There are many benefits of having your own SMSF. Some of the most important include:
You make your own decisions on the fund's investments. You can make all the key decisions especially how, where and when your money is invested. You may also switch or modify your investments as and when you see fit.
The investments can cover a wide range including shares, banks and other deposits, property (with some restrictions), managed investments etc.
You can actually have your life insurance policies paid by the fund, with a resulting tax benefit.
It can help in establishing a more tax effective structure for your family in the event of your death. With a tax rate of only 15% superannuation already offers favourable tax treatment. SMSFs allow you to plan your investments to be tax effective for the individual members of the fund, for example using franking credits from dividend payments to reduce the 15% standard tax rate on contributions. Having both pension members and accumulation members in the same fund can provide additional opportunities to offset the tax payable.
The costs are usually significantly lower than belonging to a public fund run by a bank, insurance company or fund manager. You can save a great deal of money by managing your own super by sharing running costs between the members. The cost break-even point versus a superannuation managed fund can be as low as $200,000, with savings growing rapidly thereafter. This does not preclude funds being established with lower balances depending on individual circumstances.
For those moving from the accumulation phase to the retirement phase, the advantage of simply re-arranging your assets within the fund without the need to sell any existing assets is of great benefit.
If you are considering establishing a self-managed super fund, refer to the following link to the ATO’s booklet, Thinking about self-managed super, to determine if a self managed super fund is right for you.
