SPECIALIST ADVICE | Self Managed Super Fund (SMSF)

Self-managed super funds (SMSFs) have become increasingly popular in recent years. They are often called ‘do-it-yourself’ or DIY super funds and, as their name suggests, they are super funds that are managed by their members.

SMSF’s provide you with more flexibility and choice in the type of assets you can invest your super in. This is because they allow you to hold some assets that many other superannuation vehicles usually don’t allow you to hold, such as collectables, unlisted shares and property.

Another advantage offered by SMSFs is transparency. They enable you to better understand where and how your money is invested. So if, for instance, ethical investing is important to you, you can ensure that your super assets do not include investments in, say, fossil fuels, tobacco or products tested on animals.

SMSFs also come with many risks and disadvantages. SMSF trustees have strict duties, responsibilities and obligations. Trustees are also required to prepare an investment strategy for the SMSF and to make investment decisions in line with that strategy. In addition to ensuring an approved SMSF auditor is appointed on a regular basis, trustees must complete administration tasks such as lodging annual returns and record keeping.

With all this in mind, perhaps it might be a good idea to speak to a professional adviser to determine whether an SMSF is right for you, or whether there are better options to help you grow your retirement nest egg.