Managing your super fund successfully
An academic is issuing a warning for Australian investors to take care ahead of managing their own superannuation fund and is providing access to a free online course on how establish a SMSF.
Professor in Finance, Adam Steen from Charles Sturt University (CSU) School of Accounting and Finance has noted a dramatic increase in self-managed superannuation funds (SMSFs) in recent years, and increasing concerns in the superannuation sector.
"According to the Australian Tax Office (ATO), there are over half a million self-managed funds operating with around one million Australians investing in them.
"With assets held in Australian superannuation now around $1.6 trillion, SMSFs manage one third or $600 billion worth of these assets," Professor Steen said.
The CSU academic believes this growth in self-managed superannuation funds is because they are appealing to Australians disillusioned with traditional superannuation funds.
"They believe these funds are not earning as much as they could, they consider fund managers' fees are too high, and they want to be in control of their own destiny," he said.
However, Professor Steen is concerned that there are major pitfalls in SMSFs where fund trustees have little or no idea about their obligations as trustees.
"People must not assume that their tax agent or accountant are totally responsible for the operation and reporting of their funds.
“However, trustees should understand that while many advisors and tax agents ensure that trustees meet their obligations, it is the trustee that is accountable for fulfilling reporting obligations.
"Furthermore, problems arise when trustees invest in or transacting with related parties, for example by providing loans to relatives. Such loans are prohibited under Australian law."
According to Professor Steen, the superannuation sector is heavily regulated by the ATO, and the numbers of funds breaching their statutory obligations are relatively few.
With these and another potential problems in mind, Professor Steen is running a free online course, An Introduction to Self-Managed Superannuation Funds.
The short course, or MOOC (Massive Online Open Course), introduces the basics of how to establish a SMSF, the legal requirements and research on the funds, and the essential skills needed to successfully operate them.
The course is presented in a series of online modules that can be competed over four weeks. Learning material is supported by an online discussion forum.
While the course is free, due to demand all participants are required to register. The course commences on Monday 19 September 2016.
12 September 2016.