Robson Chartered Accountants Business & Finanical Advisors - Gosford - Central Coast - NSW

More Australians take back control of super

 More and more Australians are choosing to take control of their super within self managed super funds says David Evers from local accounting and financial advice firm Robson Partners.

About one quarter of all superannuation in Australia is held in Self Managed Super Funds – in December 2009 this reached $384 billion according to the Australian Prudential Regulation Authority.

David Evers says, “Some people call it a ‘DIY Super Fund,’ and as the name suggests it is a superannuation fund that you set up and manage yourself.”

Unlike an employer or retail super fund, you are responsible for investing the funds and managing the administration.

 “But like any other super fund, you generally cannot access the money until retirement,” says David Evers.

“A self managed super fund offers flexibility and investment choice for those who have the time and resources and can also be beneficial for family members who want to manage, control and pool their retirement savings.”

How does a SMSF work?

• The fund must have less than five members, but of course may have just one. Each member must also be what is called a “Trustee”.
• Usually an accountant and financial adviser will assist in the set up and administration of your fund.

What are the benefits of a SMSF?

• David Evers says, “As a SMSF Member you get more control over how your funds are invested. If you have a strong interest in investing and have the time to manage it, this can be a great way to grow your retirement savings. 
• SMSFs also offer the opportunity to invest in assets and asset classes that may not be available in other super funds, such as direct shares and properties.”SMSFs may have lower and fewer fees than a professionally managed super fund, so costs might be minimised this way. However, this will depend on how big your fund is and how many members are involved.
•  In some cases, SMSFs may offer asset protection.  For example, in the case of bankruptcy –  such as a small business owner – if the business goes bankrupt, the assets in their self-managed super fund are usually protected.

 What are the drawbacks to managing your own super?  

• It’s important to remember that any super fund has to comply with a variety of Australian laws and Trustees face penalties if they don’t meet these laws. “Keep in mind that anyone considering a SMSF will need to have good knowledge of these laws so that everything runs smoothly,” says David Evers.
• Having investment choice can be great for some, but not everyone has the necessary experience and industry knowledge to run their own super fund.  In many cases, advice is often sought through a financial adviser and an accountant may also be involved in the set up and administration. 
•  And of course you need time, money, and lots of self-discipline to keep up with administration costs, trustee meetings, investment research and keeping up to date with the super industry.
• “If you are considering running your own super fund, you should seek advice first about what is involved and if it is suitable for you.  We are more than happy to help with this and offer advice on investment choice within a SMSF,” says David Evers.

Of course information we’ve talked about today is just general advice.  Each person’s situation will be different depending on what stage in life they’re at, so before acting on these general tips, seek advice about whether it’s appropriate in light of your own objectives, financial situation and needs.   At Robson Partners we can help you decide the best strategy…

Robson Partners is an Authorised Representatives of Count Financial Limited. David Evers is an Authorised Representative of Count Financial Limited, AFS Licence number 227232.