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Making smart investment choices in your SMSF

One of the most exciting things about self-managing your superannuation is the ability to make your own investment choices. In SMSFs, there are also a lot more investment options available, and it can be tempting to get a little creative with your portfolio.

However, unless you are extremely confident and familiar with the investment, or have received trusted professional advice, it is advisable to be wary of unorthodox investment options. Especially if someone is making a hard sales pitch, because good investments sell themselves!

This week the ATO released a warning about telemarketers trying to convince SMSF trustees to invest in high-risk collectables, such as art. If you are considering investing in collectables, which can be a great addition to your portfolio, you should always have them independently valued.

If you are considering investing in unusual areas, you should also make sure that the investment meets the sole purpose test.

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Protect yourself from early super release scams

August 7, 2018

When it comes to protecting your nest egg, avoid getting caught out by a promoter of an illegal early release super scheme.

Early release super scheme scams will involve a promoter contacting you and offering to help you access your super early. They usually target individuals under significant financial pressure or those who are not knowledgeable about super laws and the repercussions and penalties involved in illegally accessing your super.

You can only access your super when you meet a condition of release.

Generally, when you:
– Are 65 years old (even if you have not yet retired).
– Reach your preservation age and retire.
– Reach your preservation age and begin a transition to retirement income stream while still working.

There are special circumstances where you may be able to access your super early.

These special circumstances include:
– Severe financial hardship
– Temporary or permanent incapacity
– Compassionate grounds
– Temporary residents leaving Australia
– Super death benefits (inheriting super)
– Super less than $200
– Terminal medical condition

To avoid falling for an illegal early super release scam, be wary if the promoter:
– charges high fees and commissions;
– requests identity documents;
– claims you can access your super and put the funds towards whatever you wish;
– and tries to persuade you to transfer or rollover your super from your existing fund to a self-managed super fund (SMSF) in order to access your super before you are legally entitled.