What is a self-managed super fund?

Put simply, self-managed super funds (SMSFs) are private super funds that you manage yourself. SMSFs are different to industry or retail super funds in that their members are usually the trustees as well. While this means that you get to choose the investments and the insurance, it also means you have to make sure the fund complies with super and tax laws. There’s a lot of work involved and risk to manage. That’s why it’s so important to seek expert advice when setting up and running an SMSF.

Why should I consider an SMSF?

Over 52 SMSFs are established every day in Australia. At the end of the last financial year, there were 1,107,268 members of SMSFs, spread across 593,375 funds[1]. They’re popular, and they are no longer solely the domain of the very wealthy.

There are several reasons why more people are opting for SMSFs over industry or retail super funds. The main reason is control and transparency. When you manage your fund, you get to choose where the money goes. You have control over your assets and investment decisions, which allows you to put in place tax strategies that benefit you.

There’s also choice. Within an SMSF, there’s the opportunity to invest in asset classes not available within an industry or retail super fund – such as residential property. In other words, you can use your super money to invest in property.

The possibility of paying lower fees is also a drawcard. Some industry and retail super funds charge fees based on a percentage of assets, whereas SMSF fees tend to remain around the same level regardless of your balance.

These are just a few reasons why some opt for SMSFs. To find out if this is a path worth exploring for you, get in touch with us today.

Why should I seek expert advice?

As the proverb states, with greater power comes greater responsibility. You now have control over where your money is invested, but do you have the knowledge and expertise to make the right calls? Are you up to date with the rules and regulations regarding SMSFs? Can you keep your account compliant?

See how Pride Advice can help you make the most of your SMSF (link to SMSF Advice page).


[1] ATO SMSF quarterly statistical report – September 2020