Gday guys, been thinking of this before i even knew it existed! After 08 my super took a hammering, i basically have written it off as a government asset, something i will never see, not worth p@#@ing on. Whats the minimum you need to start off? Can i just convert the whole lot to bullion and park it? Should i just write off my pittance amount of super if not worth smsf,and just keep stacking? Seems to be varying opinions on start up minimums,any thoughts?
I know people who started a SMSF with $12,000 and are sooooo happy and, according to them, financially better off.
I think the return is what it is all about not the amount. If you can return a profit after all fees have been paid, that would be the only criteria I would work on.
I intend to setup my SMSF when I have a balance of $10,000. My rationale is that even if I park it in UBank for an odd 6% I will basically cover the annual fees and it'll be 'my money' to do whatever with (risk free). After that all my super payments will go towards buying bullion in the SMSF and the original $10,000 can exist to purely cover my annual costs of running a SMSF.
OK sounds like you guys have it sorted. So in essence i can take my pittance and control it myself, i want to take the control away from them and do it myself. Thanks guys. In 08 my super went from about $22k down to about $17k, i dont want it to keep falling, i have some thinking to do!
This! ^^^^^^ I am in the process of doing mine atm even though it will mean effectively having 2 accounts - one for the money from work which cannot be paid to my choice of fund due to the EBA we have, and my own SMSF with all the rest.
Hello Iceblue; There is a group of individuals who all have their own SMSF's and they have been operating an SMSF interest group in Glen Waverley the first tuesday of the month. The cost is $3 a meeting which covers the hire of the hall and instant coffee and a bicky if your quick. Don't know how often you come up to Melbourne but the meetings are worth their weight in gold. They run from 6;30 pm sharp and is usually done by 8:30. If you'd like more info drop me a message. Kind Regards non recourse
Fishy you won't need anything like $10,000 for your costs. If you learn to do your own SMSF tax returns and then just pay for the auditor you shouldn't need to spend more than $500-$800 including the ATO annual rip off fee. Kind Regards non recourse
Iceblue, the minimum amount is about what Fishy was alluding to. With a very small amount the cost of running the fund become not sustainable. Someone has to prepare the accounts (this could be you) and someone has to officially audit them. The minimum I have been able to achieve is an annual cost of $400.00 for these costs. SWMBO prepares the accounts and gets our accountant to verify they are OK, then another professional audits them. In fishball's example this would leave him with $200.00 in the account or a return of 2% for the year (on his original capital) less whatever tax you have to pay if any. Two percent ain't much, but it is better than the minus 22% you copped. .
Pretty sure the interest which is 6% of $10,000 = $600 and after tax that's around what, $500? That's still below the 500-800 you quoted. Assuming the bare minimum in costs and everything done by myself I would only be even with a 10k cash base. I'm not a PM permabull so I don't intend to spend every last cent buying bullion, if I can put 10k cash in my SMSF to offset any fees I can do whatever I want with my other money. It becomes self-sustaining, even assuming my other investments go bad. I have seen some people who run SMSFs poorly (illiquid) and be forced to sell their assets just to pay the audit fees. ^ This. In the end it's all about the eventual benefits, if your super fund charges you more than $700 a year probably get out and start SMSF right away. Mines doesn't though, so I'm pretty happy sitting there until I get a balance of $10,000 for my SMSF to be self-sustainable. Anyway I am just thinking out loud, my situations/plan might not be applicable for other people .
Hopefully, our illustrious cash starved government doesn't change the SMSF rules, prior to you getting your $10,000 balance. Otherwise you just may miss the boat.
OK you guys are Great, thank you all. @Nonrecourse thanks heaps. While i hate the city with a passion i would not proceed without coming to one of those meetings. Iam going thru all the tax info now (omg) but yes will get in touch soon.
Sorry to hijack, But does anyone know if there is a similar community group as non recourse mentions in Brisbane/SEQ. Cheers
