among the employees for
gaining benefits on their savings. The employees are needed to clearly strategize the investments
before opting for the most appropriate approach they're going to invest their savings. Hence, this
report will clearly suggest all the facts that are needed to be analyzed by the tertiary sector
workforce to judge if it is valuable to invest their life savings in the superannuation approach or
not. The report also consists of various types of plans which can be selected by the employees to
invest their savings.
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Superannuation contributions
There are various types of schemes present in an organization that help the tertiary sector
workforce to generate returns on their savings. One of the most common strategies is an
investment with the help of superannuation funding techniques. The most important objective of
superannuation contribution is to collect a small part of the employee’s salary every month and
make a proper savings plan so that they can live their life peacefully after their retirement. The
collection of the superannuation funds as a part of the employee’s salary has been made
mandatory in many of the countries in order to inculcate the habit of savings among employees.
This makes it necessary for employees to provide their contribution in the superannuation funds
and later the financial analysts or institutions are given the task of underwriting them in proper
portfolio and schemes so as to earn high interest that can be returned to the individuals. The
financial institutions are required to analyze the market and choose the most appropriate scheme
of the portfolio in which maximum return will be provided on the investments that have been
saved by the employees over the years of service.
The economic sectors of a nation are generally divided into three constituencies of the
secondary, primary and tertiary sector (Berry, 2009). The relevancy of the superannuation
contribution can be determined on the basis of the area in which an organization lays its
management structure. The most important task of a tertiary sector employee is to give the best
options for making investments that can help organizations to maximize the returns and hence it
plays an important role for the application of knowledgeable skills that can further help to
improve the productivity of the organizations and other areas. For past few years, it was
observed that 3% of the total employee’s salary was contributed as a collection of
superannuation funds but after 2009 this rate was to go as high as 9%. A minimal amount of
money which is gathered by the organization is also used for advertising of these kinds of
methods so that they can improve their social security systems and also collect the money so that
their employees can retire peacefully. It has been observed that many renowned organizations
have been established to take good care of the superannuation fund that has been collected by the
employees. These financial institutions analyze the market and invest the money in eligible plans
so as to earn maximum interest on their savings. The financial firms will also make it easier for
the workforce to determine the type of plans they are going to underwrite their savings in.
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