Regulation changes top concern

SMSF regulations

Changes to regulations and rules affecting SMSFs and not the coronavirus present the biggest worry for trustees, new research has revealed.

The latest research into the SMSF sector has shown changes to the rules and regulations which govern it are the source of most concern for trustees despite the presence of the coronavirus pandemic.

A survey Investment Trends conducted online across March and May revealed changes to the regulations and rules regarding SMSFs was easily the number one issue causing SMSF trustee angst, with 51 per cent of the 2470 respondents indicating this is the case.

“Given the timing of the study we were expecting COVID-19 to be a big concern for trustees, however, only 22 per cent [of those surveyed] say that this is actually a worry in relation to their retirement,” Investment Trends research director Recep Peker told attendees at last week’s SMSF Trustee Empowerment Day hosted by selfmanagedsuper’s sister publication, smstrusteenews.

“Instead the bigger concerns they have are regulatory changes in rules around super. {Their thoughts are] we’ve built this substantial nest egg and we want to make sure that it doesn’t get taken away from us if something we’re not expecting happens because of rules and regulation change.”

According to Peker, the result is logical given the mindset of most SMSF trustees.

“This makes sense because it tells us that trustees as a whole have a longer-term view when it comes to how they invest. They know that there can be falls in markets, they know that there can be crashes in the markets and many of them have gone through the GFC (global financial crisis) and other corrections as well, so this sort of uncertainty and volatility only keeps about a fifth of them awake at night,” he said.

Other factors nominated as causing the most angst among SMSF trustees were falls in financial markets (40 per cent), generating income in a low interest rate environment (38 per cent), outliving their retirement savings (24 per cent) and regulatory changes to the government age pension (24 per cent).

With regard to addressing some of these worries, the “2020 Vanguard/Investment Trends SMSF Investor and Planner Report” showed maximising capital growth is a priority for trustees.

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