Choose from super terms A-Z
Means Australian Business Number. The Trustee's ABN is 85 064 225 841. The Australia Post Superannuation Scheme's ABN is 42 045 077 895.
This is a professional person with special qualifications in analysing financial transactions and assessing risks. Actuaries report to super fund trustees on the financial positions of funds.
In general, accumulation accounts are members’ superannuation accounts where the benefit is determined by an accumulation of:
An accumulation account works much like a regular bank account, but with superannuation rather than regular money. Unlike a bank account, you generally don’t have ready access to your money because it’s intended that this money will be available for you to use in your retirement.
APSS Member Savings accounts (i.e. Employee, Spouse and Rollover Accounts) are accumulation accounts. APSS Pension Accounts are also accumulation-style accounts, although no additional amounts can be contributed to these accounts once the pension has commenced and the balance will decrease over time as a result of pension payments and lump sum withdrawals (if permitted).
Refers to the Australian Prudential Regulation Authority, the Commonwealth agency which is the prudential regulator of the Australian financial services industry, including super funds.
Refers to the Australia Post Superannuation Scheme. The APSS' Registration Number is R1056549 and ABN is 42 045 077 895.
Means Australia Post appointed and acting under a services deed entered into between the Trustee and Australia Post.
Means the Australian Securities and Investments Commission, the Commonwealth body which is responsible for enforcing and regulating company, consumer protection and financial services laws, including those which apply to superannuation.
This refers to the mix of different asset classes (and assets within each class) in an investment portfolio. Asset allocations are sometimes shown as 'strategic' (i.e. what is planned or targeted) or 'actual' (i.e. what the allocation is at a particular point in time). See our definition for Strategic Asset Allocation (SAA) for more.
This refers to a broad grouping of investments according to their expected return and risk, and whether they are traded in public or private markets. Each asset class has a different level of risk and return in the long term. Generally the greater the potential return in the long term, the greater the risk an asset class has.
Means each employer sponsor of the APSS other than Australia Post, including Australian Air Express Pty Limited (AaE) and StarTrack Retail Pty Ltd (previously known as AaE Retail Pty Ltd).
Means the Australian Taxation Office the Commonwealth body which is the Government's principal revenue collection agency, and within this role, is responsible for administering the superannuation and income tax revenue collection system.
Means the Australian Postal Corporation.
(see Concessional Contributions)
Beneficiaries include people you nominate to receive your APSS death benefit. There are different ways you can nominate your beneficiaries: 1) Binding nominations 2) Non-Binding (or Preferred) nominations and 3) Reversionary beneficiaries for an APSS Pension Account.
Means an estimate of your superannuation benefit, based on prevailing Crediting Rates for your APSS Member Savings. This can be obtained by either logging into apss.com.au or by contacting SuperPhone to obtain an estimate over the phone.
A written direction to the Trustee that sets out the dependants and/or legal personal representative you want to receive your benefit in the event of your death and the proportions payable to each beneficiary.
If your binding nomination is valid and in effect at the date of your death, the Trustee must pay your benefit in accordance with the nomination. A valid binding death benefit nomination remains in effect for three years from the date it's first signed, last amended or confirmed.
See the Choosing your Beneficiaries fact sheet for full details of who you can nominate as your beneficiary.
Bonds (also known as debt securities) are a type of financial asset that is essentially an 'I owe you' issued to investors from governments, corporations and other large institutions seeking to raise money. Investing in bonds basically involves acquiring the right to receive interest and a repayment of the original amount of the money raised by the borrower.
BPay is an electronic bill payment system that enables after tax contributions to be made to the APSS through a Financial Institution's online, mobile or telephone banking facility to organisations who are registered BPAY billers.
Any APSS member in the following categories can make an after tax (post-tax) contribution via BPay: Permanent, Non-Permanent, Rollover and Spouse.Before tax payments (i.e. salary sacrifice) contributions cannot be made via BPay.
In order to make a contribution via BPay,you will need to login to the secure section of the APSS website, select 'BPay', and obtain the Biller Code and your unique Reference Number.You can then make a contribution via your Bank or Credit Union.
The Capital Guarantee that Australia Post provides to Cash Member Savings means that the Crediting Rates and Interim Crediting Rates for Cash Member Savings cannot be negative, whatever investment markets do.
Cash in the APSS portfolio can include bank deposits, bills or securities with very high credit quality, held either directly or via a managed investment trust.
If you were a member before 1 July 2000 and you did not make average member savings of 5% p.a. to the APSS before this date, you may be yet to "catch-up" to the maximum defined benefit that you could be entitled to. Catch up only applies to permanent Australia Post employees and employees of other Associated Employers receiving a 14.3% Defined Benefit.
In relation to a member, includes an adopted child, a foster child, a ward or a child recognised as your child or your spouse's child under family law legislation.
The co-contribution is a Government initiative to help eligible individuals boost their super savings for the future. If you are a low or middle-income earner, you can take advantage of the super co-contribution payment by making eligible personal super contributions to your APSS Member Savings account.
The co-contribution payable depends on the income year in which you made your eligible personal super contributions and whether your total income falls between the super co-contribution income thresholds for that year.
For current thresholds and limits, visit ato.gov.au.
When you invest even a small amount of money - in cash, shares, property or some other type of investment - it will usually earn you interest, rent or other income over time. If you then immediately reinvest this interest or income rather than spending it, you will effectively be earning 'interest on your interest'. This means that your savings or the value of your investment grows faster. This is the principle of compounding.
The earlier you begin to save for your super, the more you can benefit from compounding. Compounding works in the same way with your super.
Investment returns are allocated to your Member Savings account or Pension Account via Crediting Rates and the amount credited remains in your account. Where Crediting Rates are positive, your super may grow even bigger over time with the help of compounding.
Concessional contributions are contributions made before tax. They include employer contributions (including the ‘Notional Taxed Contributions’ your employer is deemed to have contributed to give you a defined benefit if you are entitled to one). They include contributions you have elected to ‘salary sacriﬁce.’ Concessional contributions also include personal contributions for which you claim an income tax deduction. If your concessional contributions exceed their limit, then the excess is included in your non-concessional contributions. See our How super is taxed… fact sheet for more details including the limits that apply.
The Consumer Price Index is an economic indicator constructed to measure changes over time in the general level of prices of consumer goods and services that households acquire, use, or pay for consumption. The index aims to measure the change in consumer prices (i.e. inflation) over time.
The Crediting Rate is the rate of return allocated to Member Savings. The rates are declared fortnightly.
Before the APSS was established in 1990, employees of Australia Post had their super in the Commonwealth Superannuation Scheme (CSS).
Some employees chose to stay in the CSS, so although they're members of the APSS, they are entitled to a different benefit called the Employee Productivity Superannuation Contribution (EPSC).
The EPSC is a benefit that Australia Post must pay CSS members by law and forms part of the Superannuation Guarantee.
A Death Benefit Dependant is:
A defined benefit is a super benefit which is worked out using a formula that is usually based on your Final Average Salary (FAS) at the time the benefit becomes payable and how long you have been employed.
For example, 14.3% X FAS X years of full-time service is usually used for 14.3% Defined Benefit Members.
The APSS defined benefits are not influenced by the performance of investment markets and are therefore not affected by investment market instability.
Defined Benefits do not apply to APSS Spouse, Rollover and Pension members.
You can find a detailed explanation of how the APSS Defined Benefits are calculated in the Employee Members' Product Disclosure Statement (PDS) titled Your Defined Benefit & Member Savings. Please note that there is no PDS for CSS Members.
Means your spouse or child, or any other person who was, in the opinion of the Trustee, in any way financially dependent on you at the time of your death or with whom you had an interdependent relationship at the time of your death.
Diversification is a way of reducing the risk of low or negative returns on your investments by spreading your money across a range of different investments. A bit like the old saying, 'don't put all your eggs in one basket'. So if your super is invested in different types of assets (such as shares, property, bonds, cash, private market equity etc.) it could help offset losses if one type of investment does poorly. However, diversification does not guarantee a profit or protect against negative returns in a declining market.
The Eligible Rollover Fund (ERF) is a separate fund managed by AMP that is used by the APSS to transfer certain benefits.
Means you are a current permanent or non-permanent (either full-time or part-time) employee of Australia Post or an Associated Employer.
Opening an Employee Account can enable employee members to save more towards their retirement, in an accumulation account, in addition to their APSS Defined Benefit.
An Employee Account can accept regular before-tax contributions (salary sacrifice), after-tax contributions, rollovers from other superannuation funds, super co-contributions.
Under Australian law, superannuation entitlements can be split between divorcing or separating couples. The law allows the Courts to order the splitting of superannuation in divorce cases or couples may make their own arrangements to do so.
Financial assets are assets that have a value linked to a real asset, like a building or a business. They are a way for investors to add their money (provide capital) towards the purchase or operation of real assets without engaging directly in the management of those assets by hiring staff, finding tenants and buyers etc. In turn, financial assets give investors the right to some of the income or profits earned by real assets.
FAS is used in the calculation of APSS Defined Benefits. FAS is generally the average of the Superannuation Salaries received by an employee member on their last three birthdays in service.
Because FAS is made up of the average of Superannuation Salaries on the last three birthdays, the benefit will generally keep pace with inflation. Australia Post and Associated Employers have procedures in place that make sure that, should an employee's salary decrease, their Superannuation Salary (and, therefore, their FAS) will not decrease.
Employees who stay with Australia Post or their Associated Employer until they retire and leave service on the last working day before turning 65 years of age will have FAS calculated as the average of Superannuation Salaries on their 63rd and 64th birthdays and as at their last day of work.
A minimum level of FAS ("MinFAS") applies upon retirement at or after age 55. MinFAS will also apply to any benefit accrued during any period of probationary service and/or service as an SG Defined Benefit Member if the Member ceases service before age 55. The MinFAS is indexed on 1 July each year in line with general wage increases within Australia Post.
For 14.3% Defined Benefit Members, when calculating any APSS benefit that may be payable when a member qualifies for a Death or Total and Permanent Disablement (TPD) benefit, FAS is determined as if the member was aged 60 and their Superannuation Salary remained unchanged from the date of TPD or death to the date the member would have attained age 60.
These include shares and property. Investment returns from growth assets come from changes in the value of the shares or property that are purchased and the income received from the investment through dividends and rent. They are generally regarded as higher-risk investments but they have the expectation of higher returns over the long term.
Inflation is the increase in the price of goods and services in the economy, usually measured in terms of movements in the Consumer Price Index (CPI). Essentially what this means is that in times of rising inflation, what you can buy with $10 today will cost much more in a decade's time. For example, a litre of petrol in 2003 cost 94 cents and is today around $1.50.
These include fixed interest investments (including government and corporate bonds) and cash deposits. Investment returns from income assets are mainly from interest payments. Income assets are generally regarded as low risk investments with lower returns than growth assets.
An interdependent relationship means:
If you have a close personal relationship but don't meet the other requirements because either or both of you suffer from a disability, or you are temporarily living apart (e.g. temporarily working overseas or in gaol), your relationship may still be classified as interdependent.
When your benefit is paid, your account balance will be updated from the beginning of the previous fortnight for which a Crediting Rate has been declared using Interim Crediting Rates. If a partial payment is made, Interim Crediting Rates may be used from the beginning of the previous fortnight for the portion of the account paid out.
This is the amount of money earned by an investment over time.
(See APSS Management)
Most taxpayers pay an additional tax of 2% of their taxable income in the form of a Medicare Levy. The levy is used to fund Medicare, the scheme that gives Australian Residents access to health care.
Means an APSS member, an Employee, Spouse, Rollover or Pension Member.
This is the money that members choose to save in accumulation accounts in the APSS. These include contributions made by you to an Employee Account, a Spouse Account or a Rollover Account. These savings can also include super co-contributions and super you transfer from other funds.
Fortnightly declared Crediting Rates are used to allocate investment returns to Member Savings. Interim Crediting Rates are used when payments are made. Different Crediting Rates apply to each investment option.
(See Superannuation Guarantee top up)
The person that you have nominated in writing as the person you would prefer your benefit to be paid to in the event of your death. You can nominate one or more of your dependants and/or legal personal representative.
This nomination is not binding on the Trustee, unlike a binding nomination.
See the Choosing your Beneficiaries fact sheet for full details of who you can nominate as your beneficiary.
Non-concessional contributions are contributions made after tax. Generally, these contributions will be voluntary personal contributions you have made from after-tax salary or savings on which income tax has already been paid, and for which no income tax deduction is claimed. Unlike concessional contributions, they are generally not taxed in the superannuation fund. However, if you exceed your non-concessional contribution limit, then you may incur additional tax. If your concessional contributions exceed their limit, then the excess is included in your non-concessional contributions. See our How super is taxed… fact sheet for more details including the limits that apply.
This refers to the part of your benefit that is not subject to preservation.
For Defined Benefit members, the notional amount Australia Post or your Associated Employer contributes to provide your APSS Defined Benefit (your 'notional taxed contribution' or NTC) counts towards your concessional contributions limit, along with any salary sacrifice contributions to your Member Savings.
The Government has prescribed a standard formula to calculate this notional amount. Refer to the Employee Members' Product Disclosure Statement (PDS) titled Your Defined Benefit & Member Savings, for more information. CSS Members should call SuperPhone on 1300 360 373 for more details.
Special arrangements generally apply to employee members who had an APSS Defined Benefit on 12 May 2009 and whose notional contributions would otherwise exceed the concessional contribution limit. If eligible, their NTC is capped at the concessional contribution limit. However, salary sacrifice contributions can still cause such members to exceed their concessional contribution limit.
You may incur additional tax if the concessional contributions made to your super exceed the annual limits prescribed under legislation. Refer to the relevant APSS PDS for more information.
If you are a Defined Benefit Member, an offset account may be established for you if the APSS does not have your Tax File Number (TFN). Refer to the APSS Product Disclosure Statement (PDS) for your membership category, available from the Product disclosure section of this website for more information.
Other circumstances in which an offset account may be established for you include where:
The APSS deducts the balance of your offset accounts from your APSS benefit when it becomes payable.
A pension allows you to draw down income from your superannuation savings within certain legislated limits. Pensions provide an alternative to taking your superannuation benefit as a lump sum.
Under superannuation law, this is where the Trustee is reasonably satisfied that, because of ill health (whether physical or mental), you are unlikely to engage in gainful employment for which you are reasonably qualified by education, training or experience.
The law allows accumulation - style superannuation like APSS Allocated Pensions and Member Savings (i.e. Employee, Rollover or Spouse Account) to be transferred out of the APSS and into another complying superannuation fund at any time. This is called portability. Portability does not apply to your APSS Defined Benefit entitlements (if applicable) and may not apply to your Pre-Retirement Pension (if applicable).
Please call SuperPhone on 1300 360 373 for more information.
See definition for non-binding nominations.
Preservation refers to that part of your benefit the law requires you to keep or 'preserve' in a superannuation fund until you retire permanently from the workforce after your 'preservation age' or satisfy another condition of release.
Your preservation age depends on when you were born:
|Date of Birth||Your Preservation Age|
|Before 1 July 1960||55|
|From 1 July 1960 until 30 June 1961||56|
|From 1 July 1961 until 30 June 1962||57|
|From 1 July 1962 until 30 June 1963||58|
|From 1 July 1963 until 30 June 1964||59|
|On or after 1 July 1964||60|
Since 1 July 1999, all contributions to super funds and all interest earned on those monies are preserved.
'Private market' refers to investments in a wide range of managed funds that invest in privately-traded assets, such as unlisted companies (or private equity), infrastructure, property and commercial loans. These investments are usually locked in by long-term contracts which mean that they cannot be bought or sold readily. However, because their value is not set by trading on public markets, private market investments don't generally display much volatility over short periods.
The property that APSS invests in includes private market investment in real estate, infrastructure, private debt and similar assets. Assets include privately-traded buildings, including building developments. Infrastructure includes privately-traded assets. Private debt is money owed on a loan made by a private entity such as a bank.
'Public market' refers to investments in shares and bonds traded on public exchanges like the Australian Securities Exchange. They can be bought and sold readily and are therefore referred to as liquid. This also means that their value can change very quickly if investor demand rises or falls, a characteristic referred to as volatility.
Read 'Public Market' above and 'Shares' below.
This is the part of your APSS benefit that is non-preserved, but which you are restricted from withdrawing in cash (or transferring to the APSS Rollover) while you are employed by Australia Post or an Associated Employer.
A Reversionary Beneficiary is the person who you nominate to receive income payments from the balance of the APSS Pension in the event of your death, unless they elect to receive the balance as a lump sum.
A Reversionary Beneficiary must be your: Spouse; Child aged under 18 (exceptions apply if they are between 18 and 25 and still financially dependent on you, or are over 18 and permanently disabled); any other person with whom you had an Interdependent Relationship; or any other person who was financially dependent on you when you died.
The transfer of superannuation from one superannuation fund to another is called a rollover. Members can choose to rollover your superannuation from other complying superannuation funds to the APSS, or rollover their Member Savings to another complying superannuation fund.
The APSS Rollover Account enables employee members to retain their superannuation in an accumulation account in the APSS after the member ceases employment with Australia Post or an Associated Employer. It is also available to Spouse Account members whose spouse has ceased to meet the definition of 'spouse' or whose spouse (the employee member) has ceased employment with Australia Post or an Associated Employer.
Means Superannuation Fund Number. The SFN for the APSS is 160 463 945. This number may be requested, along with our ABN by another super fund if you're transferring money out of that fund and into the APSS.
The other fund may also request a "SPIN". If this is requested, then just use your APS or APSS number.
Shares (also known as equity or equities) are public market financial assets that assign ownership of companies to investors, giving them an interest in the management of the company. Ownership of shares in a company entitles investors to their proportional 'share' of the company's profits. The company's profits may be distributed to shareholders in the form of dividends or invested back into the company to increase its future profits.
Means Superannuation Product Identification Number and may be requested, along with our ABN, SFN and USI by another super fund if your transferring money out of that fund and into the APSS. If a SPIN is requested, just use your APS or APSS number.
Your spouse is:
An APSS Spouse Account is available for spouses of employee members to establish an accumulation account in the APSS. Once established, the spouse member may make after-tax contributions, contributions for which the spouse may claim a tax deduction (if self-employed), rollover super from other superannuation funds and may be eligible for super co-contributions.
The Standard Risk Measure is a measure based on industry guidance to allow Members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20 year period.
This refers to the investment strategy that determines the mix of different asset classes (and assets within each class) in an investment portfolio. Asset allocations at a particular point in time might vary from the SAA, but only within allowable ranges that are set as part of the overall investment strategy. That's why you might sometimes see a difference between the SAA used for our investment strategy and the actual allocation at, for example, the end of a quarter, as published in the Insight newsletter for members.
This is the defined benefit accrual rate for APSS members with SG Defined Benefit (formerly known as '9% Defined Benefit') entitlements. The SG Accrual Rate is in line with the rate prescribed under the Superannuation Guarantee legislation (refer below).
This is the minimum amount of superannuation that employers have to provide for their employees to satisfy their obligations under SG legislation. This minimum amount of superannuation has steadily increased over the years, and is scheduled to increase to 12.0% on 1 July 2025 from the current rate of 9.5%:
|1 July 1992 - 31 December 1992||4.0%|
|1 January 1993 - 30 June 1995||5.0%|
|1 July 1995 - 30 June 1998||6.0%|
|1 July 1998 - 30 June 2000||7.0%|
|1 July 2000 - 30 June 2002||8.0%|
|1 July 2002 - 30 June 2013||9.0%|
|1 July 2013 - 30 June 2014||9.25%|
|1 July 2014 - 30 June 2021 (CURRENT SG)||9.5%|
|1 July 2021 - 30 June 2022||10.0%*|
|1 July 2022 - 30 June 2023||10.5%*|
|1 July 2023 - 30 June 2024||11.0%*|
|1 July 2024 - 30 June 2025||11.5%*|
|From 1 July 2025||12.0%*|
If you are a Defined Benefit Member, to ensure that your APSS benefit always meets the minimum SG requirements, a Superannuation Guarantee top up may be calculated for you. This is the amount by which the minimum SG benefit exceeds your Defined Benefit.
The minimum SG benefit is also referred to as the Minimum Requisite Benefit (MRB). If you are entitled to a Superannuation Guarantee top up, it can go up or down when your Defined Benefit changes and when the minimum SG changes.
This is relevant for Defined Benefit Members who are employees of Australia Post or an Associated Employer.
Superannuation Salary is generally your full-time equivalent salary, before tax, including recognised allowances, as at your last birthday.
If you were not a member on your last birthday, your Superannuation Salary is simply your before-tax salary as at the date you joined the APSS. Salary sacrificing does not affect your Superannuation Salary.
Your Superannuation Salary is based on payroll information provided by Australia Post or your Associated Employer. In the case of a part-time employee, full-time equivalent Superannuation Salary means the salary that would have applied had the employee worked in full-time service.
The Government's Surcharge Tax was abolished from 1 July 2005, but may still apply to some accounts in respect of earlier financial years.
In the 2004-2005 financial year, the Surcharge Tax was a tax of up to 12.5% on certain super money, including salary sacrifice contributions and what Australia Post or Associated Employers were deemed by law to have contributed to fund their employees' Defined Benefit ('surchargeable contributions'). Surcharge Tax was payable in addition to any tax ordinarily payable by the APSS on contributions.
Your APSS benefit may be affected by surcharge if these surchargeable contributions, plus your other income and reportable fringe benefits exceeded the surcharge threshold (i.e. $99,710 in 2004/05). Surcharge Tax may also have applied if you have not provided the APSS with your Tax File Number.
A Surcharge Tax Account may be established for you where the APSS has been required to pay a surcharge tax liability to the ATO from your Defined Benefit. The surcharge tax amount will accrue with interest at the 10- Year Commonwealth Government Bond rate. The APSS will deduct the balance of your Surcharge Tax Account from your APSS benefit when it becomes payable.
While surcharge tax was abolished from 1 July 2005, surcharge assessments from earlier financial years may still be outstanding.
Under superannuation law, this is where:
TPD benefits are not payable to all APSS membership categories - currently only to Employee Members and, from 26 June 2017, to eligible members who have a Spouse or Rollover account.Employee Members
TPD is not the same as permanent incapacity, which is defined in superannuation legislation. If your membership category covers you for TPD, the following definition, from the APSS Trust Deed, would be used to assess any claim for a TPD benefit payment:
TPD is defined under the Trust Deed as follows:(1) If you last became an APSS member on or before 30 June 2014
Ill-health (whether physical or mental) where the Trustee is reasonably satisfied that the member is unlikely, because of ill-health, to engage in gainful employment for which the member is reasonably qualified by education, training or experience.
The above definitions are subject to the proviso that (unless Australia Post otherwise determines, either generally or in any particular case), TPD shall not include disablement as a result of illness or injury which in the opinion of the Claims Assessor (or the Trustee, if there is no Claims Assessor) has been inflicted, incurred or aggravated for the purposes of obtaining a benefit under the APSS. The Claims Assessor is a specialist claims assessment person appointed by the Trustee, with the approval of Australia Post, under the Trust Deed.Members with a Spouse Account or Rollover Account
From 26 June 2017, eligible Spouse and Rollover members will, for the first time, automatically receive an amount of insurance cover for death, TPD or terminal illness, with the flexibility to either apply for more cover, or cancel it by opting out.
This cover is separate to any Death and TPD benefit you're entitled to if you are an Employee Member (see above).
There's more information in a fact sheet we've prepared called Insurance cover for Spouse and Rollover members.
Transaction costs are costs such as brokerage, settlement costs, clearing costs and stamp duty when the investments of the APSS are bought or sold. These expenses are in addition to the management costs and are deducted from the assets of the relevant APSS investment portfolio before the Crediting Rates are determined.
These are the principal governing rules of the APSS.
The Trustee is the legal entity responsible for operating a superannuation fund.
Your Trustee is required to act in good faith and in the best interests of members, and operate in accordance with the APSS Trust Deed and relevant legislation.
The Trustee is PostSuper Pty Limited (ABN 85 064 225 841, Registrable Superannuation Entity (RSE) Licence Number L0002714) a company established specifically for the purpose of acting as the Trustee of the APSS. Note the APSS' Registration Number is R1056549 and ABN is 42 045 077 895.
This refers to the part of your benefit that is not subject to preservation and may be accessed at any time.
Means the Unique Superannuation Identifier and is used to identify a superannuation fund's products and/or channel. The APSS's USI is 42045077895001. The APSS Pension has a different USI, which ends in a '2' as follows 42045077895002.
When investing, volatility is a measure of risk that refers to the extent to which investments rise and fall in value over a specific period of time. The more the value of the asset fluctuates (goes up and down) over time, the more volatile it is considered to be.
Historically the most volatile asset classes have been shares and property while the least volatile assets have generally been bonds and cash. In general, asset classes like shares are regarded as more volatile, higher risk investments, but have the expectation of higher returns over the long term compared to lower risk investments like bonds and cash.