Increasing numbers of young professionals are making more long term decisions about their financial futures as their interest in Self Managed Super Funds (SMSF) grow.
As at the 30th June 2013 there were 512,000 SMSFs (holding over $50 billion of assets) with more than 39,000 SMSF established during the last financial year.
If the growth in SMSFs continues, it is likely that 1 million Australians will have a SMSF by 30 June 2014.
Whilst the over 50s still account for the greatest numbers of SMSFs, there is an increasing number of 31 – 40 year olds expressing interest in managing their own super. Demand from this age group has grown over the last 3 years according to an annual survey from the SMSF Professionals’ Association of Australia and Russell Investments.
“The encouraging growth of the 31 – 40 year age bracket shows that they want to take control of their super money and can see the long term opportunity SMSFs can provide for their future’ says Greg Perks Director of Perks Integrated Business Services.
The four key reasons that the younger generations are showing more interest in SMSFs are control, tax effectiveness, potential cost savings and flexibility.
SMSFs allow the trustees to manage their own fund and take control of the investments within that fund. It also provides the widest choice of investments for your super including shares, managed funds, property trusts, fixed interest, direct property & property syndicates. There is also the additional flexibility of being able to invest in collectables and artworks.
Whilst there may be more young people getting on the bandwagon, they remain comparatively wealthy according to the survey. They average net worth of existing SMSF holders is $457,246, excluding the family home. The assets of the younger generation who intend to set one up soon are on average $292,153.
According to Greg Perks ‘anyone wanting to set up a SMSF should seek advice from an experienced SMSF professional.”
“It’s not all about picking stocks and sectors – you need strategic investment advice to ensure you achieve your desired goals and to help you deal with complex issues like sequencing risk, and the impact of this on retirement outcomes. But with the right advice you can absolutely reach your retirement goals through a SMSF” says Greg Perks.
“At Perks we have the ability to assist clients in setting up and growing their SMSF whilst making sure all of their obligations and retirement goals are met”.
For more information about SMSF call Perks today on (08) 8273 9300.
