There has been spectacular growth in Self-Managed Super Funds over the last 19 years and there is nothing in the recent announcements made by the federal government that will change this phenomena . Australians with more than $2 million in superannuation will lose some tax concessions under changes to the system announced by Treasurer Wayne Swan. Treasury estimates that about 16,000 people will be affected by this measure in 2014-15, which represents about 0.4 per cent of Australia’s projected 4.1 million retirees in that year.
So let’s just take a close look at these astonishing numbers that are only going to continue to grow
1994 80,000 SMSF with $11 Billion in assets
2012 478,000 SMSF with $439 Billion in assets
That’s a significant 1/3 of the 1.4 Trillion of funds put away by all Australians…that’s nearly a whopping 40 times higher than in 1994
Currently Australians are placing $26.5 billion into SMSF every Year that’s just over $500mill every week…..
The question is Why?
There is no one simple explanation, but its obvious the appeal is to both young and older Australians and the attraction of controlling their own retirement destiny is undeniable. Almost all new clients that approach us are interested in planning for their retirement and there is no age barrier.
We speak to many clients that specifically want to establish a SMSF and the reasons vary
Here are some of the many driving factors that clients tell us when establishing their SMSF
- Control of their future and retirement especially older Australians.
- Significant Tax advantages whilst accumulating and on retirement.
- Speaking directly to the administrator of your SMSF which is normally the appropriately qualified accountant or Financial planner and you can gain immediate access to get issues addresses.
- Property Investment acquisition opportunities both directly and via leverage through bank funding if structured correctly.
- Estate Planning benefits in regards to pension payments beyond death and the strategic use of reserve accounts within the SMSF.
- Reputational damage of larger organisations due to poor service delivery and return’s.
Non Executive Director – Chan & Naylor
Disclaimer: This material is not intended to constitute personal advice, and must not be relied on as such. This information has been prepared without taking into account a potential investor’s objectives, financial circumstances or needs. Before making a decision based on this material, a potential investor should consider the appropriateness of this material having regard to their objectives financial circumstances and needs. A potential investor should
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Chan and Naylor are specialists in SMSF and our suitably qualified accountants and Wealth planners can assist you with understanding how a SMSF works and if appropriate assisting with the establishment and ongoing service of your own SMSF.
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