Benefits of Opening a Self-Managed Super Fund

March 7, 2016 - 3 minutes read

Self-managed super funds (SMSF) are currently the fastest growing sector in the Australian Superannuation Industry. With so many Australians making the move, you may wonder what the benefits are, and if it’s a suitable option for you. Superannuation Property recommends weighing up the benefits and risks before establishing an SMSF.

SMSF benefits

The clear benefit of an SMSF is that you are 100% in control of your investment strategy and you may directly monitor and control where and how your super is invested. You have complete choice over asset selection, and this is where many of our clients get excited about investing into property, if it’s suitable for their situation.

Another benefit of opening an SMSF is that you may choose to set up a fund shared by your family, or pool your super savings with a partner before creating your investment strategy. This can come in handy if you are looking to borrow to make larger investments, which our clients regularly do to invest in property.

SMSFs also offer attractive tax benefits depending on what investment selections you make.

Is SMSF a fitting option for you?

Setting up an SMSF involves more time and attention than an industry or retail super fund, and this is something to be mindful of. You can hire professionals, such as Superannuation Property, to help you with every aspect of setting up and running your SMSF, but you are still ultimately responsible.

Generally speaking, the minimum required balance to invest in property with a SMSF individually or jointly is $150,000. If you have below this balance, there are other strategies that may be better suited to your retirement plan.

It is also important to know that opening an SMSF involves a variety of costs, however, these costs can often be covered by the fund itself.

Our diagram below summarises the pros and cons of investing in property with an SMSF:

Pros and Cons of Investing in Property with SMSF

Ensure you receive the right advice

Superannuation Property financial planners won the 2015 Investors Choice Award for ‘Best Financial Planners in Queensland’. Our advisers are qualified and licensed to give tailored advice for your situation. Ensure you speak with a financial planner before opening an SMSF to learn all the risks and benefits, and assess if it’s a viable option for your situation.