Benefits of Setting up A Self-Managed Super Fund

Why should you set up a self-managed super fund instead of going with a retail or industry pension fund? Well, there are three main advantages to a self-managed super fund: cost, freedom, and control.

Cost

The costs for running your personal superannuation fund tend to be typically fixed and are not dependent on the entire amount of assets you have. Other superannuation funds typically charge a percentage of assets as their fees; therefore, your higher account balance the more you pay.

Thus, when your retirement funds/assets exceed a certain amount, a self-managed super fund would offer additional cost benefits. And if you have other members in your super fund, you can bundle your funds and share the fixed costs. By the way, a higher balance in your fund will also allow you to better diversify your investments and get a better effect on borrowing for investments.

For example, if you have $ 300,000 in a self-managed super fund and the cost per year is $ 3,000, the fixed cost is 1% of your fund balance. However, if you have another member in the fund that also has $ 300,000 (a total of $ 600,000 in the fund) in his retirement pension, the fixed cost is 0.5% of the total fund balance.

Freedom

A self-managed super fund gives you the freedom and flexibility when it comes to a range of vital decisions such as how benefits can be paid to members when they retire or how death benefits are paid in case death of a member.

You will also have the option of charging your fund in assets instead of cash.

Control

Just like its name, a self-managed super fund is self-managed, so it allows you to control decisions made in the Superfund. You have the power to choose and develop an investment strategy tailored to your needs and to have a direct sense in all investment decisions.

You will have access to a wider choice of investment options such as real estate, quoted shares, corporate bonds and also managed investments. You will also be able to buy or sell own investments while other retirement funds do not provide this service.

There is also the option for you to borrow in your self-managed super fund to give you leverage for some investments. As mentioned earlier, a larger fund balance will allow you to better diversify your investments and provide you access to certain investments that require a high balance, such as commercial properties.

A self-managed super fund will also allow you to efficiently plan and structure certain tax events that are not available in a public offering fund.

There is a range of benefits that a self-managed super fund can offer. However, it is not suitable for everyone – and if you do not know the investment strategies and tax laws of retirement, it is highly recommended to seek professional advice from a financial planner before setting up your own self-managed super fund. http://www.smsfselfmanagedsuperfund.com.au

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Student Life; Living on a Budget

It should come as no surprise that student life comes with a number of challenges, many of them finance related. And while Hollywood would have you believe that all students live on nothing but microwave noodles and soda, the reality of the situation can be very different if you just follow a few tips and tricks, like the ones below.

Get a Job on Campus
This tips isn’t just tellin you to look for a job, but to look for a job on campus. There are two main reasons for this. visit this link here!

A workplace on campus is likely to be more flexible with your working schedule when it comes to exam times, often allowing for more leave that a regular employer.

An on-campus employers not only means that you will receive discounts at the employer you work for, but are also likely to be eligible for other discounts around campus at a range of stores you will regularly visit for your school supplies.

On the Subject of Discounts
Speaking of discounts, don’t discount the power of your student I.D. More stores than you would expect are happy to offer you a student discount. Whether it’s a free upgrade, a free beverage, or you save money by buying your books from the Groupon Coupons page for Barnes & Noble, every discount adds up to make your student life easier and more affordable

Why Does It Have to Be New?
If you don’t have a real answer to that question then whatever you are buying doesn’t need to be new, and can be purchased for significantly less from a thrift store without any of your classmates having any idea.

Student LifeItems like clothing and school supplies can be found on various social networking groups for cheap. The way this works is that students who recently graduated are willing to sell their supplies for a reduced price, just to get rid of them. Many of the items, such as some of the textbooks, may not have even been used.

Get Together With Your Dorm Friends
One of the best ways to save money on your food budget is to buy in bulk. The challenge for a student, however, is that they aren’t able to take advantage of these offers because the products expire before they have a chance to consume them. get full details from http://www.smsfselfmanagedsuperfund.com.au

However, if you were to get 5-10 of your friends together to make a bulk purchase, each of you can enjoy the benefits of bulk buying without wasting any food. If you take a look through your local warehouse store catalogs you will need a number of items that each of you will need to buy at one stage and one which you can all save money on.

When it comes to living on a student budget, you may not be able to live a glamorous life, but you can at least live a happy and healthy one throughout your college years to keep your brain and your body fueled and ready to learn!

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Thinking about self-managed super

There’s been much buzz around self-managed super funds, but what are they all about? Many people are weighing up their options and now more than ever are considering taking control of the biggest asset they have (besides their home).

Here we discover the key factors that are making self-managed super fund so attractive.

Reduce Your Super Fees

When it comes down to it, nobody likes paying for anything when they don’t have to. Many corporate, industry or retail super funds charge their fees based on how much you have in your superannuation fund and are calculated as a percentage, not a flat fee. Therefore, as your super grows, you’ll be charged more!

An SMSF does away with all of the percentage calculations and allows you to pay a flat fee, which doesn’t increase as your fund gets bigger. So when you add it up, think of the money that you could save with a self-managed superannuation fund on fees alone.

Maximise Your Returns

Aside from the money you’ll be saving on fees a SMSF will allow you to maximise your returns by splitting up where you invest your money. You can invest in shares, managed funds, residential properties, cash and fixed interest in whichever proportions you think are appropriate for you. By having this control, when a market dips you can act upon this by shifting your assets elsewhere.

With a company, industry or retail run super fund, you are exposed to their particular strategy which limits your opportunity for returns.

Reducing Your Tax with Salary Sacrifice

Salary sacrifice is simply an agreement you make with your employer to pay part of your pre-tax income into your self-managed superannuation fund.

  • The raw dollar advantage in choosing to salary sacrifice is that the contributions put into your SMSF are not taxed in your name but your SMSF at 15%.
  • So, if your personal tax rate is more than 15%, there is a tax benefit in salary sacrificing. If you sit at the top tax rate of 46.50% you can save up to 31.50% on each dollar you salary sacrifice into your SMSF.

By doing this, you can add thousands of dollars in tax benefits annually. Click here !

Claiming Benefits – Claim Co-Contribution

The Australian government has set up a scheme which matches dollar for dollar the additional contributions one makes to their superannuation. Although the government’s contributions are capped at a certain amount, there is still great opportunity to add to your SMSF balance. Many reputable companies who assist with setting up a self-managed superannuation fund will have all the relevant paper work for you to apply for this scheme.

Finally, be advised that you cannot access SMSF money for purposes other than your retirement needs. SMSF funds are bound by the sole purpose test, which says that superannuation investments are meant only to provide retirement benefits for the trustee(s).

Conclusion

While it is our duty to secure our financial future through prudence and alertness, it pays to remember the other durable values of life. As the great philosopher Bertrand Russell said, “The most valuable things in life are not measured in monetary terms. The really important things are not houses and lands, stocks and bonds, automobiles and real state, but friendships, trust, confidence, empathy, mercy, love and faith.”

This explains why the reason why the government gives a tax break for the income from self-managed super. Visit this site for more information : http://www.smsfselfmanagedsuperfund.com.au

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