SMSF, Superannuation

Trustee establishment age rises

SMSF trustee establishment

The average age of Australians setting up an SMSF has increased along with the average superannuation balance of these new funds.

Both the average trustee age and superannuation balance for individuals establishing SMSFs in 2023 has increased, reversing a noticeable trend recognised during the COVID-19 pandemic, the most recent sector research has shown.

“So the demographic of the SMSF investor is certainly evolving [and] in this past reporting period slightly older trustees with larger finances are setting up new funds,” Investment Trends head of research Dr Irene Guiamatsia noted.

To this end, the “Vanguard/Investment Trends 2023 Self Managed Super Fund Report” revealed a person who established an SMSF during the year was on average aged 45 and had a retirement savings balance of $300,000.

In comparison, during 2022 the average age of an individual who set up an SMSF was 42 and had an accumulated superannuation balance of $220,000.

According to Guiamatsia, the analysis examined these statistics to specifically measure the impact of any newly introduced regulatory parameters or guidance.

“There were hypotheses we were looking to explore around the impact of [Australian Securities and Investments Commission] INFO (Information Sheet) 274, for example,” she noted.

“It is some guidance from the regulator to suggest that the minimum establishment can be reassessed or evaluated by advisers themselves, so it gives a bit more leeway to advisers in terms of that evaluation.

“So [we wanted to see if] in the long run the average balance at which SMSFs are set up [is being impacted by INFO 274], but there is still a question mark around that hypothesis.

“So far we don’t see any evidence [reduced establishment balances due to INFO 274] has been the case.”

Overall the study found fund establishments to December 2022 totalled 25,020, representing 4.2 per cent of all SMSFs. These numbers were slightly lower than those recorded for 2021 where a total of 29,708 funds were set up, representing 5.1 per cent of all SMSFs.

The 18th edition of the “Vanguard/Investment Trends 2023 Self Managed Super Fund Report” was compiled based on the responses of 2290 SMSF members to an online survey conducted across February and March.

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