If you are like the majority of this country, you have not paid much attention to your superannuation, you have multiple accounts all charging fees and you have little to no idea how it is invested.
Did you know that with the right advice, you are able to run your own super fund (called a Self-Managed Super Fund or SMSF) and invest in vintage cars, residential property, commercial property, gold or silver bullions, artwork.. the list goes on.
You don’t have to be an expert in super, or investing, or even be particularly fond of paperwork. There are rules that you need to comply with, but with the Adviser, it really is quite a straightforward process. And that is our speciality.
Over 900,000 Australians run their own SMSF and it receives a lot of attention in the media. So you probably have some burning questions.
Well… here are the FACTS:
Why do people set up their own SMSF?
To invest in assets you can touch and feel
To take control over their financial future
To make their own decisions about what to invest in
To have a more hands on approach with their retirement
To start building a property portfolio now (business premises or residential).
What investments can my SMSF purchase?
There are specific rules about what you can invest in, so it’s important you seek our advice before you make any decisions. Typical investments include:
Residential and Commercial Property
Shares & Managed Funds
Cash & Term Deposits
Gold & Silver Buillions
Is it expensive to set up a SMSF?
No, it isn’t. but will have one-off legal fees to establish the fund. You need a SMSF Trust Deed (the document that contains all of the rules for running your super fund) and we will typically incorporate a Company, of which you will be the Director, to be the Trustee (the decision maker- ultimately you will have full control). There are many options, and we will talk about how to best structure the fund for your family's circumstances.
Set up costs are paid for by your Superannuation - NO OUT OF POCKET COSTS...
This is your financial future we are talking about here, so the cost is incomparable to the opportunities available using this vehicle for investment.
How much super do I need to set up a SMSF?
Some news stories suggest you need at least $200,000 to make it cost effective to have a SMSF. We disagree. SMSF are an excellent vehicle for your families wealth creation, allowing for you and your spouse to combine your superannuation balances. Even if you have as little as $100,000 combined in super right now, it may make sense to establish a SMSF in order to set up life insurance while you are still fit and healthy. We also assist many of our clients to utilise their SMSF for effective Estate Planning strategies such as:
Ensuring your family's wealth stays in your bloodline
Protecting your childrens interests in blended family situations
It is really all about YOUR strategy. We will be able to tell you if you have enough superannuation for your personal circumstances.
It is all about strategy....
A tried and tested strategy might include utilising your super as a deposit to purchase a residential investment property. To illustrate, you might have $100,000 in super and you might like to purchase a property valued at $400,000. Your SMSF would take out a loan with a bank (using a borrowing arrangement) for the remaining $300,000. The rental income, along with yours and your spouses superannuation contributions, can pay off the loan as quickly as you would like. Many of our clients like to see their super fund growing at a capital growth rate of 5% on an asset of $400,000 rather than their initial $100,000. This is why many people consider a borrowing arrangement for a SMSF. Start your portfolio now to ensure you have a number of properties in your super fund to provide you with a TAX-FREE passive income in retirement. Of course, we believe in diversification, however many of our clients are comfortable with the property market, as they understand the value of bricks and mortar.
Is an SMSF right for you?
It's not for everyone. It’s important you get the right advice to see if it's the best option for you and your family...
Come in for a complimentary meeting with one of our Accountants.