“New year, new me!” We’ve all heard it plenty of times – may have even said it once or twice, but how many times has it actually resulted in tangible results?
This year why not start with a few simple things that can have a big impact on your future! Here are a few idea’s to get the most out of your SMSF.
Do you have any other superannuation accounts out there? Many of us who have held casual or other short term jobs in our lives may have small superannuation accounts that are otherwise forgotten about. The ATO has made this much easier to check how many superannuation accounts you have by logging in to your MyGov account. If you do have extra accounts, it may be worth consolidating them all into your SMSF no matter how small the balance. Not only will you potentially save on fees, you will have more money to use for your SMSF investments and income.
It seems obvious but depositing extra money into your SMSF each year can lead to massive returns in the future due to compounding returns – there is a reason the government limits how much you can contribute after all!
Not only are the long term advantages considerable, you may also reap some short term benefits. The government’s Co-Contribution Scheme is still in effect granting a maximum of $500 to eligible members with non-concessional/after tax contributions, however the biggest reward is for those who contribute concessionally. Although your concessional contributions are capped to $25,000 per year and includes your employer superannuation guarantee amounts, any contributions made under this method may then be claimed as a tax deduction in your personal tax return. It’s a great strategy that can save you now and in the future! As always check with your accountant first before proceeding.
With Australian financial markets stabilising to “COVID-normal” it is a good time to look over your SMSF investment strategy. Do you need to adjust where your investments are? Are there opportunities available now that perhaps were unobtainable previously? Do you still need to mitigate future risks? Perhaps it may even be time to engage a financial planner to assist with any uncertainties you may have with your investments?
Having a suitable investment strategy and reviewing it on a regular basis ensures you are maximising your returns while keeping your risk of losses at a comfortable level.
If you don’t have a long of a time frame there are other options you should be considering – in particular what your taxable member components are. If you were to start a Transition to Retirement Income Stream (TRIS) or retire completely before 60, any taxable component withdrawn from the SMSF will need to be included in your personal tax return. The taxable component has an even bigger affect on your estate and beneficiaries when you pass away. Review your circumstances and engage your accountant or financial planner to see if a pension drawdown/recontribution strategy will assist you in reducing your taxable components while increasing your tax free balance.
How your SMSF Accoutant can help your SMSF planing
If you want to give your SMSF a refresh and restart for new year, please feel free to give us a call on 1300 392 544 or get in touch online to arrange a time to meet so that we can discuss your SMSF in more detail.