SMSF: Balance Risk and Returns and Build a Great Retirement Portfolio

All of us need to plan ahead in order to have a great future and the best way to ensure that is to set up an SMSF (self managed super fund). You might be wondering what SMSF is or why it has gained so much popularity over the last few years. Well, keep reading as to find out how you can benefit from an amazing retirement plan by balancing risk and returns.

Something you should keep in mind, even before starting the fund, is that you will need a lot of help. The SMSF can include up to four members, which are also the trustees. This means that all of you are responsible for the consequences of your actions involving the SMSF. However, you shouldn’t be discouraged by this, you can always hire professionals when it comes to managing your fund. In order to ensure hat everything runs as smoothly as possible, you will need an auditor, an actuary, valuers and SMSF accountants.

An ASIC registered SMSF auditor is a requirement for anyone running their own fund. They will audit your funds annually and report back to you any issues they might have found. All issues must be quickly resolved. Actuaries are needed for some circumstances when they need to provide you with a certificate in order to determine your tax benefit.

Everything you own must be put under evaluation annually, however, it is even better to hire independent valuers to take a look at your assets, just to keep your own record. Financial accounts and statements must be prepared to meet the accounting standards each year before the fund is audited – this is a tedious task, so you’ll be better off hiring professional SMSF accountants.

Now that we have mentioned everything you need for setting up your own super fund, let’s talk about a few benefits you can get out of it. One of the biggest advantages of an SMSF is that you control it (as its name states), or if you choose to start a fund with other members, all of you are the trustees and all of you run it. Also, this is the most verastile type of fund which makes it easier for everyone to adjust it to their needs. As aforemenationed, you can have up to four members managing the fund, and this is a huge advantage since more people means more resources. Finally, the four individuals investment pool, the members of which are usually related, offers investing options which would be far fetched for a single individual.