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If you want greater control over the money that you are retiring on, consider DIY super. There are a number of companies that can assist you in administering the investment of your hard-earned super. Be aware that you will not be able to access your super any earlier by managing it yourself and must still comply with all tax laws. All DIY super funds are regulated by the ATO, and may be audited.
Superannuation Australia, the ATO and DIY super
Superannuation Australia, under the umbrella of Taxpayers Australia, offers advice and advocacy to the government for those who wish to DIY their super. They publish a quarterly DIY superannuation manual, which offers advice on areas such as advantages and disadvantages of managing your own fund, tax issues, reasonable benefit limits, and strategies to manage your fund. The cost of this is $176.00.
The Australian Taxation Office (ATO) has published a booklet to guide you on laws regarding tax compliance for super funds. It also offers advice on DIY super to help you avoid falling foul of the taxation system if you choose to administer your own super.
Advantages and disadvantages of DIY super
Pros
- The advantage of doing so is clear - you don't have to sit back and hope that your fund manager is doing the right thing with your money; you control where and when it is invested.
Cons
- You will need to pay for its administration, but this may be offset on tax
- You will need to be appraised of the most up to date laws on self-managed superannuation funds, as many have recently changed
- You will need to be appraised of the most appropriate investment options
- It is risky; the uninformed may risk losing some of this vital resource. The ATO is currently scrutinising DIY super and tightening regulations.
Self-managed super funds - is it for you?
DIY Super is best suited to retirees who wish to take a more active role in the management of their assets, or to families with a maximum of four members who may gain fee advantages in a self-managed super fund.
You can manage your own super with greatest ease by using a supported system, offered by many financial institutions. These will help you to navigate laws, rules, costs and pitfalls, while still allowing you greater input into this important investment.
DIY super fund providers
One such manager is Super Easy. They offer a range of packages, starting from Self Managed Super Fund (SMSF), at $345*, to more comprehensive management and advice services at about $1,500*. Other self-managed funds are offered through RaboPlus and Superhelp.
Take time in deciding whether DIY super is right for you. Ensure that all tax and legal bases are covered, seek out some sound investment advice and you could reap the rewards of managing your own retirement income.
*Prices subject to change. Please contact provider.
