Talk to a planner about... Self Managed Super Funds (SMSFs)
SMSFs are now very popular, have been heavily marketed and are the "flavour of the month". Are they suitable for everyone? Definitely not!
Why set up a self managed super fund?
The right reasons
- interested
- want to be more involved
- gain economies of scale
- greater transparency
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The wrong reasons
- disenchanted with managed super funds
- save money on fees
- want to speculate or "play the market"
- "accountant told me to"
- don’t trust financial advisers
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SMSFs can provide investors with the freedom to become more closely involved in the management of their super as well as the ability to have a tailor made portfolio that is specific to their needs.
SMSFs can also provide a high degree of transparency so investors can see where their money is invested and more easily understand why the value of their fund is going up or down.
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Some investors have become disenchanted with self managed super for the following reasons;
- they did not receive sound investment advice,
- the returns were less than managed funds,
- it was more expensive than they expected,
- they grew tired of the record keeping and trustee responsibilities.
It is disappointing when new clients come to us with self managed super funds that have been under utilized. Typically they are sitting on large amounts of cash, or have a mish mash of investments that look like they were bought at a jumble sale.
The real advantage of running a SMSF is the freedom to build a portfolio of investments that reflects your individual needs and objectives. A fund that has a large cash balance probably represents an opportunity wasted.
At Wakefield Partners we have helped many of our clients establish SMSFs. We help them through the process so that they can be confident (as trustees) that the fund is correctly administered.
This includes formulating a written investment strategy which details the proposed asset allocation and types of investment that are appropriate given the age and objectives of the members.
If you would like a copy of the RBS Morgans Trustees Guide to SMSFs please contact us at Wakefield Partners on 08 8333 2488 or
via email.