SMSF trustees are beginning to ramp up their use of outsourcing to professionals, a sign the market is maturing.
According to CoreData research, when asked which activities trustees were personally involved in with their SMSF, monitoring performance and balance had decreased to 68.6 per cent in 2014 from 81.7 per cent in 2012.
Researching new investment opportunities dropped to 53 per cent in 2014 from 64.5 per cent in 2012 and acquiring or divesting investments dropped to 52.4 per cent from 72.8 per cent in the same time frame.
Further, administration and compliance tasks dropped to 43.4 per cent in 2014 from 56.1 per cent in 2012.
“But the number of people who are outsourcing all of their SMSF tasks has started to jump – it bobbed up for the first time this year at 11.5 per cent of people who answered this survey, who said ‘I don’t do anything, I outsource the entire thing to professionals’,” CoreData principal Andrew Inwood told the selfmanagedsuper/CoreData SMSF Accountants’ Day in Sydney last week.
“This is the sign of a maturing market.
“It means that you’re no longer getting the hobbyist SMSF person who really wants to do everything themselves.”
Inwood said the trend of SMSFs outsourcing to service providers would only intensify and those providers who stepped in now would gain a huge advantage.
“Every single bit of data that I have suggests that’s going to increase quite aggressively over time,” he said.
“There’s also a correlated point to this, which is the more they outsource this, the higher their satisfaction rose.
“And not only that, the more the outsourcing is given to someone who isn’t behaving like a fund manager, but is behaving as an administrator, the more their satisfaction with that provider grows because the provider puts more energy into managing the relationship than they do towards managing the fund.”
