If you are thinking about setting up an SMSF to take charge of your superannuation savings, there are many factors to consider. Before you contact a broker, it is important to do a lot of research on the subject, so you know exactly what you are getting into. Read through this article to ensure you are better prepared when establishing an SMSF.
Understanding the System
Since 2017, there have been a variety of changes to the superannuation system and SMSF loans. Before you get involved in any project involving SMSF, you need to know the landscape. If trustees breach the super rules, they will be hit with some harsh penalties. There have been a lot of changes and new rules introduced in the last few years, especially to Australians who are trying to downsize their property to improve their super.
Finding the Right Help
Managing your own SMSF is a real challenge, it calls for tax management, administration duties and a lot more. If you do not have the time nor the expertise to manage the fund, you will need to find someone who does. You can get assistance from a range of professionals, some of which include:
- Brokers
- Financial Advisors
- Accountants
SMSF’s must be managed by experienced individuals, when choosing a team, make sure you ask them about their knowledge of the subject. You can go online and find a specialist in your area, one that is accredited by the right organisation.
Choosing Your Trustees
Before you set up an SMSF, you must decide on the number of trustees who will be involved. You can choose one trustee, or you can select your partner or other family members. When you have decided, you will need to prepare a trust deed.
Strategy Preparation
You must prepare an investment strategy for your SMSF. This strategy must also be reviewed on a regular basis. When planning a strategy, you must consider a number of important areas.
- The fund must have clear and concise objectives.
- You must display each type of investment
- Members may have life insurance
Once you have done all the important work, the next step is to invest the funds. When investing, it makes sense to diversify your assets, this way you will not get caught out if you have all your eggs in the one basket. It is important to balance your investments; your portfolio should include a mix of high and low risk projects.
Comments are closed.