Self Managed Super Funds
According to the Australian Taxation Office, self managed super funds are the largest and fastest growing area of the super industry.
While there are a number of benefits that come with a SMSF there are also strict rules on how you can manage and how you can invest your contributions.
Many people fail to manage their SMSF appropriately by not submitting annual tax returns, not having members or assets for their funds audited, or not giving a detailed investment strategy. Establishing a SMSF takes time, knowledge, skill, and money and is a major financial decision that should not be taken lightly.
So why are they so popular?
SMSF operate in a similar fashion to independently managed super funds except the members are usually the trustees of the fund. Their advantages lie in greater flexibility and control in investing, tax effectiveness, lower operation costs, along with more direct involvement. Lower operation costs are more often found with funds with larger investments or with family combined super benefits. Generellay the industry agrees that in order for a SMSF to be cost effective the minmum balance should be $350,000.
To completely comprehend the costs and benefits, it is important to speak with an EPG adviser to determine if a SMSF is your best super option.
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