You are currently on:

SMSF Basics: What are the benefits of having an SMSF?

Mar 25, 2022, 12:49 PM

By Graeme Colley
Executive Manager, SMSF Technical & Private Wealth


Every kind of superannuation fund has its own advantages, but a self-managed superannuation fund (SMSF) provides some unique advantages worth considering. If you’re the type of person who likes to have a say in their future, an SMSF may be right for you.  You have the right to choose the fund’s investments and manage your super savings because it’s your super fund. Here are the reasons for having an SMSF:

Investment control

An SMSF can allow you to invest in a wide range of local and overseas assets, including:

• shares in public and private companies,
• listed and unlisted unit trusts,
• cash and term deposits,
• commercial and residential real estate either directly or indirectly,
• managed portfolios. and
• boutique investments such as artworks, bullion and cryptocurrency.

It’s possible for an SMSF to borrow, providing you follow the rules, to give your fund access to the advantages of gearing. As a small business owner, your SMSF may wish to hold your business premises for various reasons, including asset protection, estate planning, and security of tenancy.

Greater investment timing and flexibility

SMSF’s give you control over the timing of the fund’s investments so they can be bought or sold when you think it’s right. A hands-on approach can mean a quick response to adjust the fund’s portfolio due to sudden changes in local or international investment markets.

Creating an investment pool

Another benefit to an SMSF is that it is possible to pool your superannuation savings with other members to provide the fund with access to investment opportunities that may not be available elsewhere. An SMSF is allowed to have up to six members, which may provide access to wholesale investments and the benefits of being a sophisticated investor.

Effective tax management

Because superannuation is a tax-advantaged structure and you can exercise greater control over the fund investment decisions, it may allow you to manage the fund’s tax position better. The taxable income of an SMSF is usually 15%, but the income received on investments supporting a pension in the retirement phase is tax-exempt.


Estate planning

Superannuation has always provided estate planning benefits, but SMSFs offer greater flexibility with a member’s estate planning needs. An SMSF provides members with the advantage of non-lapsing binding death benefit nominations. Other funds may be restricted to death benefit nominations that require updating every three years or earlier. Also, SMSF members may have greater flexibility in specifying how death benefits are to be paid in cash or by transferring the fund’s investments.

Your Responsibility with an SMSF

To take advantage of having an SMSF and their benefits, you need to comply with strict laws and regulations. You will be a trustee of your SMSF, which means that you are responsible for all decisions made about the fund. This includes being accountable for the investment decisions and ensuring the SMSF complies with the superannuation and taxation laws. Before you take the next step to start an SMSF, make sure it’s right for you.

Want more free SMSF knowledge? 

MicrosoftTeams-image (17)
For fortnightly insights, follow our podcast SMSF Adventures with SuperConcepts hosted by Jessica Griffith as she speaks to some of the greatest minds in the industry, to deliver the information that matters.

Follow the show on Spotify or Apple Podcast.

To learn more about how our range of SMSF services phone us on 1300 023 170 or request a call back

Alternatively click through to view our range of services for trusteesaccountants and advisers.