The Many Benefits of a Self Managed Super Fund

We have seen a massive increase in the number of Self-Managed Superannuation Funds or SMSF in the country during the last few years. Statistics from the financial market show that self-managed super funds now account for almost 99 per cent of all super funds within Australia. The total number of super funds grew from 440,094 in 2011 to over 600,000 until last year.

Data from the Australian Taxation office also found out that self-managed super funds are now responsible for 622 billion in the kitty, which is almost 30 per cent of the total assets held in supermarkets over the country.

What is a Self Managed Super Fund?

A self-managed superannuation fund is basically a do-it-yourself superannuation fund that comprises of 1 to 4 members in each group. Each member acts as a trustee within the fund. All trustees have to be members, while all members should be trustees. It is also possible to have a single member fund managed by just two trustees or one corporate trustee.

An SMSF requires a bank account of its own, along with a trust deed. The deed sets down the rules of the operation, along with who can be a member of the fund, with directions on the process required for admitting new members. The deed should also put down a clause for what the fund can invest in and members that receive death benefits. The SMSF requires annual auditing, along with regular tax returns.

Many people shy away from investing in their own SMSF because they aren’t aware of the benefits such a fund carries. In this article, we discuss the many benefits of a self managed super fund and the different variables that go into play. By the end of this article, you should be able to initiate your fund and manage the requirements that come with one.

Benefits of an SMSF

There are a number of key benefits associated with managing your own SMSF. Obviously, you can turn to experienced pros for getting advice on your self-managed super fund, but most of the requirements are managed and met at your end.

Investment Choice

Self managed super funds can open a range of investment options for users to invest in. Trustees on a self managed super fund have access to high-yielding cash accounts, direct shares, income investments, term deposits, unlisted assets, international markets, direct property, collectibles and a lot more. This diversity allows individuals to spread their eggs across multiple baskets and benefit as a result.

Tax Strategies

Just like many other super funds, SMSFs allow all trustees to benefit from a concession in tax rate as well. During the accumulation phase of an SMSF, the tax on all investments made is capped at just 15 per cent. However, when the fund moves to a pension phase, there is no tax on it, not even the capital gains tax. Tax strategies allow individuals to grow their super savings and reduce their tax payments as a result. People can then transition towards retirement in a smooth manner.


Flexibility is perhaps the greatest benefit of a self managed super fund. Self managed super funds allow users to run multiple pension and accumulation accounts across each phase of the process. Trustees on the fund can enjoy the flexibility and set their investment mix in whatever manner appeases them.

The flexibility in investment options allows users to set their pace and investment options in accordance with the market conditions. The personal circumstances, super rules and other factors determine the success and longevity of the fund.


Self managed super funds boast of amazing transparency, which allows trustees to set their investment decisions in line with the personal goals they have in mind.

Regardless of whether you are passionate about shares, sustainable investing, ethics or property, you can set your fund in line with these preferences. Self managed super funds give you the transparency to know just where your money is invested and the tax treatment and performance of your income.


All trustees within an SMSF are required to lodge an annual tax return with a proper audit and pay the ATO fees that come with the account. Remember that your SMSF will become more cost-effective with time as it grows further. The total cost of running the account will depend on the cost of the professional support and advice you get.

There are multiple benefits of setting up a self managed super fund, and we have discussed them all in detail here. We hope you know more about the super fund account now and can think of initiating one.

This article is for information and educational purposes only and does not form a recommendation to invest or otherwise. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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