Financial awareness among working individuals of Australia has increased over the past years. From trusting financial experts to retail institutions, a majority of people are more interested in having greater independence to manage their finances. An important practice in Australia is superannuation. It is an organisational practice where employed individuals make regular fund deposits in a superannuation account until their retirement or withdrawal.
In the current market scenario, which is highly unstable and prone to sudden changes, anyone would want to have the independence to managing their retirement funds. Moreover, people equipped with knowledge in finance management have an added advantage to reap greater benefits in comparison to other plans offered by investment agencies.
A Do-It-Yourself or Self-Managed Superannuation Fund is plan opted by an individual where they are in total control of their retirement funds. They enjoy numerous benefits and perform duties to manage their resources to derive maximum profit. However, establishing SMSF is not that simple for an ordinary person with having minimal knowledge of how it works and what protocols to follow.
The Australian Tax Office is a regulatory body that governs over self-managed superannuation funds. It means members in an SMSF have work in compliance with the rules and regulation established by this governing body.
Moreover, one ought to know all necessary characteristics of setting up SMSF. For instance, how many members are allowed in a plan and how to manage funds effectively? As a member in an SMSF, one should be aware of their rights as well as duties that are to be performed.
Do It Yourself, or self-managed superannuation plan is a preference among individuals working in any sector or industry. This popularity is largely based on the number of benefits a self-managed superannuation fund has to offer.
Below are the advantages of establishing an SMSF.
* Increased control over one’s investment decisions
* Individuals interested in real estate have the freedom to make an SMSF property investment to enjoy high rewards during retirement stage.
* Other investment sectors include cash, shares, or other assets that suit individual investment objectives of a member
* Cost-benefit: SMSF is comparatively less expensive to manage and operate in comparison to other large industry or retail funds available in the market.
* Other advantages include SMSF borrowing, tax benefit, and asset protection.
Individuals with limited knowledge of finance can hire an SMSF auditor. The auditor will assist in establishing, administration, and compliance of a fund with rules and regulation of governing body. Performing regular audits and transfer of existing superannuation fund is also shared services among expert SMSF specialists.