Your super protected

Title: Protect your retirement savings from market volatility
Short description: How can you protect your savings from negative investment performance and still take advantage of investment growth? It’s called MLC MasterKey Investment Protection. Here’s how it works.
Topics: mlc:Topics/news-and-updates
Time to read/watch: 5 min
Effective date: 2024-11-18 00:00
Feature Image: /content/dam/mlc/insights/images/Articles/2024/your-super-protected/your-super-protected.jpg
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Safeguarding your retirement savings

Growing your super, even after you’ve retired, is essential to building the wealth you need for a secure and comfortable retirement. That’s why it’s important to protect your retirement savings if the market falls and allow your investment to grow if the market goes up. MLC MasterKey Investment Protection allows you to deal with the changing market today.

The basics of MLC MasterKey Investment Protection

MLC MasterKey Investment Protection is only available through a licensed financial adviser and to members who have a MLC MasterKey Super or Pension Fundamentals account, with eligible MLC Investment options. You also need to be 50 years of age or older, and you need to have between $30,000 and $1.5 million to protect.

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As part of one of the largest super providers in Australia,* we’re focused on delivering competitive returns, so your money continues to grow. When it comes to support, we go the extra mile—providing you with general super advice.

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What is Investment Protection?

Investment Protection allows you to protect one investment option in your MLC MasterKey Super or Pension Fundamentals account. This means your savings are protected if the market goes down and your investment still grows if the market goes up. You can choose from two types of protection:

Protected Capital, which protects your investment over 10 or 20 years, and
Protected Income, which provides you with a minimum level of income each year for 10 or 20 years.

1. Protect your retirement savings from market downturns

With Protected Capital you will know what your minimum Investment Balance will be at the end of a 10- or 20-year term. Your savings are protected from negative investment performance, and growth in your investment can increase the minimum Investment Balance you receive at the end of your term.

With Protected Capital, you’ll have the:

Security of knowing your investment is protected,
Confidence to invest in a diversified growth portfolio, and
Ability to grow your investment and lock in market gains each year.

If you’re aged 50 or above, you can invest in an eligible investment option with Protected Capital for a term of 10 or 20 years. This initial investment amount is the minimum you’ll have at the end of your term.¹

If the market falls during this time you don’t have to worry because your money is protected.

On the other hand, if the market goes up, whatever amount your investment has increased to on your investment anniversary date, is locked in.

Your Investment Balance is the actual balance of your protected investment option. This may be more or less than your Protected Value at any one time.

Your Protected Value is the amount locked in each year on your protection anniversary date. Your Protected Value won’t fall belove this locked amount even if your Investment Balance goes down. This is the minimum amount in your account at the end of your term.

Download the Investment Protection Guide here to learn more.

2. Protect and grow your retirement income

With Protected Income, you can protect the income you take out from your account Your income amount will not be affected by negative investment performance and can increase as a result of investment growth.

With Protected Income, you’ll have the:

Certainty of knowing your income is protected,
Confidence to invest in a diversified growth portfolio,
Potential to increase your Protected Payments, and
Choice of when you start receiving your income once you’ve retired.

Your Protected Payment is the income amount you can take out of your protected investment option each year without reducing your Protected Value.

If you’re aged 50 or above, you can invest in an eligible investment option with Protected Income for a term of 10 or 20 years.

And, when you’ve reached your preservation age (the age you must reach before you can access your super savings), you can choose when you’d like to start receiving your Protected Payments. The initial investment amount is your Protected Value from which your Protected Payments are calculated.

If markets go up, your Protected Value has the potential to increase.

And, once you start receiving your Protected Payments, you have the confidence of knowing your income is protected for the rest of your term.

How we calculate your Protected Payments each year

10-year term: 10% of your Protected Value

20-year term: 5% of your Protected Value

You can also add a Spouse Benefit option to your protection for an additional fee.

Have the confidence to live the retirement you want

As you get closer to retirement your investment time horizon changes and market movements can have a greater effect.

That’s where MLC MasterKey Investment Protection comes in.

MLC MasterKey Investment Protection is only available through a licensed financial adviser. You also need to be 50 years of age or older, and you need to have between $30,000 and $1.5 million to protect.

Things you need to consider

You need to make sure the term you choose is consistent with your investment timeframe if you’re to get the full benefit of your protection. This means if you choose a 20-year term, you need to be willing to remain in the same investment option for 20 years.

Once your protection has started, you can’t change it. So before investing, make sure you’ve chosen the right protection and investment option to suit your needs.

For more information on MLC Investment Protection download the Investment Protection Guide.

Get set in the right direction with help and guidance available over the phone, online or face-to-face.

¹ Eligible members need to have between $30,000 and $1.5 million to protect.
* Based on KPMG Super Insights 2023 Report as at May 2023 KPMG Super Insights 2023 Report. Page 7 “In 2022, there were seven mega-funds. Insignia became third in both members and assets…”

The information in this article is current as at November 2024 and may be subject to change.

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Important information and disclaimer

This article has been prepared by NULIS Nominees (Australia) Limited ABN 80 008 515 633 AFSL 236465 (NULIS) as trustee of the MLC Super Fund ABN 70 732 426 024. NULIS is part of the Insignia Financial group of companies comprising Insignia Financial Ltd ABN 49 100 103 722 and its related bodies corporate (‘Insignia Financial Group’). This information may constitute general advice. The information in this article is general in nature and does not take into account your personal objectives, financial situation or needs. You should consider obtaining independent advice before making any financial decisions based on this information. It is recommended that you consider the relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) before you make any decisions about your superannuation. You can obtain the latest copy of the PDS (or other disclosure documents) and TMD by calling us on 132 652 or by searching for the applicable product at mlc.com.au. You should not rely on this article to determine your personal tax obligations. Please consult a registered tax agent for this purpose. Opinions constitute our judgement at the time of issue. The case study examples (if any) provided in this article have been included for illustrative purposes only and should not be relied upon for decision making. Subject to terms implied by law and which cannot be excluded, neither NULIS nor any member of the Insignia Financial Group accept responsibility for any loss or liability incurred by you in respect of any error, omission or misrepresentation in the information in this communication.