Are Self-Managed Superannuation Funds Right for You?


Self-managed superannuation funds are a type of investment structure whereby you can actively manage where exactly your retirement savings are going to be invested. It is vital that you save enough money for retirement as you don’t want to be worrying about finances at that stage of your life. Many people do not like going to funds that work a lot on commission and fees, and instead preferring to actively manage their savings themselves. It is important not to put all of your eggs in one basket, and the SMSFs provide you the opportunity to spread your investments in a diverse range of industries and vehicles.

An SMSF are clearly a great option; however they are not for everyone. Some people don’t have the necessary knowledge or skills to be able to invest their savings themselves. It is a time consuming process when you have to search out for viable investment opportunities and your retirement savings are not something you should be taking lightly. Here is some advice that will help you decide if SMSFs are right for you.

Are Self-Managed Superannuation Funds Right for You?

SMSF Options
SMSFs are suited down to the ground for those who want to actively manage their own retirement savings. They are willing to take on the risks involved to invest their money in long term opportunities.

They are a great option for those people who are self-employed as they will not have a retirement plan that is provided to most corporate workers. This doesn’t mean if you’re not self-employed they won’t work for you, you just need to weigh up your options between the retirement savings plan that is provided for you by your employer, and your ability to choose your own investments through the form of an SMSF.

Always Consult a Professional
Before making the commitment to using a SMSF, you should talk with a professional advisor or fiduciary who will be able to walk you through the process and help you to decide if this is a good idea. Make sure that they are licensed and are experienced when it comes to dealing with SMSFs. Talking with a tax accountant is helpful as these types of funds can have large effects on your tax bill at the end of the year.

Take the Cost and Time Commitment into Consideration
While the costs that you run up during the course of managing your SMSF is often significantly less than a fund that is managed by professionals, your time is also a valuable commodity. When you place your retirement savings into the hands of a professional, that’s pretty much your job done, you let them do the rest to invest it.

On the other hand, when you are using a SMSF and are actively managing your investments, you have to spend significant time researching which are the best investment opportunities for you, how much you should invest and for how long. This process takes time that you need to be willing to put in.