A
self-managed superannuation fund, or SMSF, is one of the nest eggs those with a
keen financial sense and strong work ethic aim for. One of the chief advantages
of the SMSF is that it helps expand your investment options. It will also
shepherd all the money you need for your retirement. However, while SMSFs are a
growing industry among Australians, some experts stress that activating one
requires a lot of homework.
You
can set things going by establishing a trust deed with help of a licenced
accountant and wealth specialist.
The deed will outline the fund’s trustees, the governing by-laws, and
contribution amounts each member should turn in. Trustees should be at least 18
years old and have no prior convictions.
At
the same time, you should also apply for a tax filing number and an Australian
business number, plus elect for regulation with the Tax Office under the
Superannuation Industry (Supervision) Act (SISA). Once the SMSF is regulated,
work with your adviser in drafting its investment strategy, which will include
factors such as asset risk, cash flow, potential liabilities, and returns.
Some
experts claim that SMSFs should have no less than $200,000 in the kitty as
there are administrative costs to consider. Running your own SMSF can be tricky
especially if you are pressed for time to do so. As such, you can turn to
wealth strategists to help maximise your investment potential.