The returns from the self-managed super fund (SMSF) sector that were on a par with the Australian Prudential Regulation Authority (APRA) regulated superannuation sector have proved that SMSF members can manage their investment portfolios effectively, according to the SMSF Association.
The Australian Tax Office (ATO)’s figures showed that an SMSF sector was growing in a sustainable manner with a 26 per cent increase in the number of SMSFs over the past five years.
At the same time, the median SMSF balance increased to $642,000 which represented a healthy 30 per cent growth over the past five years.
SMSF Association’s chief executive, John Maroney said: “This strong performance, the fifth consecutive year of positive returns, is also an endorsement of the SMSF specialists who advise many members about their investment portfolios.
According to him, the sector delivered on the Government’s objective for superannuation to provide income in retirement, with 94 per cent of all SMSF benefit payments being in the form of a pension with the median pension payment being $63,000a year.
“The high percentage of pension use by SMSFs has been a consistent positive aspect of the sector as highlighted in the ATO’s annual statistical publication over a long period,” Maroney said.
The data from the ATO also revealed that 57 per cent of SMSFs were managed through a corporate trust structure and 81 per cent of newly registered SMSFs in 2017 had a corporate trustee.
“this is a positive for the sector as the SMSFA has always advocated that corporate trust structures are best practices due to their advantages for SMSF administration, succession planning and aging trustees.”