SMSF investment

A Brief Guide to SMSF Investment Strategy for Beginners

SMSF or Self-Managed Super Funds are one of the best options when anyone wants to plan their future after retirement. This is mainly because you can have full control and flexibility over your SMSF and use it to invest your monies wisely. In fact, the very basic rule associated with SMSFs is that the trustees must decide and implement an investment strategy. It is basically a detailed plan of the finances that is put together by the trustees of the fund. More or less, all strategies are a set of rules, which are the driving force behind various investments to be done in the future by the trustees.

How to prepare an SMSF investment strategy?

Any investment strategy is set in place to achieve most or all of your SMSFs investment objectives. Speaking of investment objectives, they can be pre-decided and set by the trustees. They can do this by going through the profile of each fund member in detail. They can also analyze various assets and risk tolerance of the members to achieve the objective.

Once an investment objective is in place, the trustees can move towards preparing an investment strategy by using their knowledge. This is the reason why it is mandatory for all trustees of the fund to have a detailed knowhow of financial terms, such as SMSF borrowing or SMSF auditors to take an informed decision that benefit each of the fund members.

Now, let us take a look at some of the nitty gritty associated with SMSF setup.

Although there are numerous investment options to choose from, three of the most popular ones are direct shares, property investments and cash. Apart from these, you can also invest in collectible, managed investment schemes, listed and unlisted trusts among others.

An investment strategy takes into consideration the present financial needs as well as the future financial needs of each fund members. Moreover, it is planned out only after a detailed analysis of each of the members risk preferences. Read the news from

→ It is the trustees, who have to take the decisions regarding investing the fund assets and document and monitor the performance on a regular basis. If required, they may even update the investment strategy for the people.

SMSF investment→ Sometimes, it is essential to update the SMSF investment strategy as and when there is change in risk preferences or the financial expectations of the members, the introduction of a new member, death of a member or deteriorating health of a member among other reasons.

There are also certain investments that are prohibited. To understand this, the very first thing that the trustees should ensure is that they must comply with the latest SMSF laws. Some examples of prohibited investments are as follows:

→ The SMSF should not make loans to any fund members or their relatives

→ Any investment made should not breach any rules

→ There are restrictions on acquiring assets from related parties, which much be observed

So, this was SMSF investment strategy is a nutshell. Post your comments about the same and feel free to share your tips as well.…

Australian Taxation Office

5 Things You Should Know Before Setting Up Your SMSF

With lacking returns last year from most super funds, people are looking to put their money elsewhere, mainly to self-managed super funds (SMSF). However, before you go transferring all of your retirement funds into a SMSF because of a bad superannuation return statement, there are many things to consider.

1. Will an SMSF really benefit your returns? Many people rant and rave about the fees superannuation funds charge, but, the truth is, if you don’t have the time, focus or knowledge to manage your own super fund, an SMSF may not be for you. Alternatively, if you do have all of these things, then you could be looking at far higher yearly returns on your retirement fund.

2. What is your investment strategy? When you open a SMSF you effectively become your own fund manager. For the technical and administrative component (which is about 10%), it will often be outsourced to accountants. The part of a self managed super fund that will take up the most time is sourcing and managing places to invest your money. Developing a sound investment strategy will allow you to reap the benefits of a SMSF and ultimately take control of your money. Reviewing your self managed super fund investment strategy should be a regular occurrence to keep up with market trends and changes.

3. Who will be the nominated trustees on your SMSF? Before setting up your account, aside from your own name, you’ll need to understand who else will be trustees of your self-managed super fund. You can have up to four names on the account, but they cannot be your employees (unless they’re related). Alternatively, you can nominate a company as the trustee so long as the company directors and fund members are one and the same. However, you still must have only four names on the fund and they cannot be employed by you.get more details from

4. Do you understand your trustee obligations? The Australian Taxation Office has made many attempts over the last few years to help instruct trustees on what their roles and responsibilities are in the management of a SMSF through various publications. If you receive any communications from the tax office, be sure to thoroughly read everything. If you have any questions call the ATO or your accountant.

Australian Taxation Office5. Is your deed current and correct? A deed is the bible by which you’ll run your self-managed super fund, so if the deed is unclear as to what you should do in certain situations or isn’t up to date with legislation, then it is not a good guide. For instance, some people have misunderstood that the blanket statement in most deeds which says “if the deed is inconsistent with the legislation, then the legislation will prevail”, will cover any future changes in the law. This is actually not true.

With lacking returns last year from most super funds, people are looking to put their money elsewhere, mainly to self-managed super funds (SMSF). Before you go transferring all of your retirement fund to a SMSF, there are many things to consider.…