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Is a SMSF right for me?

| by Chris Giaouris, CFP®

Is a Self-Managed Superannuation Fund (SMSF) right for me?

Have you ever thought about setting up a Self-Managed Superannuation Fund (SMSF) but weren’t sure whether it was the right thing to do?  Unfortunately, there is no one answer to this question as everybody’s individual situation is different.  However, there are three key questions you need to ask yourself before making any decisions.

Why do you need a SMSF?

Don’t ask yourself ‘why don’t I have a SMSF’, ask yourself ‘why do I need a SMSF’.  What can a SMSF do for you that a retail or public offer superannuation fund can’t do for you?  This might be to give you the flexibility to trade direct shares on a regular basis (‘day trade’), invest in direct property or simply to give you the feeling of greater control.

Another common motivation is people want to invest in artwork, collectibles and / or antiques.  Great caution should be shown if this is your motivation as the legislation around these items is extremely strict, not to mention it can cost upwards of 20% to sell these items at auction.  Is there value to be achieved by investing this way compared to using managed funds or receiving professional investment advice?

What do you want to do during your hard-earned free time in retirement?

Most people spend their lives working and accumulating savings so they can enjoy their retirement doing those things that make them most happy.  This could be travelling, spending time with the family, keeping fit or maintaining an active social life.

A SMSF can be time consuming between keeping accurate records, liaising with your accountant and deciding on appropriate investments.  For some people, this is an enjoyable part of retirement – is this you?

Who continues the maintenance of the fund once the dominant spouse dies?

A common issue we see is that a SMSF is established with a husband and wife as the two trustees and beneficiaries of the fund.  In some cases, the SMSF was established with only one member of the couple having an understanding of the responsibilities of a trustee.  Should this spouse pre-decease the other, they are not only left with the grief involved of losing a loved one but the stress of now having to either maintain a SMSF or obtain assistance to unwind (close) the fund.

As mentioned earlier, there is no ‘hard and fast’ rule when making this decision as every individual’s situation is different.  My advice, before you make a decision do yourself a favour and seek personal, professional guidance to make sure that you will receive significant value from a SMSF.

Chris Giaouris, CFP®
Shadforth Financial Group



Chris Giaouris, CFP®

Shadforth Financial Group
Shadforth Financial Group Limited (AFSL 318613)

Chris is a CERTIFIED FINANCIAL PLANNER®  professional and has been providing personal wealth management and financial advice since 2008. Over this time he has built specialised knowledge in superannuation, retirement strategies, tax planning and portfolio management.  Chris also has extensive experience in the UK Pension sector where he has assisted a number of clients with the transfer of their UK superannuation capital to Australia.

He believes financial planning is not solely about investments or strategies, but more importantly it is about helping you (the client) make smart choices with your money so you can focus on things more important than money.


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