Self-managed super funds have been subject to enormous change over the last couple of years.
In the early 90s, superannuation became an obligation for all employers. In the late 90s and early 2000s, the government brought in what was called Simple Super or Simpler Super. It wasn’t just simpler – it was actually really beneficial for people as well. During this time, tax rates dropped and all sorts of other advantages started to come about. For a fifteen year period, every single decision around superannuation and self-managed superannuation was really good for clients and for tax.
However, in the last three years, things have completely changed. The taxes around self-managed superannuation have increased, and the benefits have dropped a fair bit. Especially for those who are 55 or 60 going into a transition to retirement, a lot of the tax benefits have disappeared.
More importantly, for me as a tax accountant involved in superannuation, I cannot advise clients anymore. I cannot recommend whether to go into a superannuation fund, how to invest money, or what sorts of pensions they should be trying to access on retirement. Fifteen years ago, we were able to advise and guide our clients. Nowadays, taxation accountants have been completely removed from the picture.
For a lot of our small business clients, as I’ve mentioned before, self-managed super funds are their darlings. They save a lot of tax through superannuation, and it drives their investment strategies.
Despite all of the changes, we still encourage and support the use of self-managed super funds for our growing small business clients. However, the way you go about establishing your fund has dramatically changed.
If you want to start a self-managed super fund, or talk to someone about contributions and investment strategies, you’ll need to go and see a Self-Managed Super Fund Specialist. Of course, that’s if you are still going to take responsibility for investing your money. If you need help with investing, you’ll need to partner with a Private Wealth Advisor.
The world has certainly changed, folks. With the ever-changing environment of self-managed super funds, it is crucial that you direct your time to a specialised advisor that knows how to assist you. They can set up your fund and provide you accurate advice with no worries.
