Switching to an SMSF

I AM thinking of establishing a self-managed super fund with my husband. Will I be able to rollover my current salary sacrifice contributions from the First State Super Fund?

Answer this week provided by Dianne Charman, an AMP financial planner and director of Jade Financial Group.

First up, I recommend you do your homework and read about how an SMSF would work for you. However, there are a few pointers if you are considering this type of fund.

If you are looking for more control over your superannuation savings then an SMSF is a popular option. The ideal minimum funds to commence an SMSF are $200,000. The reason for this is that, in relation to the fees, this is usually the amount when the SMSF becomes competitive with retail-type funds.

Please also bear in mind that yourself and your husband would be the trustees, and as such responsible for ensuring the fund is always compliant with the governing legislation. The Australian Taxation Office administers SMSFs and their website (www.ato.gov.au) is very useful when it comes to rules and regulations.

In relation to your salary sacrifice contributions, the current balances can be easily rolled over. In order to do this you will need to provide the appropriate proof that your fund is registered so as your current superannuation provider can rollover the balance. You’ll also need to set up a working account for your fund so you can deposit your contributions.
It is possible that you may find your current super fund will not be able to directly credit your balance to your account and will send you a cheque.  Furthermore, if you’re an employee you’ll need to check with your employer if they are able to directly credit any future salary sacrifice contributions to your SMSF.

I hope this helps. Just remember that an SMSF is a major financial decision and one that comes with many legal and financial responsibilities.

Where to find out more:

For more information on Dianne Charman visit www.jadefg.amp.com.au or to find your nearest AMP financial planner visit www.amp.com.au/findaplanner.

Any advice given is general only and has not taken into account your objectives, financial situation or needs.  Because of this, before acting on any advice, you should consult a financial planner to consider how appropriate the advice is to your objectives, financial situation and needs.