Q. I read an article which indicated more young people are turning to SMSFs, but I’ve always thought they’re more suited to baby boomers (largely because of the sheer amount of existing super you need to make the fund worthwhile). Notwithstanding my personal circumstances are there any extra factors I need to consider if setting up an SMSF in my 30s? Are there any extra roadblocks for younger people managing their super this way?
A. I don't think your age is a major consideration when determining if an SMSF is appropriate for your circumstances – it’s your desires on how and where to invest your super that is the most important factor.
For example, if you want to invest your super in direct residential or commercial property then an SMSF is your only option to achieve this. However, if you just want to have more control over your investments (eg. investing in direct shares), then establishing an SMSF to do this is likely to be an over-engineered and higher-cost solution in my opinion.
There are retail investment platforms that allow you to invest your super wherever you like and have full control without the compliance costs and obligations that come with an SMSF.
If you would like to invest in direct property but don’t have enough super at this stage, then it’s a case of either waiting until your balance is higher or combining your money with someone else’s (eg. establishing an SMSF with a sibling or family member).
Stuart Wemyss, founder, Property Tycoon Finance