The growth of the SMSF sector to more than $1 trillion in assets is a significant milestone highlighting the value of such funds to members and overcoming ongoing opposition as to their viability and cost, the SMSF Association has stated.
Association chief executive Peter Burgess said the most recent ATO SMSF statistics, which show total assets are now estimated at $1.024 trillion, demonstrate the sector has thrived over the past four decades.
Burgess said this growth has come despite regular criticism SMSFs were costly, complicated and delivered lower returns compared with their Australian Prudential Regulation Authority (APRA)-regulated counterparts.
“These were criticisms that the sector – and the association – took extremely seriously, so it was gratifying when research commissioned by the SMSF Association showed that an SMSF with net assets of $200,000 can be competitive in terms of costs and investment returns compared with APRA funds,” he said.
He said the industry body was proud of the sector’s remarkable evolution from the mid-1980s ‘excluded funds’ regime to the introduction of SMSFs in 1999 under a more comprehensive regulatory framework.
“Over nearly four decades we have seen the emergence of a dedicated cohort of advisers who have played a critical role in guiding SMSF members through their own unique superannuation journey,” he said.
“The fact every inquiry into superannuation has given our sector a clean bill of health is testimony to the professionalism they bring when advising their clients.
“It’s always been the association’s mantra that SMSFs are not for everyone. But for those individuals who want to take direct control of their retirement savings, whether in the accumulation or decumulation phase of superannuation, they have proved a very effective vehicle.
“This extra flexibility and control can manifest itself in many ways, including investment flexibility, estate planning flexibility and the ability to structure the fund in a way which best suits the needs of fund members.”