What Is a Self Managed Super Fund (SMSF)? ✔️ Pros and ❌ Cons Included.
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- Опубліковано 13 чер 2024
- Learn all about SMSFs. The good, the bad, the pros and cons. A complete explanation of what an SMSF is, how it works, the costs involved and how it compares to other superannuation funds.
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⏱ Timestamps
00:00 - What is a Self Managed Super Fund?
00:41 - What is a SMSF?
01:20 - Comparing Super Funds
02:22 - SMSF Advisers
02:54 - SMSF Benefits
06:27 - SMSF Disadvantages
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- What Is a Self Managed Super Fund (SMSF)? Pros and Cons Included. --
With a self managed superannuation fund (SMSF), the world is your oyster. A SMSF provides you with unrivaled control over your retirement savings and significantly greater flexibility with your superannuation investments. But, what is a SMSF?
Before setting up a SMSF, it is essential to understand what an SMSF is and how it works, because it’s not all roses. To understand what a SMSF is, you need to first understand how it compares to other types of superannuation funds, such as industry super funds and retail super funds.
Most people like the idea of SMSFs, because it allows you to use your superannuation to purchase investments that aren’t otherwise available through standard super funds. Commonly, people look to set up SMSFs to purchase property; but’ setting up a SMSF can be beneficial for other types of investments, too.
In this video, I’ll explain the different types of super funds, how a SMSF compares, the process involved in setting up a SMSF and what your responsibilities are once you set up a SMSF.
#SuperGuy #ChrisStrano #Superannuation #RetirementPlanning
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General advice is provided by Toro Wealth Pty Ltd trading as SuperGuy Retirement Experts as an Authorised Representative of Core Value FA Pty Ltd (AFSL 480387).
Before acting on any information, you should seek professional advice and verify our interpretation/s before relying on the content or calculators within this website or on the videos, while also considering its appropriateness in relation to your personal situation.
Im 3 years into my SMSF.. Your admin figures are pretty close.
The auditor fee is probably my biggest expense.
Best thing I ever did, every decision is my own. It gives you a sense of financial freedom.
It's certainly a steep learning curve. The best lessons, have come from mistakes, not successes..
I haven't become rich & I haven't gone broke. It's a start..
Thanks for the video.. I'll watch more of these.
You're welcome. Glad to hear you are happy with your situation.
May I ask how much audit fee each year? Is it really as much as $2000-$3000 per year? My super account has only 100K. I am an active trader. Currently I use ING which support trading Mutual Funds by myself. But the trading cost is so high. Each it will be around $1000 for me.
$1100 for the audit.. I started with less than 100k
@@AussieKingYT thanks a lot. 🙏 can I ask which smsf firm do you use? I am planning to use interactivebrokers and want to know if there are better choices. 😃Thanks in advance
@TraderS4m E-Super.. I only knew about ESuper & Hefron..Herron.was $3000 a year, but has more customer service. I haven't heard of the one you picked.
I started with 70k I think, at the start of covid.
Thank you for your videos. I managed to set up a SMSF 5 years ago by purchasing a property. I have since sold, doubled my super and retired at 56 in beautiful Thailand! It’s been transferred into an industry fund. Luckily have enough funds for around 10-15 years before drawing on my super. Very lucky that I made the right investment choices at the right time! 🙏
Very helpful indeed. Thank you
You're welcome. I appreciate the comment!
Thanks. Love your videos. We have a SMSF, love that we have more control over it. No shocks when the share market crashes etc. Have property in ours and it is stable income coming in hassle free really as we not much involved in paperwork and easy audit. Once you understand the rules it’s pretty simple. Looking forward to setting up a meeting. Have been following you for sometime now.
That's right. As long as you understand what you have and how it works, SMSFs don't need to be complex. Unfortunately, many people (and their advisers) unnecessarily overcomplicate them. We'll be here when you're ready for a meeting www.torowealth.com.au/
One risk not considered by SMSFs is key person risk. Many them are husband and wife funds that are managed by one partner (often the husband) who has an interest in the subject. But if that person is hit the by the proverbial bus, the remaining member may not be in a position to properly manage the SMSF.
Agreed. Each partner should understand which professionals are assisting with the management of the SMSF and what action should be taken if the bus hits.
VERY GOOD QUESTION
That’s interesting, def something to consider
Thanks Chris, would you be able to make a video to talk about estate planning, and estate planning with SMSF?
one thing to add is the 'arms length' rule when SMSF is buying residential properties.
Yes, the arm's length rule is very important. I discuss this in the videos relating specifically to using SMSFs to purchase property.
Great vid, im considering starting an SMSF but it’s probably a bit too expensive for me at this stage.. a bit of a paradox really.. spend thousands and potentially earn millions.. but if you don’t have the thousands we’ll then you can’t make the millions.. once you have the millions the thousands aren’t anything and in hindsight you would probably do anything you can ti have the thousands to set up the fund in the first place. Never have enough money, nothing new
Yeah, it's a bit like that! For many people SMSFs aren't suitable. Best not to overspend when it comes to your super until the benefits clearly outweigh the costs.
Great video thanks SuperGuy - I'm keen to hear your thoughts on an SMSF versus something like Hostplus's Choiceplus that offers members an active role in the management of their superannuation investments?
There's no wrong answer, it all depends on what you're looking for. A SMSF will undoubtedly provide greater control and more investment flexibility. But, if an Industry Fund provides all that you need, then it could save you the higher cost, responsibility and administration burden associated with an SMSF.
Hi Chris, can the SMSF, pay for a deposit, on buying land, to later build a house on that land, to live in that house? Thank's.
Chris, thanks for the videos. To purchase a property in Italy, I have read you need a simple LLC and shares owned by SMSF. How would that work in term,s of corporate trustee ownership of shares?
You're welcome. I'm not sure where you might have read such information, but it doesn't seem to be entirety correct. There are a number of ways to structure property ownership within a SMSF and it doesn't need to be complicated, but it does need to be compliant. Compliance is based on superannuation rules, the SMSF trust deed and the SMSF investment strategy. If this is something you are considering, I would strongly suggest obtaining personal financial advice.
I"m surprised at the annual costs. In the US you can invest in low cost index funds with Vanguard at 0.03%, is that possible in Oz?
Yes, there are some index funds that are very low cost. In fact, there are some synthetic index funds with 0% fees. However, there are merely managed funds or ETFs. When it comes to superannuation, there will be additional fees, such as member fees and administration fees to ensure a compliant superannuation structure.
Is there any restriction on Superfund trading CFD's.
I was just told for first time in 20 years I can trade CFD's but there is NO leverage allowed which defeats the purpose of the CFDS.
I trade Forex GBP using CFD's with leverage for years.
Investing in CFDs is generally permitted in accordance with ATO guidelines, provided the SMSF Trust Deed and SMSF Investment Strategy allows it. You will also need to prepare a Derivatives Risk Statement. I would strongly suggest discussing this with your SMSF administrator or financial adviser before acting upon it.
Hi mate, I am also an active trader. I am planning to use SMSF to manage my super. The trading cost is too high in my current Super. Each trade it charges me $20 and each year I pay more than $1000. I am planning migrate to SMSF and trade us shares, which only charge $1. May I ask do we need to pay tax for CDF trading? I am new to AU and I read spot betting is free of tax. Is this true? :D
Do you need to setup a trust separately then setup an SMSF? How does it work
I'm not sure exactly what you mean. A SMSF is actually a trust in itself. A separate trust does need to be setup if you plan on borrowing within the SMSF. I would suggest obtaining professional financial advice prior to doing anything.
Thank you, sorry I mean what is the difference between a corporate trust versus an individual trust, I've been asked to setup a corporate trust so just wandering if I need this@@SuperGuyAu
Is super fund guaranteed by ATO if super fund company goes under?
I don't believe so.
Audio needs to be better
Thank you
May I ask how much audit fee each year? Is it really as much as $2000-$3000 per year? My super account has only 100K. I am an active trader. Currently I use ING which support trading Mutual Funds by myself. But the trading cost is so high. Each it will be around $1000 for me. I think I can make arround 20%-30% profit each year with trading. Do you think I should migrate to SMSF? Thanks in advance.
SMSF administration (accounting) costs usually begin at around $1,500 per year and audit costs are at least $300 per year. That's on the low side. If you actively trade and have many transactions, your costs might be higher. If I were you I would seek professional financial advice to determine whether a SMSF is suitable for your needs or not.
@@SuperGuyAu Thanks mate, it is very helpful.
I’ve got around 200k in my super and planning to use it to payoff my investment property, my question is if I use SMSF n be debt free on my investment property do I have to return the income from investment property to SMSF or the cash goes to my pocket?
Thanks in advance
Can I do partially SMSF? Let’s say I have a total super of $150k, I just want to use $50k of that total super to set up a SMSF and leave the rest in my current super fund. Is this ok? Thanks
Yes, that is certainly possible. However, most would advise against establishing a SMSF with only $50,000. You can read more about starting a SMSF here www.ato.gov.au/uploadedFiles/Content/SPR/downloads/StartingSMSF_n75397.pdf