Self Managed Superannuation
Self Managed Superannuation
Self Managed Superannuation Funds continue to be an attractive superannuation vehicle for those who are looking to take more control over their retirement plans and enjoy the flexibility and transparency the structure provides.
A self managed superannuation fund can have up to four members, all of whom must be trustees, and all trustees must be members (with exceptions in limited circumstances). As both a member and a trustee, you make all decisions relating to the operation of the fund, including how the fund’s assets are invested. While this gives you added responsibility in relation to your superannuation, the majority of the compliance and administrative tasks can be outsourced, meaning you can enjoy the flexibility and control offered by the structure without being burdened by the obligations associated with running your own superannuation fund.
The Politis Investment Strategies Account Administration Service takes care of the administration required to maintain the records of a Self Managed Superannuation Fund.
Southern Financial Solutions Financial Planners are experts in this area and can provide you with an explanation of the benefits provided by Self Managed Superannuation Funds.
Limited Recourse Borrowing Arrangements
Generally speaking, Self Managed Superannuation Funds are prohibited from borrowing, however, the introduction of Limited Recourse Borrowing Arrangements has opened up the opportunity for Self Managed Superannuation Funds to gear into assets, most commonly direct property.
As with any gearing strategy, careful consideration must be given to the Self Managed Superannuation Fund members’ overall financial situation, needs and objectives to ensure the strategy is appropriate.
Limited Recourse Borrowing Arrangements are becoming increasingly popular with trustees of Self Managed Superannuation Funds as property is seen as a “safe haven” asset, however the risks and significant limitations must be fully understood before the arrangement is entered into.
Many Self Managed Superannuation Fund trustees to do not appreciate the risks that can be involved if the strategy does not run according to plan.
Limited Recourse Borrowing Arrangements can be effective and their use cannot be discounted, but often the risks involved do not need to be borne to achieve similar outcomes.
Direct Equity Investment
Using a Self Managed Superannuation Fund to invest directly in shares and other listed securities maximises the control, transparency and cost savings the structure provides. Self Managed Superannuation Fund members are able to visualise and monitor the assets underlying their retirement savings with a level of ease not offered by other superannuation accounts.
Investing in shares and other listed securities requires a level of expertise, experience, time, and access to research which most Self Managed Superannuation Fund trustees do not have.
The Politis Investment Strategies Managed Discretionary Account Service provides Self Managed Superannuation Fund trustees with access to structured portfolios which are discretionarily managed by a highly experienced Investment Management Committee, while retaining direct legal and beneficial ownership of all investments.
The Politis Investment Strategies Managed Discretionary Accounts allow you to invest in a cost effective, transparent manner removing the burden of portfolio administration and record keeping.
Direct Property Investment
Self Managed Superannuation Funds are able to invest in direct property. This can be a particularly attractive strategy for those who operate a business and have their superannuation fund own the premises. The strategy provides for long term income tax and capital gains tax benefits which often cannot be enjoyed if the property were owned in a non superannuation structure.
Although the benefits to holding property in superannuation can be significant, there are also pitfalls that can be encountered if the superannuation fund is invested too heavily in property or in an inappropriate property, which can lead to diversification and liquidity problems. It is imperative that a comprehensive planning process be undertaken before the decision to purchase property in superannuation is made.
This information is of a general nature only and has been prepared without taking into account your particular financial needs, circumstances and objectives. While every effort has been made to ensure the accuracy of the information, it is not guaranteed. You should obtain professional advice before acting on the information contained in this publication. You should also obtain and read a copy of the Product Disclosure Statement before making any decision to acquire a financial product. Jason Ellis of Southern Finance Solutions Pty Ltd, Authorised Representative of Politis Investment Strategies Pty Ltd, ABN 71 106 823 241, AFSL 253125.