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Advice value-add evident

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One specific area where financial advice can add value for SMSF trustees has been identified by the latest quantitative research into the sector.

The latest research into the SMSF sector has identified the ability of advisers to keep trustees up to date with legislative and regulatory changes as the one specific area where financial advice is making a noticeable difference.

The “Vanguard/Investment Trends SMSF Report” for 2022 surveyed two groups of trustees separately – those who currently receive financial advice and those who currently do not – and both groups identified this issue as the one where advisers can add most value.

“[For] the 160,000 respondents who are using an adviser, we asked them what [else] can this adviser that you’re already using … do to better educate you and inform you. [The research showed] there are a whole long list of things that SMSF [trustees] would really like to be educated on, but chief among those is updates in rules and regulations,” Investment Trends head of research Irene Guiamatsia noted at the release of the study in Sydney yesterday.

“So that comes out really strongly and it has increased from last year.

“If we look at the 240,000-odd [trustees] who are not using an adviser, they express some needs that are not met … but the most cited option again is changes in regulation.”

Among the SMSF members receiving advice, around 38 per cent also indicated they needed additional assistance with the fund investment strategy, while another 30 per cent selected estate planning as an issue they are still seeing as a challenge.

The cohort of trustees not receiving advice recognised three other issues, almost equally in importance, they could better manage if they were to see an adviser. These were inheritance and estate planning, pension strategies and tax planning.

The survey for the “Vanguard/Investment Trends SMSF Report” was conducted online between March and April, with the research compiling and analysing responses from 2430 SMSFs.

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