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Is a self-managed superannuation fund the right option for you?

Ensuring there's enough money in the bank to enjoy a comfortable retirement is something everyone wants. A self-managed superfund (SMSF) is one pathway you can take to achieve this. A SMSF could be the right option if you want to have control over the level of contributions you make to your fund, and what investments your fund makes.

There are, however, several important factors to examine if you’re considering this type of superannuation to ensure you get it right from the beginning.

1. Can you make contributions to your SMSF as an employee?

Unless your employer gives you the right to choose your own superannuation fund, you won’t be able to have your employer’s compulsory contributions paid directly into your SMSF.

2. Do you have enough money to make a SMSF beneficial?

To be cost-effective for members of a SMSF, a balance of between $200,000 to $250,000 is required. You need to make sure the returns you’re earning will cover the costs of running a SMSF, plus provide an investment return. By making significant contributions for the first couple of years, a SMSF can still be cost-effective for members if you don’t currently have this amount.

3. Do you have an accountant or financial planner?

A SMSF is a big commitment and can last well past your retirement (if you plan for your fund to provide you with a pension). Plus, administering am SMSF takes significant knowledge, and the reporting, monitoring and investment requirements can be demanding. It is generally best left to a professional with the skills and tax expertise to run the fund on your behalf.

4. Do you have a plan on what the fund will invest in?

There are certain restrictions on what a SMSF can invest in. The main purpose for investing through a SMSF is to maximise retirement savings for the members. You need to make sure the investment strategy you follow considers the risk profile of the members.

5. Are you aware of ATO requirements in running a SMSF?

The ATO publishes various publications on what is required by trustees to run a SMSF. You need to be mindful of these requirements to ensure that you’re operating a compliant SMSF.

Sounds good. Now what?

So, you’ve decided a SMSF is the right choice for you and your family. Great, but who are the SMSF accountants Perth residents can rely on?

Ascent Accountants.

Due to the complex regulations and reporting requirements for SMSFs, it's crucial to have experienced staff. Staff at Ascent Accountants are continually undergoing training in this specialised field — your fund will meet all Australian Taxation Office administration and reporting requirements. To put it simply, we have the skills and expertise to assist you in setting up and administering a self-managed superannuation fund. What more could you ask for?

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