Why You Should Have A Family Superannuation Fund
There are more than 420,000 self-managed superannuation funds (SMSF) or “DIY” super funds operating in Australia controlling over $375 billion in assets and this number is continually growing each year. The majority of these funds have been established for one reason only and that is to enable members of the fund to control the investment of their superannuation monies and prepare for retirement. We believe this to be a short term concept for what could be a long term investment vehicle designed to look after the needs of your family for generations. As The Self-Managed Super Specialists, we can assist with strategies to grow your fund and establish a “Family Superannuation Fund”.
What is a “Family Superannuation Fund”? A Family Superannuation Fund builds on the foundations of a SMSF. However, unlike a SMSF which would generally provide for your retirement savings, a Family Fund consolidates your family’s wealth into a single investment vehicle which can facilitate the intergenerational transfer of wealth. Think of it as a modern day family trust.
Self Insurance and Incapacity: What would you do if you or your child was in an accident and incapacitated? A Family Superannuation Fund can create a self-insurance policy to cover your family in the case of an accident or death. It can even provide cover for those who may not be able to obtain insurance. The Family Superannuation Fund can help to pay a benefit to the affected member to assist with their needs. All expenses can be paid out of the earnings from the fund and are tax deductible to the fund.
Continuous Documentation: All strategies for self-insurance and estate planning with a Family Fund need to be well documented and implemented. It is vital to ensure all strategies are constantly monitored by a specialist in Family Superannuation Funds.
Estate Planning: By establishing a Family Superannuation Fund, benefits can be passed down from generation to generation, within the same fund.
Once your children start their own families, new Family Superannuation Funds can be established from the existing Family Superannuation Fund and be tailored to the needs of the siblings. This can ensure all family benefits and assets are held for the benefit of future generations.
For blended and split families, multiple Family Superannuation Funds can assist with splitting benefits between children, while still controlling and continuing to assist in growing the fund for their current and future needs. Thus, family superannuation funds can provide protection from Divorce, Bankruptcy and claims against a deceased estate.
Borrowing: Sophisticated strategies such as borrowing within a Family Superannuation Fund can allow you to safely borrow to acquire any worthwhile asset with the protection of predictable cash flows from contributions, thereby reducing the risks normally associated with borrowing to invest.
DISCLAIMER: The information contained in this document is based on information believed to be accurate and reliable at the time of publication. Any illustrations of past performance do not imply similar performance in the future. To the extent permissible by law, neither we nor any of our related entities, employees, or directors gives any representation or warranty as to the reliability, accuracy or completeness of the information, or accepts any responsibility for any person acting, or refraining from acting, on the basis of information contained in this communication. This information is of a general nature only. It is not intended as personal advice or as investment recommendation, and does not take into account the particular investment objectives, financial situation and needs of a particular investor. Before making an investment decision you should read the product disclosure statement of any financial product referred to in this newsletter and speak with your financial planner to assess whether the advice is appropriate to your particular investment objectives. financial situation and needs.