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'FAMILY' to drive baby boomers move to Self Managed Super Funds

The desire to look after family will be one of the key reasons why Australia¿s baby boomers are set to embrace Self Managed Superannuation Funds (SMSFs) over the next 20 years, according to leading SMSF specialist Grant Abbott, CEO of The Strategist Group.

Abbott, who in conjunction with leading publishing group, CCH, has launched a new book, ¿Guide to Self Managed Super Funds¿, said a key factor for this trend was ¿choice and control.¿

¿The main driver in the spectacular growth of SMSFs, also known as Family Superannuation Funds or DIY funds, over the past few years has been the desire for many Australian couples to be in a superannuation vehicle which allows them to control and choose their investments,¿ Abbott explained. ¿And one of the greatest drawcards today is having the ability to look after your immediate family and possibly generations to come.

¿Quite apart from the current poor returns, the lack of family access is why so many people are dissatisfied with retail and employer super funds. Today, the two most popular structures for high net worth people are the family trust and the SMSF. Statistics show there is currently more than $105 billion invested in 250,000 SMSFs, and the ATO states there are 500,000 family trusts. It is staggering to think of the size of Australia¿s wealth concentrated in these two vehicles. And the reason for it is the family.

¿As the baby boomer generation matures, it is predicted that around $600 billion in assets will be inherited over the next 10 to 15 years, making the need for succession planning more important than ever in order to make sure objectives are met and loved ones are well provided for.

¿SMSFs are the ideal vehicle for doing this. Indeed, they are multi-generational, and the passing of retirement wealth and estate assets from generation to generation is as strong as ever.¿

Pip Hughes, CCH¿s Managing Director of Publishing, called the book ¿a real eye opener.¿

¿It will really help trustees identify any problems they may be experiencing in running SMSFs. And it offers practical experience and real life scenarios, which will help educate investors and ensure they get the most out of running their SMSF.¿

In Guide to Self Managed Super Funds, Abbott outlines eight key benefits of a SMSF:

  1. It allows you to look after your family

  2. You and your family are provided with a secure income in retirement

  3. It can offer a financial helping hand if your health deteriorates

  4. It provides virtually unlimited investment choice

  5. The low taxation in the fund is fully sanctioned by the government

  6. Your family is provided for when you die

  7. It may still permit access to the Age Pension

  8. It provides protection from creditors

The book is written in an easy to understand style, and outlines different case study scenarios. ¿Although the book is primarily focused on the professional adviser, it is also pitched at a level that is comfortable for members and trustees of SMSFs,¿ Abbott explained.

¿It is designed to provide advisers, members of SMSFs and all those people with an interest in this rapidly growing area with sound knowledge, strategy and commonsense ideas. It will also show the trustee how to create, run and manage a fund and, more importantly, how to ensure that all of their legal obligations in the fund are met, enabling it to access low taxation rates.¿

The book is also designed to be a wake up call to advisers, he added. ¿Until recently, SMSFs have really been a cottage-based industry, but people are now beginning to understand their responsibilities,¿ he said.

¿Since their inception in 1994, SMSFs have shown compound growth of 20% per annum. Currently they are increasing at around $500 million a week and, three years, ago overtook company managed funds in terms of funds invested.¿

The launch of the book comes in the lead up to the March 11, 2004 deadline of the Financial Services Reform Act, requiring any person advising clients in relation to a SMSF to become licensed.

Guide to Self Managed Super Funds retails for $79 and can be ordered from CCH¿s website , from the Strategist Group, or from Dymocks book stores.

About CCH

CCH is the leading publisher of tax, law, accounting, human resources & industrial relations, Occupational Health & Safety, financial planning, business management and superannuation publications. It is a member of Wolters Kluwer nv, a leading multi-domestic publishing group active in 25 countries in Europe, North America and Asia Pacific.

CCH Australia has spent over 30 years assisting professionals to establish and maintain their practices and businesses. It is renowned for the reliability of its content, the breadth and depth of information provided, and customer service. Not only is the company intent on maintaining that reputation, but it is determined to become the premium knowledge partner for Australian professionals.

About Grant Abbott

Since 1994 Grant Abbott has led the charge on self managed super funds (SMSFs) - sometimes known as DIY funds. Having personally trained thousands of accountants and financial planners, Grant has a simple philosophy when it comes to these funds. In short SMSFs are: for the family; there to provide the family with a secure retirement income as well as resources to look after the family in the event of the death of disability of a member; to provide family members with control and choice over their superannuation; an extremely tax effective from a savings and an income point of view.

With 20 years legal experience and ten years presenting and writing on SMSFs, Grant and his team at The Strategist Group are dedicated to making superannuation understandable, in addition to creating passion for SMSFs among accountants, financial planners and, more importantly, their clients.

For further information:
Lisa Llewellyn
Grant Abbott
Llewellyn Communications
The Strategist Group
02 9460 9925 / 0419 401 362
02 8913 5555 / 0404 842236
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