Self Managed Super Funds now largest and fastest growing segment of super industry – and most cost-effective
With investors abandoning retail and commercial super funds in the wake of the Global Financial Crisis and volatile stock markets, Self Managed Super Funds are quickly becoming one of the fastest growing sectors, with over 478,000 already established, according to the Australian Taxation Office.
Self Managed Super Funds are now the largest and fastest growing segment of the super industry, with the ATO predicting that within the next two years 1 million Australians will have a Self Managed Super Fund. Of particular note, with an increasing number of financially independent women in the work force developing their careers, women between 25 and 54 years of age are establishing their own Self Managed Super Fund and are a larger percentage in these age groups than the percentage of men starting one.
ATO statistics show that Self Managed Super Fund members are also paying the lowest super fund fees across the industry. Having experienced a downward trend since 2008, Self Managed Super Fund compliance fees compare very favourably with competing retail and industry fund sectors (being 2.1 per cent for retail funds and 1.1 per cent for industry funds). This is a welcome trend for Self Managed Super Funds and confirmation they are becoming more competitive with other superannuation sectors in terms of fees.
When it comes to super, most Australians make no active choice. The majority have their super automatically paid into the default investment option of their employer’s super fund. However over the past five financial years the Global Financial Crisis has driven every dollar invested in these default funds backwards by 0.3 per cent a year, according to data from SelectingSuper. Of the 83 default super options available over the five years, 51 delivered negative returns (6,066,129 member accounts) and 32 delivered positive returns (10,179,634 member accounts).
At The Quinn Group our experienced team of Financial Planners, Accountants and Lawyers can assist you with all your investment strategies. For more advice about the benefits of owning a Self Managed Super Fund, contact the Financial Planners at Quinns by submitting an online enquiry or calling us on (02) 9580 9166 to book an appointment.