SMSF is lucrative for various reasons. Among them, flexibility, control and cost are certainly on the top of the minds of investors. This said, once SMSF investors set up a fund, it is not unheard of that they give up a part of their management control or end up paying a big amount in administration fees. This is where apps have been coming handy of late.
You might not be in a position to manage your self-managed super fund any more. Contrarily, you may have found it more practicable to move to foreign shores for two years or more. If such be the cases, you may find it very difficult to keep running your SMSF. Here are options you might consider.
A case that has recently come within public scrutiny deals with the binding death benefit nomination. It talks about how the present trustees (adult daughters) and former trustee (second wife) are battling over the estate and coming to grips with the exorbitant legal bills.
Auditors of Super funds report various SMSF contraventions to the ATO. Among them, breach of the arm’s length rule and unlawful separation of the personal asset-SMSF asset feature prominently. Super specialists feel that those SMSF owners who also own SMEs are more prone to making ‘ATO’ mistakes.
There is no denying the merits of an SMSF enterprise. They offer typically greater control and flexibility over your investments. However, they are not easy to maintain and can ask for your time, money and knowledge. Further, prudential regulations do not apply to the SMSF sector and hence you will be in a vulnerable place if someone defrauds you.
Though there has been no reduction in the interest rates in the first week of June, the historically low interest rates imply that the share market might provide your excess capital a safe landing. The Dividend Franking system ensures that the returns posted by the small and big players are substantial and perhaps (tongue in cheek) more lucrative than the property market. This is arguable territory. After all, Australian real estate has provided nearly 12% of GDP (biggest contributor) in the year gone by.
The Financial Inquiry Report has come as a jolt to the real estate aspirations of SMSF owners. It is in fact a little defeating to think about the changes that may enter the domain of the Limited Recourse Borrowing Arrangements. While SMSF owners cannot do much about the alterations that occur at this level, they can certainly make a few modifications in the way they pursue their SMSF properties.