Superannuation is one of our largest assets with about 10 per cent of weekly income going into it.
So are you taking it seriously? And if not – why not?
Something I’ve learned in life is that it’s a lot easier to focus on something when you find a way to love it, rather than hate or resent it.
That said, here’s ten reasons why I love my self managed super fund
1. I’ve moved both my wife and my balance into our very own self-managed superannuation fund (SMSF), so we’re in complete control of it, and of the investments we choose to make.
Knowing we can purchase a property or take advantage of attractive start-up investments is especially appealing to us.
2. Every time money goes into our super from any salary our companies pay us, we know we’re keeping money from the taxman because super contributions are taxed at a flat rate of 15 per cent.
This is effectively giving us an instant 15 – 33.5 per cent return, depending on our taxable income that year, in the form of tax that we’ve managed to retain and that we would have otherwise had to pay.
3. Our money is building in what is essentially a tax haven, the maximum tax we pay on the income that any of our investments earn is 15 per cent.
4. Our fees are fixed, this means that as our total SMSF balance grows, the fees we’re paying don’t also increase.
5. We have access to funds that we know we can’t touch for a long time, so we can afford to take some big long term bets in relation to the investments we make.
6. We get to invest in start-up companies that we’re interested in and believe in.
7. We get to invest in property without tying up a lot of our own personal funds.
8. Our investment knowledge and experience increases with our involvement in our own SMSF, and this helps us become better investors overall.
9. Our SMSF is the only asset we have that is really protected should we be sued, and although it’s unlikely, it’s an important consideration as we start to build wealth.
10. Our balance is already quite large, because we have maximised our concessional contributions for several years now, and it will continue to grow each year, so no matter what happens we’ll be fine in the second half of our lives.