The Financial System Inquiry Final Report (released on Sunday 7 December 2014) recommends that direct borrowing by SMSFs be prohibited.
The proposed legislation states that self-managed superannuation funds should be banned from borrowing to buy assets such as property and shares, which would heavily impact your self-managed super fund investment opportunities.
Most of our clients set up their self-managed super funds so they personally can control their investments. Many Australians are most comfortable investing in real estate because it’s what they understand. It’s predictable and stable in comparison to shares and other investment portfolio options.
Current legislation allows the average Australian with property investment knowledge to control and grow their Superannuation savings through investing it into property. However, if these recommendations are implemented, you will no longer be able to use direct borrowing to buy property within your super.
Our advice: Don’t wait, the law could change and you will miss your opportunity to more effectively control your super. Educate yourself by consulting with our financial advisors and SMSF specialists, make a decision while there is still time, and invest in property with your super.