A ‘self managed super fund’, also known as a DIY Super, is a way for employees and their employers to jointly contribute towards the employee’s pension. The money is invested in government bonds, shares or even property until the employee retires. Upon retirement, the employee can release the fund in one of three ways; either as regular payments, as a lump sum, or as a combination of the two.
The advantages of having a DIY Super are:
Control: By having a DIY Super, you have the flexibility to choose how and where your funds are invested and also the ability to adjust your investment strategy based on ever changing economic factors.
Investment Choice: Having choice in where and how much to invest with your DIY Super gives you a huge advantage in customization of your funds investments compared to other similar funds that can not offer this.
Low Taxation: Tax concessions are available for DIY Supers, which means that the government takes as little of your hard earned money as possible. This can amount to significant savings over the course of the fund.
Protection: A DIY Super is protected against legal claims and bankruptcy meaning that your money is safe. Up until you release it, that is!
Bear in mind the points below if you are considering investing in a DIY Super for your retirement…
– Every associate needs to be a trustee
– A Trustee cannot receive compensation for carrying out any duties
– Compliance with regulations is your responsibility
– Your assets and the fund must not merge
– For the length of the fund, you must keep track of all paperwork including receipts, statements and records
It is possible to get financial help with a DIY Super, though remember that the responsibility is ultimately that of the members and trustees. There are many independent financial advisors that can offer help on investments for DIY Supers, but be sure to research the advisors themselves before committing yourself or your fund to anything.
Always research the financial advisor before committing yourself or your fund to anything. Check their credentials and be prepared to pay more for advisors that have experience in dealing with a DIY Super fund.
Remember, starting a DIY Super is not a decision that you want to take lightly, and that applies to each stage of the process. So, carefully consider who you want to open the fund with and what exactly you want to invest in, as well as who you will hire to advise you on the rules and regulations that you must adhere to.
Find Out More – DIY Super Sydney