Why invest in superannuation?

Advantages of investing in assets in the superannuation environment include:

  • Concessional tax treatment
  • Ideal form of savings for retirement
  • Insurance benefits can be attached
  • Government co-contributions incentive. Superannuation exists to help you provide for yourself in retirement rather than relying on social security. As a result, your superannuation savings cannot be accessed until a condition of release is met, such as retirement or reaching age 65.

How can superannuation be accessed?

Preserved and restricted non-preserved benefits can be accessed in the following circumstances:

  • Attaining the age of 65
  • Retirement
  • Termination of gainful employment after 1 July 1997
  • Permanent incapacity – where the trustee is reasonable satisfied that the member is unlikely, because of ill health, to engage in gainful employment for which they are reasonably qualified by education, training or experience.
  • Death
  • Terminal illness
  • Compassionate Grounds
  • Severe financial hardship
  • Temporarily incapacity – a superannuation may provide an income stream to a member as a temporary incapacity benefit
  • Transition to retirement
  • Temporary resident departing Australia permanently

What is an Self-Managed Super Fund?

An SMSF is a trust where money or assets are held and managed on behalf of up to four members to provide benefits for their retirement. Subject to certain exceptions, all members of an SMSF must be trustees of the SMSF or directors of the SMSF’s corporate trustee.

Why establish an SMSF?

Three key reasons for establishing your own SMSF are control, flexibility and investment choice. As trustee of your fund, you decide on your fund’s investment strategy and choose how your fund’s assets are invested. This means you can tailor your fund’s investments to suit members’ specific needs. Your fund can invest in most asset classes, although there are some limitations and legal restrictions. Like all super funds, an SMSF receives concessional tax treatment. The top tax rate for the investment earnings of your SMSF is 15%. It’s important to note that this tax concession is only available if your fund complies with all the rules and regulations.