In Control of Your Future: Why More Australians Are Choosing SMSFs

Take Charge of Your Investments

Ever dreamed of steering your own retirement savings? With a Self-Managed Superannuation Fund (SMSF), you’re in the driver’s seat. As a member, you get to choose how your super is invested and how you’d like it paid out when you retire. From your investment strategy to day-to-day choices, the control is all yours.

More Ways to Invest

SMSFs open up a world of options you might not get elsewhere. Want to put your money into managed funds, listed shares, or even a quirky collectable like rare coins or artwork? Go for it. You can even invest in property, residential or business, plus some unlisted shares. The point is, you design your portfolio your way.

One Fund, the Whole Family

Did you know an SMSF can have up to six members? That means your fund could be a family affair. Managing everyone’s super in a single fund can give you more flexibility, especially if you need to sell assets to pay a death benefit for a member. Everything’s under one roof.

Borrowing for Bigger Investments

Maybe you don’t have enough in the fund to buy that dream property or a large parcel of shares outright. That’s okay, SMSFs can borrow using limited recourse borrowing arrangements. This lets you make bigger investments than you could with just your available cash.

Tax: Timing Is Everything

With an SMSF, you can have a say in the timing of certain tax events, like when to realise gains or losses on assets. Plus, you can make ‘in specie’ contributions—transferring assets directly into your fund—where your investment earnings could be taxed at a concessional rate. It’s all about managing your tax in the smartest way possible.

Estate Planning: Certainty and Flexibility

With an SMSF, you get to decide who receives your super if something happens to you. The trust deed can spell out exactly how and to whom death benefits are paid out—so long as it fits within the rules. That means more reassurance for you, and for your loved ones.

Is an SMSF Right for You?

What to Think About Before Diving In

  •        How much do you need to start? The balance you’re starting with matters. A lower balance could work if you’re willing to handle much of the admin and make a substantial contribution to the fund.
  •        Do you have the time and know-how? Every SMSF member is a trustee (or a director of the corporate trustee), so everyone’s on the hook for running the fund and meeting all legal and admin obligations. Be honest, do you have the time, skills, and knowledge?
  •        Who can be a trustee? Most people can, provided they’re not an employee of another trustee (unless they’re related) and aren’t a ‘disqualified person’. That includes anyone disqualified by the ATO or APRA, undischarged bankrupts, or anyone convicted of a dishonest offence like fraud.
  •        Would a regular super fund suit you better? Publicly available super funds (like retail and industry funds) offer plenty of investment options and no trustee headaches. Sometimes, less responsibility is a good thing!

How to Set Up an SMSF: The 10 Key Steps

  • .Choose your trustee structure: Will you all be individual trustees, or set up a corporate trustee?
  • .Get a trust deed: This legal document sets out the rules for your fund, alongside super laws, and governs how everything operates.
  • .Sign trustee declarations: All new trustees need to sign a declaration within 21 days, acknowledging they understand the rules and responsibilities.
  • .Record members’ TFNs: You’ll need to keep a record of each member’s Tax File Number.
  • .Register with the ATO: Register your fund within 60 days of being set up and elect for it to be regulated. Fill out the ‘Application for ABN registration for superannuation entities’ (NAT 2944) from the ATO website.
  • .Open a bank account: This account will accept contributions, receive investment income, pay expenses, and distribute benefits. The account must be in the names of the trustees and kept separate from any personal or business accounts. Don’t forget to notify the ATO of the account details.
  • .Prepare an investment strategy: Consider the needs and circumstances of every member before making investments.
  • .Accept contributions and rollovers: You’ll need an electronic service address to handle these.
  • .Appoint professionals: An independent auditor is a must. They’ll review the fund’s activities every year and ensure compliance with the law.
  • 0  Plan for the future: Members should make a death benefit nomination so their super is paid as they wish. Also, have an exit strategy in case the SMSF ever needs to be wound up.

Crafting Your Investment Strategy

When drawing up and reviewing your fund’s investment strategy, keep these six steps in mind:

  •        Assess your fund’s situation
  •        Set a clear investment objective
  •        Develop your investment strategy
  •        Consider insurance for fund members
  •        Put the strategy into action
  •        Review and update the strategy as needed

Need More Information?

For answers to your specific questions book your appointment in the new year https://www.unfairadvantage.com.au/existing-client-booking/