Superannuation & SMSF Services.
Secure Your Super.
Throughout our working lives, superannuation or ‘super’ is regularly deposited into our retirement accounts to pay for our living costs when we get older. At a minimum, employers are required by law to pay 10 per cent of an employee’s income in super – a rate that’s set to increase over time.
However, for some Australians, employer contributions don’t result in a high enough balance to meet their retirement needs. People in this category sometimes make additional contributions or salary sacrificing some of their income to top up their nest egg. In the latter case, the employee can forego or ‘sacrifice’ some of their wages, in return super benefits. A qualified financial planner can talk through these options and what may work for your circumstances.
What is an SMSF?
Most Australians have their super stored in either an industry or retail super fund. These funds regularly deduct fees in return for holding onto peoples’ savings and are regulated by the Australian Prudential Regulatory Authority (APRA).
As an alternative, a growing number of Australians are choosing to look after their own super with a self-managed super fund (SMSF). An SMSF allows an individual or couple to manage their own superannuation contributions, investments and insurance. They are regulated by the Australian Taxation Office.
Why do people choose SMSFs?
There are a number of reasons SMSFs have become more popular. These include:
The ability to control your own investments
The ability to bundle super with other family members, which can also help to achieve scale.
Potential tax benefits
Access to assets or investment classes that other super investors usually don’t have access to.
Not having to pay fees to a larger super fund (which can erode savings over time).
Making the right choice for you and your family.
Ultimately, the choice of whether to invest with an industry or retail super fund or an SMSF comes down to individual preference. Some people love being able to control how their money is managed, while others prefer to outsource that task.
If you are considering setting up an SMSF, it may be worth seeking advice from a qualified financial planner. They can help to talk through the options, including your suitability, and can break down the potential costs and benefits in more detail.
Potential downsides.
In addition to the control and flexibility, there are several potential disadvantages of SMSFs worth thinking about. These include:
The significant time often it takes to set up the fund, manage its administration and investments.
Being liable for all investment decisions – even if you’ve sought advice from a third party.
Potential complexity in the case of divorce or the death of a member of the SMSF.
Regulations and rules tend to change over time and the SMSF trustee is responsible for keeping up to date with those changes and complying with them.
It can be costly to pay for research, advice and accounting related to the SMSF.
Why Chelsea Wealth?
We work with you to identify and prioritise your personal financial goals and help you maximise the chance of your success. We’re here to help you secure your financial future.
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Contact us.
Newcastle
Ph 02 4032 4400 | fax 02 4032 4401
newcastlewest@chelseawealth.com.au
Penrith
Ph 02 4721 5800 | fax 02 4721 5088
penrith@chelseawealth.com.au