Starting a SMSF is an extremely important decision. Super is the way most Australians save money to retire. Generally, there are three ways to save your super.
The most common is the Australian Prudential Regulation Authority (APRA) regulated super funds in which your super is pooled together with large numbers of other members and the fund is professionally managed by trustees in compliance with super law. (APRA) oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies and most members of the superannuation industry. APRA is funded largely by the industries that it supervises. This is where most people have their employer paid super.
One of the positives of APRA is that there is strength in numbers. One of the biggest negatives of APRA for many is their complete lack of say in what investments APRA makes on their behalf.
Another method is retirement savings accounts wherein you have your own special deposit account with a bank or other deposit-taking institution. RSA providers must be approved by the Australian Prudential Regulation Authority.
Then there are self-managed super funds or SMSFs. When it comes to an SMSF you are responsible and the trustee of your own fund and need to fully comply with super law and make your own investment decisions.
There are many advantages to having a Self Managed Superfund. The most attractive of these for many is the degree of control a SMSF gives them. You choose where, when and how to invest. You also have the ability to change your portfolio at any time. A SMSF also provides a very high degree of investment flexibility. You can pretty much invest in just about anything providing it is allowed by superannuation legislation. Investment opportunities include real estate, shares, bonds, term deposits, even collectibles! The tax benefits of a SMSF are considerable. The maximum income tax rate you pay is 15%. And this amount can be further reduced. Best of all, when in pension mode the fund pays no income tax.
As good as all this sounds (and it does sound good doesn’t it?) it is important to keep in mind that managing a SMSF is not child’s play and those who decide to do so are urged to consult with a professional. When you partner with a company like Royale Capital our team of financial investment and tax law experts reduces the risk of fines and ensures your fund is constantly monitored for issues relating to the compliance of the fund. If you are not an accounting or investment expert or well versed in the many laws governing SMSFs, then you need someone who is.
Not only can Royale Capital guide you through the complicated procedures required in the setting up, managing and maintaining a SMSF, we will also prepare the monthly, quarterly and annual reporting that is legally required and absolutely necessary in the event you are audited. Our financial experts will also help you develop your investment strategy. The main goal of any SMSF is to grow your wealth. The main goal of Royale Capital is to ensure you achieve that goal. If you do not succeed, we do not succeed.
To learn more about all the financial services and educational programs offered by Royale Capital and our Private Wealth program, visit our website at http://www.royalecapital.com.au/ or give one of our expert consultants a call at 1300 924 463.
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Jason Burrows is professional author. He has written many articles for Royal Capital. This time he writes article on The Advantages of A Self Managed Super Fund. For more information visit at: Capital Royale
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