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New SMSF appropriateness tool unveiled

Ignition Wealth today announced the launch of a software technology solution that automates the process of assessing clients’ suitability to establish an SMSF, reducing the time and cost involved for practitioners.

The SMSF Appropriateness tool, available from 1 August, will also assist clients to learn about the key responsibilities and issues associated with becoming an SMSF trustee as they read and complete each step.

The tool considers the client’s responses through a comprehensive, easy-to-follow fact find, as well as a learning centre where they are required to engage with information about SMSFs and trustee obligations.

It then makes a recommendation in a statement of advice and includes a meeting with an online adviser from Ignition Wealth’s advice team.

“This is not a system that’s trying to get as many people through [to establishing an SMSF] and we’re not selling SMSF packages – it’s about what’s in their best interest and so they shouldn’t start up an SMSF if it’s not right,” Ignition Wealth chief executive Mark Fordree told selfmanagedsuper.

“This is also a way to address the accountants’ exemption by allowing accountants to retain their SMSF clients and making sure they have a compliant outcome.

“Accountants have full visibility so they can log in and oversee their clients’ profiles and see and check which clients have gone through the SMSF appropriateness process, so they’re not handing them over to someone else and therefore retaining the client relationship.”

When it came to the more detailed trustee responsibilities section of the process, Fordree highlighted that no shortcuts were taken.

“It’s not in our interest to make it overly complex, but we had to make sure that it covered everything, so there are no shortcuts and it is comprehensive,” he said.

“We’re now working on lifting the awareness of the availability of the tool and we’re getting quite a good response from accountants who we’ve spoken to directly.”

Ignition Wealth head of sales and marketing Richard Liverpool added that as the Australian Securities and Investments Commission increased its scrutiny in this area, the accountancy market had been urgently seeking a compliant solution for clients seeking SMSF appropriateness guidance.

“When it came to the design of the tool, at every level, clients are made aware of their trustee responsibilities,” Liverpool said.

“I don’t think that we should apologise that it is lengthy because it is such an important aspect and there is so much to consider here.

“We want clients to realise that they have to be responsible for their own actions and that it is a big step for someone to start an SMSF, so these areas are specifically detailed.”

The cost of using the tool for a full assessment, including the meeting with an adviser, is $770 including GST.

Additional advice can be provided by the client’s own adviser or by the Ignition Wealth team at an additional cost.

Ignition Wealth also offers SMSF portfolios should the investor desire an investment solution.

The firm holds its own Australian financial services licence.

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