When should you start your Self Managed Super Fund?


Self-managed super funds (SMSFs) have grown enormously in popularity over the last 5-7 years.

Because people like to be able to control their income rather than have a fund manager do it for them.

Managing your own super also allows you access to a wider ranger of investment options, such as shares, direct property investment, and other asset classes that are not available to conventional super funds.

At Option Mortgages, we DO find that most people are creating a SMSF simply to invest in property.

And that makes perfect sense. As an asset class, property has outperformed everything else (when you consider relative risk and leverage) over the last 100+ years. It’s Australia’s asset class of choice.

And now, with SMSF rules allowing you to invest your super directly into property — subject to certain regulations — it makes a lot more sense for a lot of people.

However, SMSFs do incur some fees to run. So there’s generally a break even point where it becomes worthwhile. And where that break even point is, can often depend on your own, individual circumstances.

When deciding whether an SMSF is right for you, there are a few steps to follow:

Get professional advice – this is vital, to makes that you are fully compliant, and also to guide you towards appropriate investment decisions. Our friends over at Option Wealth Solutions [link to appropriate OWS page] can help you with this.

Make sure your balance is sufficient and that you have enough to ensure your SMSF runs in profit. Make sure the gains you make aren’t eaten up by the fees you pay to run an SMSF.

Understand the regulations so you know what you can and cannot invest in. (You may be surprised at just how many different investment options become available once you create your SMSF.)

Make sure you have a good accountant who can work through your record-keeping, reporting, and auditing obligations — these all sound like complex requirements, but it really is bread and butter to any decent accountant.

Once you have your SMSF established, which can take up to two months, you’re ready to take control of your own money and invest.

And if you’re interested in using your SMSF to invest in property, we really need to hear from you to make sure everything is set up correctly. There are certain property types that are not available within your SMSF, and some important rules to follow.

Call 1300 848 848 now.


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