Why big super's pseudo-SMSF won't deliverBY KRIS KITTO | FRIDAY, 7 MAY 2021 11:55AM As the success of SMSFs boomed in the last decade, some industry funds rolled out self-directed or member direct investment options that allowed their members to invest (with ... Upgrade your subscription to access this article
Join the growing community of superannuation
professionals with unlimited access to our latest news, research and analysis of the industry.
Become a premium subscriber today. |
Latest News
Super turns a safety-net retirement into a comfortable one: ASFA
A comfortable retirement for a couple who own their own home now costs $1513 a week, according to the latest Association of Superannuation Funds of Australia (ASFA) Retirement Standard, which found that super remains key to comfortable retirement.
Trust emerges as key drivers of super fund loyalty
Superannuation fund members are becoming more purposeful in their interactions with funds, while trust has emerged as the clearest driver of loyalty and advocacy, according to new CoreData research.
Three super funds fined for misleading investment options
Three industry superannuation funds - Australian Retirement Trust (ART), TelstraSuper and Australian Food Super - have been pinged by ASIC for misleading members about their investment options' asset allocation and performance objectives.
Retiree super spending injects $121bn into Aussie economy
New research has found retirees will spend close to $121 billion from their superannuation in 2026, bolstering the Australian economy and supporting jobs.
Further Reading
Cover Story
Leading the way
SHARON DAVIS
NON-EXECUTIVE DIRECTOR
FUTURE GROUP AUSTRALIA HOLDINGS PTY LTD
NON-EXECUTIVE DIRECTOR
FUTURE GROUP AUSTRALIA HOLDINGS PTY LTD
Sharon Davis has always been fascinated by the human condition; it has driven her passion for people, her career, and building a better future for the next generation and beyond. Eliza Bavin writes.
Expert Feed
Warsh delivers clarity, not guidance, in Jackson Hole
In his Jackson Hole keynote speech, Fed chair Kevin Warsh delivered on what was needed to provide markets with greater clarity on his policy principles.
Retirement is changing. Our system, and our funds, need to catch up.
As compulsory super matures, success can no longer only be measured by the balances members build.
What if your super fund's biggest cost isn't on any report you've seen?
The cost of poor-quality onboarding and incomplete member data is not something most super funds can easily put a number on, but that needs to change.
Not all income is created equal
Why Australian public credit may be the most compelling source of income in today's market.
Thankyou Kris for your insights. To address your suggestion that big super funds pull money out of investment portfolios to cover future tax liabilities: in fact, they don't - they create an accounting provision for deferred taxes in valuing member accounts but this accounting liability is not backed by cash. It is essentially a gearing effect as the money remains invested to earn compounded returns until the tax is actually payable. This is really the same as SMSFs; it's just that the deferred tax liabilities are made explicit in the member account valuation. The point is that both types of funds can earn compounded investment returns until the tax actually has to be paid.
Just wanted to point out this article is inaccurate and probably misleading. Pseudo-SMSFs let each member who chooses to use them to accumulate unrealised gains just like an SMSF. Additionally some of them also allow members to transfer their investments in specie to the retirement phase and to directly benefit through the unrealised gain provision being removed boosting the balance available for retirement income.