Industry Superannuation Fund Versus A Self-Managed Superannuation Funds

Industry Superannuation Fund Versus A

Self-Managed Superannuation Funds

When deciding whether to choose between an industry

superannuation fund versus a self-managed super fund

it is important to consider the pros and cons of each.

As the slick advertising campaign rightfully suggests,

industry funds are run solely to benefit their members

but what are the advantages of operating a self-

managed super fund?

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Advantages of industry super funds:

Less Research: The ability to

select investment strategies

without undertaking exhaustive

research

Risk: Match your investment

type against your risk profile

and let your fund manager do

the hard work for you

Less admin: The manager will

take care of all administrative

requirementsMore info on:



Set and forget: the day to day

operation of your superannuation

investment is overseen by a fund

manager, meaning investment

decisions are not required

Anti-detriment: Payments can be

made from a deceased person’s

benefit

Capital Gains Tax: CGT is only

taxed at a concessionary rate of

15%. Should assets be held for a

period greater than one year, CGT

is discounted by 30%.More info on:



Advantages of self-managed superannuation

funds:

Asset distribution: As a member

of a self-managed super fund you

are granted significant control

over the distribution of asset

classes that you will invest in

Combining family super: The

ability to combine

superannuation entitlements from

up to 4 family members and

thereby boost your investment

powerMore info on:



Investment options: The ability to lend

money in order to purchase asset

classes such as property, equities or

other investments.

Tax: Like an industry fund, a SMSF

provides extensive taxation benefits.

CGT is only taxed at a concessionary

rate of 15%.

Real Value: Unlike an industry fund,

SMSF provide an accurate

representation for the exact value of all

of your investments at any given point

in time. More info on:



Disadvantages of industry superannuation

funds:

Flexibility: Leaving investment

decisions to a fund manager

provides very little flexibility

with respect to how your money

is allocated

Estate Planning: The payment of

death benefits may not be binding

for some industry superannuation

funds, but rather this can be at the

discretion of the fund managerMore info on:



Anti-detriment: Funds are generally

not required to make anti-detriment

payments

Reversionary options: not available

with many funds, meaning that

death payments take the form of a

lump sum with the potential to

affect Centrelink or other benefits.

Performance: In spite of regular

communication it remains very

difficult to gain a handle on the true

investment performance of an

industry super fund.More info on:



Disadvantages of SMSF

Costs: Higher compliance costs means that a

minimum investment via a SMSF should generally

exceed $200,000.

Flexibility and Control: Requires a strong working

relationship with your financial advisor and

accountant given that members bear the compliance

risk.

Investment: Requires greater research and financial

literacy than industry funds. Financial planning

advice is also necessary.

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Industry Superannuation Fund Versus A Self-Managed Superannuation Funds