There are clear opportunities to reap from the incoming super legislation, but advisers and accountants who use a “work smarter, not harder” approach to the changes will be the clear winners, an SMSF expert has said.
“How many of you feel like you are ready to capitalise on the opportunity?” The SMSF Academy managing director Aaron Dunn told the SMSF Association 2017 National Conference in Melbourne today.
“What we need to understand here is that the approach we’re actually going to take over the next 135 days – yes, that’s all we have from now until 30 June – and the to-do list of what we need to get done is quite substantial.
“Therefore the approach that we need to take over the coming months and then throughout the rest of the year, and then beyond that, is going to change ultimately how we’ve previously done our work.”
Dunn said the super changes had created a pivotal point for the SMSF industry and the situation was a once in a decade opportunity to capitalise on the work practitioners were doing with their SMSF clients.
“Working smarter is going to be the most critical piece to the success that you have over the coming 135 days and counting,” he said, adding that using the tools already available in the market was crucial.
“We have seen, over the journey, the efficiency gains and discussions about technology, but in my view [the super changes] will be the catalyst from early-adopter and early-majority stages with the cloud to the majority.
“A third of SMSFs are on cloud-based solutions. I would predict that will exponentially increase in the next two or three years.
“It is all about the turtle on the skateboard – he’s found a way to get from point A to point B.”
He referred to insights from a new SMSF Association/Commonwealth Bank of Australia report, slated to be released in April, which revealed 60 per cent of funds considered themselves unadvised, highlighting a significant gap in the need for advice.
“Amongst retired SMSF trustees, those that are advised are more likely to feel they fully achieved their retirement goals, even though those not yet retired show little difference in their view of whether they are on track to meet their goals across advised and non-advised, that is, advice makes a difference to the actual outcomes, even if non-advised SMSFs display overconfidence in their ability to meet their goals,” the report said.
Dunn said that finding demonstrated an opportunity for advisers to think about how to get relevant information to their clients in a timely way, which in turn could also result in new clients.
A poll of delegates in the room showed 43 per cent believed the implementation of the changes required to comply with the new super rules was the greatest challenge out of the reforms.
That was followed by 20 per cent indicating preparation of client advice was the greatest challenge, while 14 per cent said it was the timing to have information ready to assess circumstances.