DIY Superannuation - How Much Control Do You Want?
The superannuation system is great for all of us. Our employer puts money away for our retirement, money which we never really see anyway so it does not impact our lifestyles. Then, when we retire, we have a massive pool of saved funds which we can enjoy.
One of the pitfalls of superannuation for me though is the way you lose control of your money. It is your money, yet often someone (such as your employer and usually due to your own inaction) decides where your money is invested. For this reason, I set up my own Self Managed Superannuation Fund (SMSF).
All a DIY Super fund is, is a legal structure you can use to manage your own superannuation money. There are a number of responsibilities you must take care of, ensuring the fund meets its obligations in as much as superannuation laws go. Once set up though, you can be as involved as you want and outsource the parts you are not interested in managing. The things that need to be taken care of include:
1. Your Trustee Responsibilities. Someone needs to legally own the assets of the fund. This is the trustee. The trustee is also responsible for the running of the fund, so if anything goes wrong, it is the trustee who is legally liable.
2. Administration - The administrator looks after all the book keeping and accounting responsibilities. They will prepare and lodge the annual tax returns and documents and ensure all the accounts balance at the end of each financial year.
3. Audit - The auditor looks over all the accounts prepared by the administrator to ensure they comply with the existing superannuation and tax law. A successful audit will mean you maintain your status as a complying superannuation fund, so you can continue to receive the superannuation tax benefits.
d) Investing the money. Superannuation is retirements savings. Someone needs to make all the investment decisions within the superannuation regulations, in a way which maximises the future retirement benefits of its members.
Myself, well all I wanted was to make my own investment decisions, live and die by my own sword so to speak. I have always thought this was really important as retirement savings are one part of my entire investment strategy and estate, they are not an isolated pool of funds. The decisions I make here need to be responsible to the big picture and work in harmony with the non-retirement savings investment decisions I make.
All other responsibilities I outsourced. To me, they were time consuming tasks which were better undertaken by experts in the relative fields. This left me with more time to research and make investment decisions. - 23221
One of the pitfalls of superannuation for me though is the way you lose control of your money. It is your money, yet often someone (such as your employer and usually due to your own inaction) decides where your money is invested. For this reason, I set up my own Self Managed Superannuation Fund (SMSF).
All a DIY Super fund is, is a legal structure you can use to manage your own superannuation money. There are a number of responsibilities you must take care of, ensuring the fund meets its obligations in as much as superannuation laws go. Once set up though, you can be as involved as you want and outsource the parts you are not interested in managing. The things that need to be taken care of include:
1. Your Trustee Responsibilities. Someone needs to legally own the assets of the fund. This is the trustee. The trustee is also responsible for the running of the fund, so if anything goes wrong, it is the trustee who is legally liable.
2. Administration - The administrator looks after all the book keeping and accounting responsibilities. They will prepare and lodge the annual tax returns and documents and ensure all the accounts balance at the end of each financial year.
3. Audit - The auditor looks over all the accounts prepared by the administrator to ensure they comply with the existing superannuation and tax law. A successful audit will mean you maintain your status as a complying superannuation fund, so you can continue to receive the superannuation tax benefits.
d) Investing the money. Superannuation is retirements savings. Someone needs to make all the investment decisions within the superannuation regulations, in a way which maximises the future retirement benefits of its members.
Myself, well all I wanted was to make my own investment decisions, live and die by my own sword so to speak. I have always thought this was really important as retirement savings are one part of my entire investment strategy and estate, they are not an isolated pool of funds. The decisions I make here need to be responsible to the big picture and work in harmony with the non-retirement savings investment decisions I make.
All other responsibilities I outsourced. To me, they were time consuming tasks which were better undertaken by experts in the relative fields. This left me with more time to research and make investment decisions. - 23221
About the Author:
Gnifrus Urquart appreciates taking responsibility for his retirement investments, as well as the freedom outsourcing his DIY Super Administration affords him.
posted by X - Men @ 3:40 AM
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