What You Need To Know Before Setting Up A Self-Managed Super Fund (SMSF)

I believe that Self-Managed Super Funds are fantastic vehicles for building wealth, protecting assets, saving taxes and taking care of your family when you die. But they are not for everyone. This article will analyze the reasons why someone just should not have an SMSF. While reading, examine your personal motivations for having an SMSF or wanting to establish one.

To Death Do Us Part

An SMSF is like a marriage: it takes a momentous commitment and a little hard work when it is necessary for it to work without problems. When you are the type of person who does not like to commit to long-term things, then it is likely that an SMSF is not for you. Be honest with yourself and see your history. Whether you have before jumped between various jobs, companies or even countries, there is a possibility that an SMSF is not for you. You will have regular financial and time commitments to work effectively with an SMSF.

Jump on the Bandwagon

I have seen many people who have attended the last weekend investment seminar and get caught up in advertising, whether in the exchange of stocks, options, CFDs, FOREX/ currency trading or property. On Monday morning, they are calling their accountant to set up an SMSF. If you see your current retirement savings as money that you can simply access to start trading now and make millions tomorrow, you are likely to end up disappointed and keep an empty SMSF.

When it comes to any kind of investment, you must educate yourself. Unluckily for most people, the education system and their education do not give them with a financial education. You must learn to walk before you can run. This means starting with your own money and if you do it right, gradually increases your commitment as you grow your knowledge and experience. Do not extract $ 25k, $ 50k or $ 100k from your current superfund, think you know everything there is to know and use it to invest in the ultimate flavor of the monthly investment.

Who Stole the Cookies?

An SMSF is excellent if you want to take control of your financial future by vigorously managing your investments under a well-considered long-term investment plan. An SMSF is not so good if you are the kind of person who cannot resist stealing cookies from the cookie container. You must be honest with yourself. Whether you have previously entered into your savings account to buy an item you must have, then it is likely that with the prospectively essential amount of funds available in your SMSF.

If you intentionally set up an SMSF for early access to your retirement savings before your retirement, then an SMSF is not for you. Unless you enjoy fines of up to $ 225 k and up to five years in jail. If it ever occurred to you to think about using your retirement savings for anything other than your retirement, then an SMSF is definitely not for you.


A Self-Managed Super Fund is a great vehicle for your wealth, but you need to make sure you are establishing one for the right reasons. Take your time, educate yourself, and talk to other people with SMSF and talk to your financial advisor or accountant.

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What Are The Financial Risks Of A Self Managed Super Fund (SMSF)?

Self managed super funds really have become a vastly popular avenue for many investors today. These super funds are not only popular to those who want to retire early but for those who want to put some extra money aside for when they are in their golden years. However, while there are many good reasons as to why you should choose these funds, it’s still very important to understand and know the potential risks of SMSF’s. Read on to find out more.

Self Managed Superannuation Funds Can Result In Taking a Loss

As with any investment, you can lose money. Just because they have a fancier name, that doesn’t mean to say the super funds can’t lose you money nonetheless. Self managed super funds are great but again, you still have a great financial risk. You might think there is limited risk but again, it’s not exactly the case. There are always going to be risks involved when it comes to super funds. While most people are a little more cautious when investing today there are no guarantees. Learn more.

Lots of Time Is Needed

Another drawback of these funds has to be the fact that they can be very time consuming. When you are dealing with a SMSF, they do take a lot of time and patience to deal with simply because you need to know everything about them. Even when you are asking something else, such as an administrator to deal with them, they’re still time consuming. That’s something which more people need to be aware of because if you don’t have a lot of spare time to focus in on the self managed superannuation funds then it’s a problem. You don’t want to have to focus on this if something else requires just as much as attention.

You need to know what you’re doing

To be honest, super funds require you to know what you are actually doing. You have to have some knowledge or understanding within the investment field simply because it’s a lot of money to play around with. These skills are not always easy to come by simply because it takes a lot of hours of learning to acquire them. It’s a problem for a lot and that’s why some are turning away from the self managed super funds. What is more, if you don’t get the legal side of these funds right you could be in for a lot of trouble. You don’t want that either so there are some drawbacks that can give you a headache or two.

Know Before You Leap

While SMSF’s can look amazing, they aren’t without their risks. You can easily lose money as well as get very confused as to what you are supposed to be doing. It’s a problem to say the least and it’s something which more and more are dealing with on a daily basis too. You don’t want to run into trouble but of course it’s a possibility when dealing with a super fund. If you are going to use self managed superannuation funds you have to be very caution and know what you’re doing before you take that step forward. For more information visit: http://smsfselfmanagedsuperfund.com.au/blog/

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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.


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.


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.


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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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).


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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SMSF – Why So Popular?

The facts that are catching the attention of more and more individuals regarding self-managed super funds(SMSFs)  are as follows:

Investment control: The Trustees of an SMSFs –Many individuals prefer their own funding investments together with shares, residential and business property, farms, and other investments.There are limitations under the superannuation legal guidelines of how these belongings can be utilized (together with use by means of contributors) and who they can be received from. Thus,in case they could meet the fund’s on investment method, they will have to be suitable investments. click here for more about SMSF.


Family members super funds: SMSF is considered as a true inter-generational asset accumulation and also a wealth transfer car. There is no any legal period limit as to how long an SMSF can go. Therefore, lots of customers build it for when their children grow up -the benefits go well beyond the grave.


There would be an Australia’s most effective tax haven: The simplified super annuation offered by means of the previous government provides tax-free lump sums and pensions payable from a self-managed super annuation to members over the age 60. This is a large improvement for investors for the duration of their retirement when compared with all different forms of investment structures together with the loved ones trust, family organization or investing on my own or in a partnership. The other comparative exemption are the capital features tax exemption on a investor’s primary home or the sale of a business asset that meets the small business capital positive aspects tax exemptions. for further related info, click on  : https://www.dixon.com.au/smsf/is-an-smsf-right-for-you

SMSF - Why So Popular


Social protection benefits: the place a member is over age pension age (sixty five years for a male and 64.5 years for females) belongings of their SMSF member account are verified for belongings experiment and the income scan. The place a pair’s mixed belongings together with superannuation is lower than $1,092,000 for a house owner then a component cost pension is payable. For incomes test purposes, pension income much less the tax free share is classified. The tax-free factor isn’t decided by way of whether the pension revenue from the fund is tax-free within the member’s fingers; however, the component of the pension that relates to non-deductible contributions, such as the CGT exempt component and other capital type accessories.


The best Self-managed superannuation fund estate planning: The ATO has recently recounted that a member’s superannuation benefits can’t be taken care of by way of a member’s will. It is the trust deed of the fund that have got to provide rules as to how the trustee of the fund is to pay out a deceased member’s advantages to their dependents or legal estate. Importantly,going from a tax method perspective, there will be no tax regarding lump sum payments to dependents of members who pass away. A dependent involves a partner, a youngster under the age of 18, someone in an inter-dependent relationship (reside together and furnish mutual help) or an individual who’s financially sound upon the deceased member.  If the deceased member is over age 60 and receiving a tax-free pension income then this sales may continue to be paid tax free to the member’s dependents – apart from any fiscal dependent who’s a child and is over the age of 25.


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"SMSF – Why So Popular?"