What is a SMSF?
by Wealth Know How in Retirement
What is a SMSF? James Dunn starts with the basics and explains in an easy to understand way just what is a SMSF? Understanding the role of a SMSF and how it might suit your investment strategy is the first step in making one of the most important decisions of your life.
- sponsor - Wealth Know How
Wealth Know How is the online network helping people manage their wealth through financial education. Whether you are looking for simple ways to better manage your cash, or you are after a complete strategy on how to save for retirement, we can help you understand your options. It is important to have a vision for your future, but its knowledge not dreams that will ultimately deliver financial success.
Published on 13 Jan 14
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What is a SMSF? James Dunn starts with the basics and explains in an easy to understand way just what is a SMSF? Understanding the role of a SMSF and how it might suit your investment strategy is the first step in making one of the most important decisions of your life.
Sponsor - Wealth Know How
Wealth Know How is the online network helping people manage their wealth through financial education. Whether you are looking for simple ways to better manage your cash, or you are after a complete strategy on how to save for retirement, we can help you understand your options. It is important to have a vision for your future, but its knowledge not dreams that will ultimately deliver financial success.
-
Venezuela tension heats up
Duration 03:16
-
Aussie dollar surprises market
Duration 03:10
-
Markets climb as investors watch US healthcare bill
Duration 02:31
But a self-managed super fund, or SMSF, is simply a superannuation fund in which the members control the investment strategy.
An SMSF has four or less members, all of whom are trustees. An SMSF puts you in control of the decision-making, with as much professional advice as you wish. You and your advisers decide where and when to invest the funds.
An SMSF gives you a greater ability to tailor your portfolio to suit your needs, and invest directly. An SMSF also gives you more control over how you design your retirement benefits; and you can optimise the tax and estate planning benefits that you get from superannuation.
A SMSF is a trust that is registered with the Australian Taxation Office and needs to comply with the regulations, procedures and processes as outlined by the ATO. Your SMSF must also comply with the procedures and processes of the Superannuation Industry Supervision Act – SIS Act .
And with the benefits of an SMSF comes plenty of responsibility.
The regulations governing SMSFs are strictly enforced.
Under the ‘sole purpose’ test set out in the superannuation legislation, the trustees must ensure that the fund is maintained for the sole purpose of providing retirement benefits to members.
Since July 2007 all new trustees of SMSFs have been required by the ATO to sign a trustee declaration, formally acknowledging that they understand their duties, obligations and responsibilities.
But for investors who want control of their retirement destiny, an SMSF can be the perfect investment vehicle.