Self-Managed Super Funds (SMSF)

Considering a Self-Managed Super Fund (SMSF)?

A Self-managed super fund or more commonly called SMSF is as the name suggests, a Superannuation fund that is self-managed by the members of the fund.
The fund can have up to 6 members and is able to invest in the following investments:

  • Managed funds
  • Commercial property
  • Residential property
  • Exchange-traded funds (ETF’s)
  • Term deposits
  • Cash
  • Collectibles

Advantages of a Self-Managed Super Fund

  • Complete control over where you want to invest your money
  • The degree of flexibility where you can invest. You can choose from assets including, bonds, shares, commercial or residential, and collectibles, among other things.
  • SMSF money benefits those who survive you.
  • There are tax concessions to be had. The deferral of capital gains tax in the pension phase.
  • Self-managed super funds can run simultaneously in the pension phase and the accumulation phase.

Disadvantages of a Self-Managed Super Fund

  • The annual fee structure and consultancy charges pertaining to SMSF management can make it more costly to run when compared to your retail or industry fund.
  • Being outside prudential regulations, you do not have access to the Superannuation Complaints Tribunal.
  • The management of affairs lies with you and the other trustees, so you have to be completely up to date with the legislative and legal changes & the penalties for non-compliance.
  • Risk of poor diversification e.g., if they are established specifically to buy a single asset such as residential property.
  • Risk of losing interest. Funds may not have performed to your expectations.

Need More Information?

If you are considering a self-managed super fund for your retirement, don’t hesitate to get in touch if you have any questions.