market volatility for retirees: your questions answered

It’s natural to feel uneasy when markets fluctuate, especially when you're relying on your HESTA Income Stream to support your lifestyle in retirement.

To help you better understand recent movements and their potential impact, we sat down with HESTA Advice Manager, Alan Sher, to answer some of the most common questions we've received from our income stream members.

I’m worried about how much the balance in my income stream has gone down recently. Can you offer some perspective?

It’s completely understandable to feel concerned when you see your income stream balance fluctuate. Many retired members have been asking the same question—and it’s an important one.

What’s not always well known is that even after you start drawing an income stream, it continues to be invested. This is a key part of helping your money last throughout retirement.

To keep up with the rising cost of living, your super needs to grow. That’s why the Ready-Made investment options are invested in a mix of assets designed to deliver returns that outpace inflation — helping your income remain sustainable over time, whether it's 5, 10, or 20 years into retirement.

“At HESTA, we've managed market changes and volatility before,” Alan shares.

“We’ll continue using the investment principles that serve us in both good and challenging times, always focusing on the long-term and making proactive, strategic decisions.”

While some retirees may choose to reduce investment risk as they age, it’s generally important to consider keeping some growth assets. That balance can help your retirement savings stay on track to support you throughout retirement — not just at the start.

My income stream balance has gone down. Should I change my regular drawdowns?

Income streams are designed to provide steady income in retirement—and they offer flexibility to adapt when life changes.

The good news is, you can adjust your income payments if your circumstances change.

“During times of market uncertainty, some members choose to reduce their drawdowns — particularly if their balance has decreased and they are able to adjust to a lower income temporarily,” Alan says.

“Others, prefer to maintain their regular payments to ensure they can still meet their needs.”

Remember that income streams have government-set minimum drawdown rates each financial year, based on your age and your account balance as at 1 July. As long as you meet the minimum, you’re free to adjust your payments. Market dips often recover over the long term, and you can increase your income again when your balance improves.

Is now the right time to change my investment options?

With global markets experiencing increased volatility, it’s understandable to wonder whether now is the time to change your investment strategy. Shifts in the market can be triggered by many factors.

“It’s important to remember that super is a long-term investment. Most members have spent decades growing their super and may rely on it for many years in retirement,” Alan explains.

“That’s why HESTA takes a long-term view when investing, backed by a team of experienced professionals who manage risk and seek out opportunities — even during challenging times,”

“In periods of market ups and downs, switching your investment options might feel like a way to take control — but it can sometimes lock in losses if the market rebounds after you’ve moved,”

“That’s why we encourage members to stay focused on long-term goals.”

If you’re unsure whether your investment option still suits your needs, speaking to a HESTA Super Specialist is a great next step.

How could Trump's tariffs impact my income stream?

You've likely heard about the tariffs imposed globally. The direct impact of these tariffs is that purchasing goods worldwide now costs more for some countries.

“This has broad implications for producers and manufacturers worldwide, as companies and economies seek alternative suppliers and buyers for goods,”

“These tariff changes are upending the normal trade environment, and that’s why we’re seeing market volatility because of the uncertainty,” Alan explains.

Ultimately, these increased costs and the resulting economic uncertainty can impact the investment markets where your income stream may be invested. The resulting market volatility can lead to fluctuations in the value of income stream balances.

“Once the uncertainty settles and when companies and governments understand what the final outcomes will be, we’ll likely find that investors and markets will stabilise based on having a better understanding of what's going on.” Alan adds.

I don't want my income stream to be invested in the US. Which investment options don't include US exposure?

It's a common question being asked by members lately. Many of us unknowingly interact with major US companies when we go online, or travel and buy goods and services for example. Furthermore, Australia's investment market is relatively small on a global scale.

“To maximise growth opportunities for our members, our investment teams strategically diversify your savings across various global markets,”

“Investing solely in Australia would mean concentrating risk and missing out on significant potential.”

Options like Australian Shares, Cash and Term Deposits are available for those wanting to minimise US investments. However, diversification across different assets and regions can provide more stable returns. Concentrating solely on Australia could limit your exposure to global growth, as many of the world’s largest and most successful companies are based abroad.

Understanding market volatility

Understanding the factors that influence market movements can help provide context during periods of fluctuation. If you’re keen to learn more HESTA's Chief Investment Officer (CIO), Sonya Sawtell-Rickson, share some key market insights and how volatility affects super. Watch the video.