The desire for setting up a self managed super fund can arrive late in life for Australian citizens, but this package is considered one of the best methods of optimising superannuation retirement savings.
Given the tax concessions that are passed down to the range of investment choices that are on show, the flexibility for participants to the consolidation of assets, it makes sense to break away from those stock standard accounts that offer little in the way of returns.
Being aware of the financial advantages is one component for men and women, but it is establishing the fund where the real precision is required.
We will outline 6 key tips for individuals and groups to follow, giving them a viable program where serious money can be made.
1) Determining Who is Involved
Phase one for setting up a self managed super fund has to cover the participants who are putting their hand up for the program. The legislative requirement will see a minimum of two individual trustees with the fund and a maximum of four. Citizens over the age of 18 years of age can be involved and include any close family members, partners or friends. The trust must be very clear with its trustees, its assets, the intention to make a trust and any beneficiaries that can be identified.
2) Hiring Specialist Assistance
Before moving onto the next phase with setting up a self managed super fund, it is vital that citizens have expertise and experience to negotiate through the rest of the process. All parties should be made aware of who is consulting the clients, what advice they are passing on and when and where decisions about the fund are made. It is easy to be lost in the minutia of the project, so having that professional guidance will be advantageous.
3) Sourcing The Trust Deed
It is important to think of the trust deed of the self managed super fund as the official terms of service and the strict rules that are stipulated as part of the program. None of the clauses can violate the Superannuation Industry (Supervision) Act of 1993, it must specify if the fund can pay pensions, it must stipulate its objectives and more. Amendments can be afforded under certain conditions.
4) Placing Signature on The Declaration
In order to be cleared by the Australian Tax Office (ATO) with setting up a self managed super fund, the trustees have to put pen to paper and list their signature on the official document. It demonstrates transparency, awareness and ensures that the lodgment is legally binding.
5) Lodging The Official Election
For people who are setting up a self managed super fund, they will be afforded a 2-month window to lodge the official election with the ATO. As the regulator, they will give this 60-day period to trustees, ensuring that the document is adhering to the concessional 15% tax rate and complies with the current superannuation legislation that has been stipulated.
6) Creating The Account Through The Bank
The final phase that is necessary with setting up a self-managed super fund is to craft a cash account through a financial institution. That will allow the fund to actually achieve earnings and receive contributions from the range of investments that have been sourced. It also helps to provide tax payments and accountancy fees that are identified in the same package.
Although it can feel quite exhaustive with setting up a self managed super fund, this is just step one to take advantage of the system for retirement saving purposes. This is where the strategy comes into play and the major reason why professional assistance is so critical for participants. Follow these steps first to enjoy a superior superannuation saving approach.