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.