When so much is up in the air, as it is now, people long for certainty. Investment markets are challenging and super earnings weak. That may prompt some people to consider setting up a self-managed super fund to take more control of their super.
According to the Australian Taxation Office, SMSFs have grown massively over the past two decades and now number 600,000. They make up a third of Australia’s total retirement savings – $748 billion – and serve 1.125 million members.
Adrian Raftery, who has researched SMSFs extensively and is the principal of Mr Taxman, says SMSFs can be advantageous: they provide greater investment choices, including direct property, as well as tax and estate planning benefits.
“There are a lot of members who buy commercial property because they can run their own business out of that,” he says.
But he is quick to point out SMSFs are not for everyone.
The amount of people closing them down is rising, he says.
“Overall, the total number of SMSFs is still rising each year but the rate of growth has declined because of the numbers of SMSFs closing down.”
One of the main issues is the cost and time involved in running an SMSF. Aside from managing the investments (the fund can have up to four members) there are many administrative and compliance requirements that need to be dealt with.
That means you will need to call on the help of professionals such as solicitors, accountants and financial advisers at different times. Crucially, you need to do the sums to work out whether the exercise justifies the expense.
Diese Geschichte stammt aus der July 2020-Ausgabe von Money Magazine Australia.
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Diese Geschichte stammt aus der July 2020-Ausgabe von Money Magazine Australia.
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