SMSF growth to taper off: Dexx&r
The proportion of total retirement incomes funds under management (FUM) held in Self-Managed Superannuation Funds (SMSFs) is set to taper off, as benefit payments exceed contributions, a Dexx&r report indicates.
SMSFs accounted for 62 per cent of total retirement incomes FUM at June 2014, but Dexx&r's forecast predicted a slowdown in the growth of SMSFs, which will see it account for approximately 50 per cent by June 2024.
Data from the Australian Taxation Office revealed that SMSF benefit payment outflows exceeded contribution inflows for the first time in the 12 months to 2013, a trend the report expected to continue. "Contribution flows into SMSFs increased by an annualised average of eight per cent per annum from June 2004 to June 2013," the report said.
"Over the same time benefit payments paid from SMSFs have increased by 24 per cent per annum.
"This differential between inflows and outflows is expected to continue at current levels with the growth of total FUM held in both the accumulation phase and pension phase projected to increase from $557 billion at June 2014 to $865 billon by June 2024."
Recommended for you
ASIC has called on superannuation funds to improve their oversight of advice fee deductions following an investigation of 10 trustees that found $990 million was charged in one year.
With just 30 per cent of Australians knowing their superannuation balance to the nearest $1,000, Findex has emphasised the role of financial advice in addressing the critical super knowledge gap.
Underestimating the cost of insurance by almost $75,000 in a Statement of Advice is among multiple reasons that a relevant provider has faced action from the FSCP.
Financial Services Council chief executive, Blake Briggs, is urging Minister for Financial Services, Stephen Jones, to take advantage of the QAR opportunity to reduce regulatory duplication and ensure advice is affordable.
