Is a Self-Managed Super Fund the way forward in 2022? An increase in inflation has people on edge as they wait for the RBA to decide on whether interest rates will follow suit. Economists believe there’s no reason to panic, but if you were planning to use a Self-Managed Super Fund this year to secure your financial future, now is the time to make your move. If the experts are wrong and there is an interest hike and property prices continue to spiral, waiting could be detrimental.

As one of your largest financial assists Superannuation, it’s only natural to want to safeguard these savings. However, to use these funds for property investment, you must have a Self-Managed Super Fund (SMSF). With great rewards comes great responsibility and risks and before you decide self-managed is your fast-track to financial independence, make sure you read the article to the end. There is a lot of information to digest, so you may want to seek out support in helping you make the right decision based on your circumstances. At National Wealth Advisory, our job is to connect you with the experts you need.

The advantages of choosing a Self-Managed Super Fund

Control over your money

You get to make the decisions! Unlike retail or industry super funds, which restrict the amount of control you have over your investment strategy and make decisions that benefit all members, the trustees of the SMSF can develop and implement an investment strategy that suits their specific needs. National Wealth Advisory can connect you with specialists who can liaise with trustees to ensure investment plans are robust and take the current economic climate into consideration.

Choice and flexibility

When you opt to manage your own superannuation, it opens up a diverse range of investments options that may not be available in retail or industry super funds. For example; you may be able to invest in residential or commercial property, as long as you don’t live in it. You can invest in shares or even put your money in a term deposit. What’s more, it allows you to make changes when it suits such as interest rate hikes, personal circumstances, or superannuation laws

Lower cost

Depending on how much professional support you require, self-managed funds generally become more cost-effective to run as they grow. With large super balances, it’s important to seek independent advice to minimize tax implications.

The disadvantages of SMSF

Lack of experience and time

As a trustee, your role can be a time-consuming one.  Not only will you have to research your decisions, but there are ever-changing legal responsibilities to ensure the fund complies with complex tax and superannuation laws. A significant amount of financial literacy and legal knowledge is required to effectively manage your SMSF. Often it’s a skillset requiring years of education and financial know-how. Fortunately, at National Wealth Advisory, we can connect you with experts who are well-versed in the legalities, making the entire process a lot less stressful and time-consuming.

Superannuation scams

The last couple of years have seen an extraordinary increase in scams, and their technological sophistication is making it harder to identify legitimate investment opportunities. In 2020, Scamwatch reported that Australians lost over $65 million to investment scams, with those in the age category of 45 years and older experiencing the most financial loss. Furthermore, those who don’t seek help from a financial advisory expert are more likely to experience financial loss as a result of theft or fraud.

Let’s talk it over

As you’ve discovered, SMSF can be a minefield but one with huge rewards if navigated correctly. Before you decide that a self-managed super fund is right for you, make an appointment with National Wealth Advisory.  We can connect you with experts that can alert you to the pros and cons, help you set it up if you’re eligible, and also guide you through the process of purchasing property with your superannuation.

Contact us today!