Self Managed Super Funds

Self managed super funds (also sometimes referred to as DIY super
funds, or self managed superannuation funds), is a fund that you
manage yourself granting the user more control and flexibility than
the alternatives such as using an independently managed superannuation
fund. There are several points that must be met for these funds. First
of all the trust deed must meet the requirements of one
'Superannuation Industry Supervision Act' which was set up in 1993
(sometimes referred to as a SIS act). It must have four or less
members, and each member of the fund must be a trustee. Another rule
here is that no members of the fund must be employed by other members
of the fund (with an exception for those members who are also
related), and none of those trustees must receive any financial reward
for their services towards the fund.These self managed funds will
otherwise perform the same role as the independently managed funds.
Here by investing contributions the members make them available to the
fund - of course as there are multiple investors this creates more
capital for the group than one individual could obtain on their own
meaning greater returns. The money donated into the group is then
returned to the members upon their retirement along with the interest
made on their investments. What is different however is that the
members here are also the trustees and can then control where the
money is invested and how it is increased. This has many benefits for
those who are happy to put in the extra time and effort. For example
it means that the trustees can feel safe in the knowledge that they
are investing the cash themselves - that way they have full control
and they can feel as though their profits are in their hands. This way
they don't have to worry that their money will be invested poorly
without their consultation and end up lost as a result. This also
gives the trustees more flexibility - as they are running the fund
they can decide on how much and when they contribute etc, as well as
the nature of the industries they invest in. Finally some people will
also actually enjoy having this kind of involvement in their finances,
and can also feel a sense of satisfaction from it.However there are is
also a lot more responsibility on the part of the trustees. For
example they must ensure to invest the money wisely, and each of them
will be responsible for the success of everyone's investments. At the
same time they will have to ensure the fund complies with the law,
keep their records at all times in case these need to be checked over,
ensuring the funds are in the correct names and informing the
authorities of any changes, working together as a group.This all makes
these funds particularly suited to particular groups. For example
younger individuals whose balance will likely be slightly lower, those
who are over seven years away from retiring and those who are a little
closer to retirement (but no less than three years). This opens the
super funds up to a large number of people who can benefit from all of
the flexibility and security, but also the education gained from self
managed funds.