In an article for the website Money Management, Jason Spits talks about ATO’s effort in busting the myth that says the SMSF industry is getting inclined towards the younger trustees. Had this been the case, contests Spits, the number of funds holding $150,000 or less would not have declined over the last 4 years. After all, these are the funds held largely by the younger trustees.
SPAA does not favour young investors
To put things in perspective, Spits offers a couple of statistics. Firstly, the percentage of SMSFs holding $150,000 or less dropped from 20.5% to 17.2% over the last 4 years – quite an unhealthy drop! Secondly (and for the sake of better perspective), during the same time, the fortunes of funds between $200,000 and $2 million rose from 63.9% to 65.7%.
Of course, the stats do not mean by a long shot that the SPAA is against young people entering the SMSF industry. It is just that any claim in regards to the SPAA encouraging younger investors more than other investors is unfounded.
The residential investment claim was unfounded, too
Moreover, the SPAA asserts that these young investors take up a very small portion of the fund amount invested in residential properties. Again, to validate things through stats, less than 1% of trustees having less than $650,000 in their funds have residential property investments.
You can read the original article here.
In fact, it is pretty clear that some of the claims made by SMSF detractors about the industry pouring out a lot of money into residential investments is also false and baseless. Average weighting of residential properties being 4.3% of the overall SMSF pool is quite a testimony to this.