Self Managed Super Fund
What is a Self Managed Super Fund?
An SMSF is a private superannuation fund that you managed yourself. It is regulated by the Australian Taxation Office (ATO).  SMSFs can have up to four members. All members must be trustees (or directors if there is a corporate trustee) and are responsible for decisions made about the fund and compliance with relevant laws. Set up costs and annual running expenses can be high, so you'll need a large balance to make the fund cost-effective.

Why use Self Managed Super Funds?
Many Australians are concerned with the amount of superannuation they will have on
retirement. Many Australian's are watching their superannuation funds perform move up and
down. Many Australian's would also like to have a more hands on role in deciding what their
money being invested in.

There is now over 400,000 Australians operate their own Self Managed Superannuation Fund (SMSF). SMSF can be complex, so it's critical that you get the right advice.

Having a SMSF is not for everyone, it may the best strategy for some people and not for others, below is a list of Advanatges and Disadvantages of having a SMSF:
Advantages of having a SMSF:
  • You have control of the investment strategies
  • You control what type of investments to put your money into.
  • Flexibility of investment cash. term deposits, shares, and direct property
  • Tax deduction of life and disability insurance
  • Ability for capital protection of your share portfolio
  • Tax planning advantages
  • Able to consolidate family member's super together
  • Borrow funds to invest in an investment property
  • Ability to save on fees if you have a large super balance

Disadvantages of having a SMSF:
  • Establishment cost to set up a SMSF
  • Time consuming for legal and compliance obligations
  • Need Investment knowledge if not using a financial adviser
  • Penalties for no compliance
  • Risk of poor diversification
  • High administration cost if you have a low balance
  • Loss of availability for Group Insurance automatic cover
  • Loss of compensation rights against theft or fraud compared to an APRA regulated super fund. 

Your SMSF Borrowing to Invest in Property
Due to the amended Superannuation Industry Act the Australian Government has made it
possible for ordinary Australians to borrow money to buy property outright in their SMSF.

This is seen as increasingly popular as it allows people to invest in property while creating wealth
for their retirement at the same time without placing too much pressure on their current cash

Some Australians are uncomfortable with the volatility of the share market, they are more comfortable with property and understand the risk and cycles of property investing. This gives the super fund the ability to invest in a growth asset without the stress of the share market volatility.

When a SMSF borrows money to invest in property, there are strict rules the Trustee of the SMSF needs to follow to make sure that the fund is compliant with the ATO. 

What Can A SMSF Invest In?

Investments must be for the ‘sole purpose’ of providing retirement benefits for the members of
​ the fund. Fund investment portfolios can include many of the following investments:

  • Cash management accounts.
  • Fixed Interest, Term deposits and Bonds
  • Managed funds (Australian and international).
  • Listed Australian & International Securities 
  • Commercial & Residential property.
  • Property purchased with borrowed funds (limited recourse borrowing).
  • Property partnerships with non-related parties.
  • Shares in private companies with non-related parties.
  • Options, warrants, CFDs (not as a trader)
  • Other “exotic” investments like Artwork, Diamonds, Coins and Cars – these assets are permissible under limited circumstances with the proper investment strategy.

What a SMSF CANNOT do:
  • Do Not set the SMSF to Illegally access your super money
  • Do Not transfer residential property into your SMSF
  • Do Not provide financial assistance to you family member
  • Do Not be late in lodging your SMSF annual returns
  • Do Not borrow funds to make property improvements
  • Do Not mixed SMSF funds with personal and business assets
  • Do Not contribute into super if you are over 65 and have not met the "work test"
  • Do Not access your super unless you have met a " condition of release"
  • Do Not operate a business using your SMSF
  • Do Not do sharetrading activities in your SMSF.

" The team at Quantum has been able to help me with my SMSF set up to buy a property, it was a very smooth and painless process, thanks guys."
Michael M


 Quantum help explain that i
was paying over $24,660 in
super fund fees, now i'm only paying $2,650 a year in fees
​ with my SMSF. "
Paul W

Quantum Wealth Consultants Pty Ltd ABN 76 162 523 793 is a Corporate Authorised Representative (CARN 436555) of
The FinancialLink Group Pty Ltd ABN 12 055 622 967  AFSL 240938