Recent Investment Trends research into the sector has shown the desire for control over their retirement savings as the main motivating factor for people to establish an SMSF is strengthening.
Further, the citing of advice from an accountant or direction from a financial adviser as a reason to set up an SMSF has fallen significantly over the past four years.
To that end, 19 per cent of trustees indicated advice from an accountant was a critical element in their decision to establish an SMSF between 2015 and 2019, while only 6 per cent expressed the same sentiment between 2020 and 2023.
With regard to recommendations from financial advisers, in the period spanning 2015 to 2019, 12 per cent of trustees revealed this influenced them to start an SMSF, while in the years covering 2020 and 2023, only 1 per cent of trustees said this was the case.
Investment Trends head of research Dr Irene Guiamatsia noted the difference this will make in the relationship between SMSF members and the practitioners servicing them.
“Let’s not construe that to mean that they are [reducing their use of accountants and financial advisers]. In fact, they are increasing the importance [of using these practitioners],” Guiamatsia suggested to delegates at Class Ignite 2023 held recently in Sydney.
“The reason why I called this out, even though we know that for SMSFs the use of financial advisers is going to be increasingly important … is actually just to highlight the fact that the desire for control is actually going to be a sharper need for those [trustees] who work with an accountant because it is a lot more of a driver and motive for them than it used to be [with] previous generations.”
As control is becoming of greater importance to SMSF trustees, she took the opportunity to clarify what this concept actually means to this cohort.
“What they said it means is ‘I want to be in the driving seat, I want to choose the investments [of the fund] myself’,” she confirmed.
“So [from an adviser’s perspective] in supporting the portfolio allocations [of trustees] it is important to really listen and collaborate and actually let the trustees be in that driving seat.”
