The Little-Known Advantages Of Self Managed Super Funds

Posted on: 8 February 2023

Self Managed Super Funds (SMSF) are becoming increasingly popular in Australia as a way for people to take control of their own retirement savings. With an SMSF, individuals have the ability to manage their own investments and have greater control over the types of assets they hold. While many people are aware of the benefits of SMSFs, there are also several lesser-known advantages that make them an attractive option in ways you might not expect at first. If you are considering switching to an SMSF then here are a few of those hidden benefits that may just make your life easier.

Save Money On Tax 

Self-managed super funds offer a range of tax benefits that are not available with traditional superannuation funds. One of the most significant benefits is the ability to pay lower taxes on investments, as SMSFs are taxed at a lower rate than other forms of investment. Additionally, members of SMSFs are also eligible for tax concessions and rebates that can reduce their tax bill even further. The government wants to encourage increased super and this is one incentive that you can gain a lot out of when switching to a self-managed super fund that many do not realise.

More Cost-Effective When You Know What You Are Doing

Self-managed super funds can also be more cost effective than traditional superannuation funds. This is because SMSFs have lower fees and charges, which can help to increase returns over time. Additionally, SMSFs also have the ability to negotiate better deals on investments, as they have more control over the types of investments they make. Of course, this does require a bit more input from yourself, but considering the potential for savings both immediately and in the long term, it is hard to deny that this is quite an attractive feature.

Potential For Much Greater Returns

One of the central reasons that many financial analysts and people in the industry utilize self-managed super funds is that you can get so much more bang for your buck than traditional super funds. This is because SMSFs are able to invest in a wider range of assets, including property, direct shares, and alternative investments. By having a greater variety of investments, SMSFs can diversify their portfolios and reduce the overall risk. It also allows those who can recognise the signs and trends in the market to be more proactive with their investments. It should be noted that this also comes with more potential for risk, but this can be mitigated through the aforementioned diversification of your portfolio. 

Find out more about self-managed super funds.