Sent: 22-02-2011 14:10:53
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New SMSF Survey
Yesterday the SMSF Professional Association in conjunction with Russell Investments launched their inaugural study into the Self Managed Super Fund sector.
It's fascinating research and appears to be the first time that any organisation has really tried to get to the bottom of what motivates SMSF trustees.
In truth I have been waiting many years for someone to do research of this type and the two organizations deserve great thanks for stepping up to the plate and giving this big task a go.
The report confirms that SMSFs are a robust superannuation sector. It paints a picture of a potential market which can grow much larger given that there is currently low penetration in some key market segments that might typically be interested in SMSFs.
There is no question that this potential size of the SMSF market - which I have never seen expressed in this way - might give a lot of fund managers and other product providers eg Industry Funds reasons to think carefully.
Also of interest is that SMSF trustees seem to belong to the cohort that wants to work longer. As the full report notes, "Perhaps by doing more to encourage and support the SMSF sector, the Government may also be encouraging more people to stay in the workforce longer."
Only a minority of SMSF trustee respondents were interested in super gearing. It appears to have about 25% of trustees have either actioned or may action this type of transaction. At present this means about 100,000 funds. If they all borrowed say $200,000 then this is about $20b of new loans.
Regrettably I can still the potential for super gearing to create the same problems as margin lendings recent problems. The government would do everyone a favour if they insisted that the maximum LVR was 50% for every super gearing arrangement.
About 14% of trustee respondents to the survey say they pay their adviser a percentage of assets under management. However less than 5% of respondents want to pay by this method. This area of the survey does nothing to assist the anti-opt-in campaign that is being waged at present.
Fifty percent of trustee respondents had household income of less than $100,000 (only 26.6% were retired). This confirms data produced by the ATO from it's records that SMSFs are not the preserve of upper middle wealth and above but from moderate middle wealth and above.
There's lots more in this survey. I would strongly encourage you to download it from http://www.atcbiz.com.au/r.php?r=66xmq0b
Finally please consider purchasing a copy of "A How To Book Of Self Managed Super Funds". You can look at the contents page at the following link: http://www.atcbiz.com.au/r.php?r=0mjd6ne
The 4th edition was released just before Christmas.
For details of the changes made from version 3 to version 4 visit:
As you'll see from the list there have been many changes.
Two purchase options are available - once only subscription - $55 inc GST - or an annual subscription will gives you access to all the updates made throughout the year ($120 inc GST). The book can be purchased at the following link: http://www.atcbiz.com.au/r.php?r=5a4agqb
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